Decrease spending, increase efficiency

Happy New Year!  Marketing Week, (4 Jan 2010) has again given me a juicy topic for Momentum Analytics’ first blog post of 2010.  It argues that campaign targeting will take centre stage in 2010.  Throughout the majority of these posts, I’ve discussed approaching data as a ”business critical resource” in a relatively abstract manner.   A colleague of mine consistently hammered home the point that when it comes to data, analysis and genuine, revenue-driven insight; “Garbage in, Garbage out”. 

So.  How do you justify outlay on something relatively intangible?  Marketing Directors, media planners, Direct Mail marketeers can all justify thousands of pounds (even hundreds of thousands of pounds) on creative and copy, because it is possible to interact with it, to visualise it.  Investment in data and analysis is much more difficult to come by.  This can have knock on effects on campaign monitoring - how often is campaign activity

• quantified (either as stand alone performance, versus previous performance or versus a prediction)?
• tracked back to customer data?
• fed into the next piece of activity?

All this campaign activity is designed to increase revenue – often seen (correctly) as a measure of success.  Yet it should not be the only measure of success.  Indeed, if a campaign budget can be reduced by 20%, with a loss of 2% to the standard response rate (i.e. 2% response drops to a 1.96% response rate) then this should be deemed a success also.  And the most effective way to achieve wins at the beginning and end of a campaign?  Analysis.

Efficiencies of campaigns has always been a constant metric on which performance has been measured.  With a difficult, pressured and stressful 2009 still fresh in the memory, we should press for an increase in campaign efficiency by smashing down knowledge silos that build up in businesses of all sizes.  The emphasis should now be on joining up internal resources to best benefit the business.  You quite probably already hold information in your business that can save you thousands of pounds and make cost-per-response work in your favour.  Use what you already own to make make sure that your business only receives one form of successful CPR this year.

Relevancy in contact strategies - from registration to loss

A recent article in Marketing Week touches on an important aspect of effective customer management; relevancy. The initial excitement with which marketers and businesses embraced email as a new channel for contact, gave way to disillusionment from both the consumer and the service provider. On the one hand, the customer faced an onslaught of unsolicited marketing materials. On the other hand, despite the volume of broadcasts, businesses were struggling to see any trickle-through to their business.

Over the past few years, as opt-ins and tailored mailing lists became the norm, the volume of “solicited spam” (unwanted emails, but from businesses where a customer currently has or has historically had a relationship, rather than boundless offers for Viagra) the industry has come to the realisation that the opportunity for direct contact needs to be tailored. The initial approach was to be frugal with broadcasts, but general with content. And there is some success with this approach.

However, true email-based customer service comes from timely, relevant and pre-emptive contact. By examining customer data, a consultant can help your business translate patterns that exist in your data, and ensure that email broadcasts are:

• targeted to portions of your base (rather than the whole base)

• contain relevant offers and information (know what your customer wants before they do)

• due to their specificity, can be fully quantifiable – true end-to-end ROI

• If used correctly, can assist in arresting churn

By knowing that that less really can be more, a move towards a data-driven customer service approach can help a business generate revenue for a relatively small level of investment.