DM News Essential Guide to Lists and Databases: Customer Loyalty at the DM Superstore

In many small villages in France, you “go to market” almost every day. Your senses are overwhelmed with open-air displays of local farmers’ freshly cut flowers and produce. On the way home, you stop at the boulangerie for a fresh loaf of bread, the fromagerie to get some Camembert and the confiserie to buy chocolate truffles.

This way of living engenders relationships with each of these vendors. Sadly, with the ramp-up of supermarkets and changing lifestyles, only 20 percent of the French population shops outdoors while the rest takes advantage of the efficiency, variety and convenience of superstores that integrate many food services under one roof.

Direct marketing may not be so sensual an experience, but there are comparisons between open-air markets and DM vendor selection. A retailer may use a list manager to promote its customer file, a full-service e-mail shop for customer retention campaigns, an e-mail lead generation business, an e-mail append provider, a teleservices center to receive inbound orders, a list broker to test new list sources for customer acquisition and a computer processing company for file hygiene, merge/purge and list order fulfillment.

The retailer also may use a business and consumer file compiler (two different companies in all cases but one) for data enhancement and list selection, and a database marketing company to design and maintain its marketing database for customer file segmentation, model development, aggregate purchase history, etc.

As with the open-air markets, this business model requires time to maintain multiple relationships. And, like the open-air venue, one vendor probably does not know too much about what the other vendors are doing. In today’s digital world of “I want it yesterday” and real-time transacting, this one-vendor-per-service model has become less efficient. It hampers a direct marketer’s need to streamline and accelerate processes, relationships and revenue growth.

Lifestyles change and so do business requirements. DMers need one resource offering a host of services. They look at their customer relationships in a holistic manner. For example, does their retail advertising affect Web activity or vice versa? Do file hygiene updates affect every repository where a customer’s name/address information is maintained, including the list management file? Just how much is each customer spending online, in the store, through the catalog?

How can a direct marketer leverage the linkages among different business functions? The answer lies in the integration of multiple DM services within one vendor. This single resource offers advantages not found in the open-air market approach.

Efficiency: Maintaining fewer relationships lets direct marketers focus on other business requirements.

Strategic thinking: Combining several processes under one roof forces the DMer to look at its business in new ways. Instead of silos, integrated processes are designed specifically to facilitate business growth. And it forces the multi-services provider to be flexible and to forgo the “silo” approach as well.

Favored terms: A one-stop vendor typically has more price flexibility and can pass the savings to the direct marketer. Longer terms of service also can affect price considerations.

Proactive approach: Now both client and vendor can solve business problems from a common point of view. The outcome of this problem solving is where the vendor is transformed, in the eyes of its client, into a business partner. The exchange of ideas, insights and intellectual capital grows as the partner serves and client business requirements become better aligned. The business partner takes the lead in understanding all the requirements of multichannel marketing and manages all the components that make up the total solution.

As direct marketing grows more customer-centric, leveraging multiple services under one roof becomes essential. There is no better way to anticipate, capture and link customers’ preferred transaction channel, payment method, privacy requests, product purchase history and lifestyle changes to earn customer trust and loyalty.

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