Spiller5e PPT02
Spiller5e PPT02
Spiller5e PPT02
Data-Driven
Marketing
© Lisa Spiller
Chapter 2
Database marketing and
customer relationship
marketing
Chapter spotlight
3
Customer database defined
4
A customer database is…
5
Why do loyal customers generate
more profits?
• Loyal Customers …
– Increase their spending over time
– Cost less to serve than new customers
– Generate word-of-mouth advertising or referrals
– Are less price sensitive than new customers
6
Database development process
7
An example of how loyalty programs
are driven by customer databases
8
Managing Source Data
9
Types of source data to collect
to build a customer database
• Customer’s Name
• Address (including ZIP code)
• Telephone Number
• E-mail Address
• Means by which customers first learned about the company
• Past Purchases (Transaction Data)
10
Database RFM assessment:
Recency/frequency/monetary
• Evaluates customers with respect to their transactions
– Recency – how recently
– Frequency – how often
– Monetary – how much money spent
• Weights vary
• Helps determine future potential of customers
• *See example in text
11
The need for database maintenance
12
Database maintenance: Creating
match codes
• An abbreviated name/address record
• Allows each record to be matched with other records
• A match code is generated for each name on the list
13
Database maintenance: Merge/purge
process
• A process using match codes to identify and delete duplicate
names and addresses
• Keeps house lists from being duplicated
• Can remove names that requested no solicitations
• Can identify ‘multibuyers’
14
Three ways to keep database records
current:
• Change of address investigations
• Nixie removal
• Record status updates
15
Database security – Protection
• Information Privacy
• Proper Database Storage
• List Marking – ‘salting’ or ‘seeding’
16
Customer databases’ enable stealth
marketing
• Ability to communicate with small market segments or
individual customers without other customers knowing
• Able to extend different types of offers to individual
customers on the basis of their personal information
17
Common uses of a customer
database
• Profile Customers
• Retain Best Customers
• Thank Customers for their Patronage
• Capitalize on Cross-Selling/Continuity Selling
• Develop a Customer Communication
Program
• Perform Marketing Research
• Generate New Customers
• Send Customized Offers … and MORE!
18
Communication plan
19
Example of using a database to
obtain new customers
20
Performing database analytics
21
Three reasons to enhance a
customer database
• To learn more about the customer
• To increase the effectiveness of future promotional activities
targeted to current customers
• To better prospect for new customers who are similar to
current customers
22
Customer relationship management
(CRM)
• To identify ‘touch points’ between the business (company)
and its customers and prospective customers
• To target customer needs to maximize the customer’s
experience and overall customer satisfaction
• Customer journey maps
• I-CRM
23
Customer journey map
24
I-CRM
25
Customer value
26
Lifetime value of a customer (LTV)
27
One-on-One Personalisation
28
Partner relationship marketing (PRM)
example
29
Cause-related marketing example
30
Case
• Nevada Tourism
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