Database Marketing |
Database marketing is now an essential part of marketing in many industries. The main principle of database marketing is that at least part of the communication organizations have with their consumers is direct. From this simple principle has grown a whole new discipline. However, it has not grown that quickly. The seeds of database marketing as we use it today were sown in the 19th century by the US mail order industry, which served so well the needs of remote farmers, ranchers, settlers and new townships. You can download powerpoint slide on customer management and marketing strategy here. Database marketing has three further important characteristics: • It is based on direct responses. Database marketing communications invite consumers to respond - by mail, telephone, Internet, redeemable retail vouchers and so on. The response may range from enquiry and giving information to ordering. This opportunity for monitoring feedback is critical to database marketing. • Database marketing is measurable. In any database marketing campaign, responses are measured, evaluated and analyzed. Responses can be through any medium - telephone, mail, Internet hits or whatever. Measuring responses leads to accountability. All costs can be related to response. Return on investment can be calculated. Traditional advertising relies mainly on market research techniques based on samples to measure effectiveness, although for some campaigns sales results can be accurately measured (for example, if the campaign is run in test areas only). Database marketers use transaction data to measure. This is one reason database marketing has been called scientific advertising. Database marketers conduct their tests in controlled environments. While environments do change, database marketing is as near to a science as marketing achieves. • Database marketing usually requires the organization to build and maintain a database of consumers and prospects. This gives it better understanding of the market and can give it competitive advantage.
Technical Definition 1. Planning marketing activity. All database marketing should form part of a controlled marketing strategy, which has been produced as a result of market and competitor analysis and in relation to achievable objectives. 2. Targeting consumers. Consumer information should be stored and capable of manipulation and retrieval from the consumer database, to contact existing consumers. Analysis of this also helps the organization to identify characteristics of future consumers. 3. Measuring your marketing activity. The results of database marketing should be measured, to tell you what works and what does not. 4. Tracking. This involves monitoring consumers' responses over time, for as long as the relationship with them lasts. This allows the organization to measure their value, and understand how much of it results from how it marketed to them. 5. Consumer behavior. Tracking the spending patterns and general behavior of consumers can help the organization establish which products are popular and which are not. This can help it determine future products and strategy. 6. Future strategies. One aim of marketing is to maximize the value of the organization's consumers to it. The previous steps will ensure it has the information to plan effective and efficient marketing to achieve this aim. 7. Developing long-term loyalty. By targeting the right consumers, offering them what they want, and encouraging them to take more of your products, an organization can protect its consumer base. Its consumers will be more likely to stay with it for longer. 8. Encouraging profitable growth. This is achieved by increasing the number of loyal and valuable consumers the organization has, and limiting the number of consumers with low value and/or high risk. This increases turnover and profit, which can be re-invested to ensure service and product standards are maintained and that consumers stay happy. You can download powerpoint slide on customer management and marketing strategy here.
Planning Database Marketing Activity
• acquisition - recruiting new consumers;
Acquisition Marketing
Database management
Retention and Development
Source of Reference:
You can download powerpoint slide on marketing management and strategy here.
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