A Small Business Guide: Using Database Marketing to Target Loyal Customers

TIPS FOR BETTER RETAILING: “Using Database Marketing to Target Loyal Customers”

by Joel R. Evans and Barry Berman

 
As we noted last month, too many firms concentrate on how to woo new customers and do not pay enough attention to what they can do to gain the loyalty and increased patronage of their current customers. One of the ways to improve this situation is to develop a customer database and use it to better communicate with these customers.
WHAT IS DATABASE MARKETING? It is a way of collecting, storing, and using pertinent information about customers. Although customer databases are often associated with computerized management information systems, they may also be used by small firms that are not computerized. 
Here is an illustration of how a small, non-computerized firm can rather easily set up and utilize a customer data base: 
  1. People could be asked for their names, addresses, telephone numbers, and product interests by having forms and pencils available at the checkout counter. They could be encouraged to provide the data by offering a monthly raffle and awarding a low-value prize to the winner.
  2. The customer information gathered in step 1 would be entered onto large index cards. The company would alphabetize the cards and keep them in a filing cabinet.
  3. Once customers have filled out forms, they would be asked for their names on each subsequent trip to the store. Thus, information in the database files would be updated from the sales receipts.
  4. Separate special mailings could be targeted at regular customers and at noncustomers in the database.
By adhering to the preceding procedures, a firm could learn more about its most important customers and treat them better. For example, in many situations, some version of the 80-20 principle probably applies, whereby 80 percent of sales are made to 20 per- cent of customers. With database marketing, a firm could identify those 20 percent and better satisfy them through superior product selection, announcements of special sales, personal attention, etc. In addition, the firm could identify and place heightened emphasis on the next 40 percent of its customers, a group that has often been ignored by companies.
Via database marketing, a retailer could also determine which customers are no longer shopping with that firm and which customers are shopping less often. In these instances, people may be called– in a cordial manner–to find out why they are no longer shopping with the company (or shopping less). Based on the explanations given, the firm could then offer special promotions geared directly to those people.
Research studies have repeatedly shown that people will patronize a firm with which they have been unhappy if they are given the opportunity to voice their opinions (which may be complaints), they are listened to in a courteous manner, and they feel that a firm has responded to their concerns. By no means are those customers “lost causes.” In fact, properly dealing with the customers who have had gripes might lead to even stronger loyalty by them to the firm.
What’s the key to successful database marketing? It must be viewed in a positive way as a beneficial tool, and not as an unwelcome and burdensome chore. KNOWLEDGE IS POWER; AND POWER LEADS TO PROFITS.

 

Posted in Part 1: Overview/Planning, Part 2: Ownership, Strategy Mix, Online, Nontraditional, Part 3: Targeting Customers and Gathering Information, Part 6: Merchandise Management and Pricing, Part 7: Communicating with the Customer, Strategy Mix | Tagged , , , , , , , , , | 1 Comment

Video and Social Media Are Big in the Mobile Era

According to JWT Intelligence’s Hallie Steiner:
“Video streaming and social networking are monopolizing mobile attention, according to research from Ericsson’s latest Mobility Report. Two-thirds of mobile traffic now comes from the top five apps in any given market — in the U.S. they’re Facebook, YouTube, Netflix, Instagram, and Snapchat, respectively. This year also marked the first time that more people watched streamed video content than broadcast TV over a weekly period. These are some of the top findings from the report, based on data from late 2014.”
“The implications for advertisers are, of course, huge. By 2018, $118 billion of the $150 billion global ad market will come from mobile, according to eMarketer projections.”
Click the image to read more.

 

 

Posted in Online Retailing, Part 1: Overview/Planning, Part 2: Ownership, Strategy Mix, Online, Nontraditional, Part 3: Targeting Customers and Gathering Information, Part 7: Communicating with the Customer, Social Media and Retailing, Strategy Mix | Tagged , , , , , | 1 Comment

Looking for a New Job? Consider These Questions

Do you ask yourself several relevant questions BEFORE starting a job search? You should. We’ve written about this before as part of our personal SWOT analysis.
Consider these observations from Tai Goodwin, writing for Careerealism:
“The perfect time to start your job search is before you begin feeling a desperate need to get out of your current position. One of the worst times to start a job search is when you feel like your back is up against the wall.”
“Deciding to search for a new job, regardless of the labor market, can be both exciting and frightening. There’s excitement in thinking about new possibilities for your career and work-life. But thinking about the time, energy, and potential rejection involved in the job search process can be overwhelming.”
“For those who decide that finding a new job is well worth the challenges a job search will bring, a larger question looms: How can I be sure my next job will be any better than my last one?”
Click the image to read more and see 5 questions to consider BEFORE a job search.
 

 

Posted in Career Useful Information, Careers in Retailing | Tagged , , , , , | 1 Comment

Does Rebranding Always Work?

Many times, companies tinker with their logos, their slogans, and other branded materials. They want to “freshen” things up.
Four recent rebrandings (Gap, Starbucks, Vodafone, and AirBnB) are the subject of a recent analysis by Erik Devaney for HubSpot:
” If you’ve ever been part of a company or worked on a product that’s undergone a rebrand, you know how absolutely crazy it can be. From establishing goals, to iterating on designs, to actually implementing your branding changes on your Web site and across all of your marketing channels, it’s a lot of work.”
“I was part of a rebrand at a startup a few years back. The company at the time was shifting direction and targeting a different audience, so a rebrand made sense. We had to come up with a new name, new logo, new  colors  …  new everything! Needless to say, there were a lot of brainstorms, a lot of late nights, and a lot of general craziness right up until we flipped the switch on the new branding.”
 
Click the image to read about rebranding at Gap, Starbucks, Vodafone, and AirBnB.
 

 

Posted in Part 1: Overview/Planning, Part 2: Ownership, Strategy Mix, Online, Nontraditional, Part 3: Targeting Customers and Gathering Information, Part 6: Merchandise Management and Pricing, Part 7: Communicating with the Customer, Strategy Mix | Tagged , , , , , , , , , | 2 Comments

Overstock Hops On (Technology) Board

Overstock is a popular online discount retailer that sells a wide range of name-brand merchandise.
Recently, the company has sought to greatly expand and update its data-driven technology systems.
According to Chief Marketer:
“As everyone in retail and E-commerce is fully aware, changes abound within the industry. To accommodate these and future shifts while creating a personalized, data-driven methodology for meeting customers’ needs, Overstock needed to move to a data-driven marketing approach.” [It has!!]
Click the image to read about Overstock’s strategic technology changes.

 

 

Posted in Part 1: Overview/Planning, Part 2: Ownership, Strategy Mix, Online, Nontraditional, Part 3: Targeting Customers and Gathering Information, Part 5: Managing a Retail Business, Technology in Retailing | Tagged , , , , , , , , | 1 Comment

Have Banner Ads Lost Their Allure?

Each year, marketer spend millions of dollars on banner ads. With that in mind, a good question is: Do people actually look at these ads?
Recently, Canadian-based Prestige Marketing prepared a brief tongue-in-cheek infographic addressing the above question:
“Banner ads first appeared on the Web in 1994 and since then they have been used extensively over the Internet. They are made to be eye catching and impressive so that they create an urge in the visitors to click into their business. But, their mass production and misuse has caused viewers to be skeptical and unresponsive to them. Do people still fall for this attractive ad?”

 

 

Posted in Part 3: Targeting Customers and Gathering Information | Tagged , , , , , | 1 Comment

Learning How to Easily Develop a QR Code

QR codes are becoming much popular among consumers — especially with their use on mobile devices. So, is there an easy way to create QR codes? 
According to Cory Eridon, writing for HubSpot, the answer is an emphatic yes. He presents a four-step approach:
“For a few years now, QR codes have been one of the technologies at the center of the popular “___ is dead” trope we marketers love to argue. We’ve even debated it ourselves on this blog. But if there’s one thing this back-and-forth shows you, it’s that there sure isn’t a consensus. So this post is to help marketers who are interested in experimenting with QR codes, anyway. Keep reading to learn how to create your own, and how you can increase the chance of consumers scanning them.”
To learn more about how to create and use QR codes effectively, download our free guide to QR codes here.
Click the image to read Eridon’s four steps.

 

 

Posted in Part 3: Targeting Customers and Gathering Information, Part 5: Managing a Retail Business, Part 6: Merchandise Management and Pricing, Part 7: Communicating with the Customer, Technology in Retailing | Tagged , , , , , | 2 Comments