Use Data to Get Personal With Your Customers

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One of the strengths of the Internet has been the capability to interact with customers in a highly personalized way. However, businesses that were anxious to get launched and/or had a limited budget often have taken a practical approach to designing their Internet presence and have avoided the cost and time associated with implementing personalization technology.


But the Internet has taught customers to expect the information, products and services that you put in front of them to be relevant. Personalizing a customer's experience does not have to be rocket science -- and software vendors have developed packages that streamline the task of developing personal conversations.


These changes in development time and costs as well as customer expectations mean that being personal is the only practical thing to do.


A practical customer experience.


On a recent Internet shopping trip, I stopped by a well-known PC vendor to buy a home-office computer. The vendor had a well-designed site -- similar to its catalog but with additional search features. After finding a PC, I proceeded to place it in my basket and check out. Unfortunately, it was not in stock. Since I'm a product of the Internet age, I am always hungry for instant gratification, so I closed my browser and drove to the local computer store to buy what I wanted.


Having ordered online from this vendor before, it has all of my contact information. It places my name on its home page when I visit its Web site. If this vendor watched how I behaved, it also would know that I got to the point of checking out and suddenly abandoned my shopping cart. The vendor also knows what I had in my cart and that the item was out of stock. Using this information, the vendor could have proactively recommended similar products to me. Instead, it lost a potential sale of more than $2,500.


This vendor has a very practical Web site, making it easy and convenient to find and order products from its site at competitive prices. Unfortunately, so do at least a half-dozen other vendors. The best way this vendor could keep my business is to proactively put relevant information in front of me at the right time. Instead, it relies on me returning to its site to find what I need -- not much different from a typical cataloger.


A personal customer experience.


I received an e-mail with a link to a press release. Normally, I delete press releases without reading them. However, this e-mail came from an individual I know who works for an organization with whom we partner. It also was personalized (with "Dear Geoff" as a salutation). Because I knew the person, and because he had taken the time to send it to me, I read it.


As I was sitting in a co-worker's office later that day, I noticed that he had an e-mail with the same subject, but from someone else in the same company. This company had used a simple personalization technique to ensure that the e-mail came from the appropriate person within the organization.


The above example is personalization in its simplest form, yet it plays a powerful role in building relationships with customers. The personalization cannot be easily imitated because it requires that the company have a relationship with me before the personalization becomes meaningful.


More sophisticated forms of personalization can be found at companies such as SmarterKids.com, Travelocity and Dell Computer. Explore their Web sites, customer profiles and e-mail campaigns to see personalization in action.


Getting personal.


So how does a business get personal with its customers? How do you begin to use all that information you have about your customers to dialogue with them in ways that are uniquely relevant to them? There are plenty of sophisticated technology solutions that address these questions, but a successful start usually begins with these four steps:


o Find your best customers -- Using your database of customer information, locate the 10 percent of your customers whom you think contribute the greatest amount to your bottom line. These are the customers who will be your competitors' top customers if you do not treat them right. Allocate a disproportionate amount of your marketing budget to keeping these customers.


o Profile your best customers -- Understand what makes your best customers different from your other customers. Then find customers who "look like" your top customers, but for some reason are not there yet. These may be your competitors' top customers. Allocate a disproportionate amount of your marketing budget to upselling these customers into broader and deeper relationships.


o Dialogue and personalize -- Remember that relationships are built on two-way conversations. Think about how you can do a better job of listening to your customers. Do you remember what they bought and returned? Do you capture their behavior on the Web site, their complaints in the call center and their response to e-mails? Do you ask them questions and remember the answers?


Personalization is using this information to position your next conversation with the customer. Plan how you will use this to make the experience more relevant to your customers.


o Think "process" not "project" -- Marketers are often guilty of thinking about marketing projects (e.g., a Christmas campaign) rather than about processes (e.g., survey customers the second time they abandon a shopping cart with a value of more than $2,500). This is an especially deadly sin when it comes to personalization. Part of the reason that marketers tend to focus on projects is because processes are neither sexy nor high-impact when taken alone. However, the total impact of many processes implemented over time can have an enormous and ongoing bottom-line impact.


Personalization does not have to be rocket science. In fact, many companies have overspent on personalization technology. The real key to personalization is understanding your customers (i.e., having a database) and thinking about the rules your Web site and e-mail process should use to put the right information in front of the customer at the right time.


• Geoffrey Ables is executive vice president at Quaero LLC, Charlotte, NC. Reach him at ables@quaero-corp.com.
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