A Marketing Database-Your Business' Central Nervous System

In this day Web 2.0 of blogging, websites, search engine marketing, and You Tube, we lose site of the most important fact in marketing. Each of these vehicles represent different contact points of your business' prospects and customers. The "central nervous system" of all this information was (and still is) a "marketing database".

The late Bob Stone in his book, "Successful Direct Marketing Methods, 7th Ed (co authored by Ron Jacobs), defined direct marketing as follows:


"Direct Marketing is the interactive use of advertising media, to stimulate an (immediate) behavior modification in such a way that this behavior can be tracked, recorded, analyzed, and stored on a database for future retrieval and use."

The database, and I will refer to it as a "marketing database", is a central part of direct marketing. Without a means of collecting all the information into a logical and meaningful order, your marketing will fail because you lose the ability to track and analyze each campaign's effectiveness and ROI.

What is a database? It is a collection of information stored on a computer. A "marketing database" is more than a name and address of an individual or company. It is a collection of customer and prospect information from all contact points. Contact points include in part:

• Search Engine Marketing visitors to your site (that left some contact information)
  
• Inbound telephone
• Direct Mail Responses
• Sales orders-on or off line
• Prospects: website visitors, catalog requests, BRC's responses, post cards for additional information, subscribers, past customers etc.
• Responses from Infomercials
  

A marketing database collects and organizes this information and has at least the following pieces of information:

• Name
• Address
• Telephone number
• Source of customer or lead
• Email address
• Ongoing sales information related to each contact/purchase-(date of sale, sale amount, number of purchases, skus purchased)
  
• A unique identifier for each record on the database
• Responses (and their key codes identifying the specific campaign and media) from all campaigns linked back to the specific recipient.

Having this information, you can begin to develop multiple initiatives. They are designed around the data collected to improve marketing initiatives, and identify historical customer value to your organization. These are not mutually exclusive. The more analysis you perform improves future marketing campaigns. These initiatives fall into two broad categories:

• List segmentation for marketing campaigns
• Customer analysis of data

List Segmentation

• Segmentation by Sales -conduct an analysis by RFM-Recency, Frequency and Monetary variables. These are three metrics found on any transactional database. Having this kind of analysis will identify the old "80/20" rule. 80 per cent of your sales come from 20 percent of your customers. Identifying who they are and having the ability of scientifically selecting them saves a lot of wasted advertising dollars.

• Select by trigger event-maintain and update RFM information on each customer. Evaluate the change in behavior month-to-month. If there is a decrease at a set amount, say 10%, pro-actively create marketing programs to change the customer's behavior.
  
• Segment by Communication Channel response information to identify best customer or channels of communication. For example, you can evaluate ROI by channel. You might find that a two step lead generation and telephone follow-up produces a higher ROI than mailing a large catalog for an immediate sale.

Data Analysis

• Use analytical information to pro actively trigger marketing campaigns. For example, update your RFM scores. Based on the customer's historic value, create a VIP club with sliding scale of rewards. The more valuable customers receive greater rewards.
  

• Overlay demographic or firmagraphic information onto your marketing database. Identify customer penetration by demographic or firmagraphic criteria. When I worked at a b-t-b catalog marketing company, we overlayed SIC code and employee size data. I found that there were significant pockets of customers in SIC codes other that our core groups. Based on this profiling, I looked for advertising vehicles reaching the uncovered SIC's.

• For more sophisticate analytical procedures, conduct a model to predict behavior. You will need a specialist for this who understands statistics and data. The beauty of this procedure is that you are able to predict behavior and identify the likelihood with a certain degree of probability that action will take place. You can select only those customers or prospects most likely to exhibit that behavior. This saves you a lot of money because your advertising dollars are spent on those people most likely interested in your service.
  

The size of your customer base and your technology budget will determine your database software needs. For many small companies, a MS Access database is sufficient. You have to know database technology to properly set it up. Access databases can easily accommodate several hundred thousand records. If you do not know database design, you can contact us for a consultation.

If you database is larger, you probably would go onto some server such as SQL or even Oracle. You would need technical experts who would maintain this data for you. There are also online databases, but I do not know or recommend any company.

In summary, you can lose site of the key components needed for marketing in Web 2.0. You need a professionally designed website, email communication, direct mail AND a database to maintain in a logical order all of this valuable marketing information. Without a database to analyze the data, you could be spending a lot of advertising unwisely.
By Eric B. Mohr/EBM Direct Marketing Services LLC ©

Effective Email Marketing Strategies

Email marketing is a cost effective communication channel. If used correctly, and not abused, your business will benefit. When marketing via email your business has to comply with CAN-SPAM (Controlling the Assault of Non-Solicited Pornography and Marketing Act) regulations enacted into law in 2003. These are FEDERAL regulations for all commercial enterprises engaged in email marketing.

CAN SPAM was enacted due to abuse by companies engaged in spam-unwanted and unsolicited email flooding your in box. Briefly, the law stipulates:

• "It bans false or misleading header information. Your email's "From," "To," and routing information – including the originating domain name and email address – must be accurate and identify the person who initiated the email"
• It prohibits deceptive subject lines. The subject line cannot mislead the recipient about the contents or subject matter of the message.
• It requires that your email give recipients an opt-out method. You must provide a return email address or another Internet-based response mechanism that allows a recipient to ask you not to send future email messages to that email address, and you must honor the requests. You may create a "menu" of choices to allow a recipient to opt out of certain types of messages, but you must include the option to end any commercial messages from the sender.
• It requires that commercial email be identified as an advertisement and include the sender's valid physical postal address. Your message must contain clear and conspicuous notice that the message is an advertisement or solicitation and that the recipient can opt out of receiving more commercial email from you. It also must include your valid physical postal address.
• Each violation of the above provisions is subject to fines of up to $11,000. Deceptive commercial email also is subject to laws banning false or misleading advertising.

Having said this, email marketing, should be embraced. There are programs and services that are geared for marketers of all sizes. Constant Contact is a web based email marketing solution specifically geared for small to mid size businesses. The software is CAN SPAM compliant so the small business does not have to worry about out in or opt out.

Two terms you have to know in email marketing are:

• OPT IN- is when an individual grants permission for you to include their email address in any email solicitation.
• OPT OUT- is when the same individual elects to remove their name from any email solicitation.

There are multiple objectives in email marketing including;

• Building your opt-in email list
• Segmenting your email list
• Analyzing your email program
• Integrating your email marketing with other on and off line communication channels
  

Building your opt-in email list
There are many approaches open to building an email list. Once such method I discussed in an earlier post entitled "Using Event Marketing And Your Website". They do not have to be complicated. Some include;

• Have 3x5 cards or a sign in book near your cash register with a sign "join our email list". You or someone at your business will have to manually enter the information.
  
• If you have a website, create a customized form that people fill out (online). The data is stored on a database for retrieval. This is a preferred method because you are saving a significant amount of money by having the consumer enter the information. You can also build in validation rules to insure accuracy of the information.
• If someone purchases from your establishment, ask for their contact/email information.
• Create a VIP club
• In restaurants, leave a post card on the table with the check. The post card asks for their contact information for future event notifications.
• If you notice on my blog, I have a link inviting readers to be added to my email list. If you have a website that does not provide forms to enter visitor information, you can put some html code on the site, provided by Constant Contact, that will direct the visitor to a data entry form created on your Constant Contact account.

Segmenting Your Email List
As with any direct response program, you want to target those recipients most likely interested in your product or service. Because email marketing does not have the high fixed costs associated with traditional direct mail, people are prone to email everyone. I think this is a mistake. You want to target only those people who will most likely have an affinity to your email. Equally important, you do not want your customers or prospects to think you as flooding their in boxes with solicitations that do not interest them. Remember, your recipients have the legal right to opt-out which you must comply. So it is in your best interest to heed this advice.

In order to accomplish this, you have to know a little about your contact. When asking for their email address, also ask a few, but not many, questions about their likes. For example,

• If you sell clothes, ask what type of cloths interest them
• If you are a restaurant, ask if they are a business, are they interested in parties, catering, etc.
• Whenever I send emails, I provide a link in my email for the recipient to update their account. I created in Constant Contact broad categories of solutions that I provide. The responder can check off any solution that are listed. I create a customized email dealing with that solution emailed to that audience
  

Analyzing Your Email Program
A direct response program, to be effective, has to be based on Return on Investment (ROI). You want to choose your communication channel based on how much money you made relative to your investment. There are many different communication channels open to you. They include:

• Email marketing
• Solo direct mail
• CO-OP direct mail
• Newspapers
• Free Standing Inserts
• DRTV -Direct Response Television
• Radio
• Text Messaging
• SEARCH (SEM/SEO)

Many SME's marketing is haphazard. All marketing results have to be tracked, analyzed and stored on a database. The easiest way to identify each response or sale is to code the initial advertisement during it creation and request that source code for the response. For example:

• When driving traffic to your website from an event marketing, provide a source code specific to that event that has to be entered along with their contact information.
• When responding to a direct mail piece, ask for the source code.
• DRTV and Radio can also ask the viewer/listener for source code information when ordering.

When responses come in and tabulated, you are analyzing the effectiveness of each program by the source code. Make sure you keep track of each source code, the promotion, type of advertising, data of advertising, how many people were involved, expenditure (cost) for the ad.

Integrating With All Advertising
Now that you know your ROI, you can consider your email marketing in relation to the ROI of all your advertising. You will make sound, financial decisions, enable you to select which communication channels to use to achieve the highest ROI and fall within your overall marketing budget.

By Eric B. Mohr EBM Direct Marketing Services LLC ©

Promotional Products For Long Term Exposure

There are various ways to promote your business. Direct response promotion is immediate. But businesses and consumers are bombarded with advertising every hour. They include;

• Radio
• TV
• Outdoor advertising
• Flyers
• Infomercials
• Print-(magazines, newspapers, etc)

So the question is how do you maintain your business' mind share in the marketplace long after the promotion?

A solution, that has been around for over 200 years, is called promotional products. The industry can be traced to commemorative buttons issued in honor of George Washington's inauguration.

Wikpedia defines promotional items or promotional products as:

"articles of merchandise that are used in marketing and communication programs. These items are usually imprinted with a company's name, logo or slogan, and given away at trade shows, conferences, and as part of guerilla marketing campaigns."


Promotional Products is a multi billion dollar industry. According to Timothy M. Andrews President and CEO of ASI, (Advertising Specialty Institute) 2007 sales reached $19.6 Billion, up 5.4% from 2006.

The marketing approaches you take are only limited by your imagination. With the age of the internet, you can search websites for product idea. You can use distributors to provide expert guidance in this type of marketing. A distributor has access to all promotional product manufactures.

One of the oldest distributors in the country, dating back to 1920, is Larick Associates Inc. Their website, www.larick.com contains almost 800,000 items to peak your marketing mind.

So what are the ways to use this multi-billion dollar industry:

• Video Message Pens-this is a pen with the capability of displaying up to 6 different messages through a cut out in the barrel of the pen. When you "click" the pen to write, the message appearing in the barrel rotates to the next message. You can also have your company name and address imprinted on the barrel. Great leave behind at sales presentations, with customers and at trade shows.
• USB Drives-all computers today come with USB drives. You can place your company logo and message on the outside of the drive. The drive can contain customized product messages, drive people to your web site etc.
• T Shirts-when someone is wearing your t shirt, they are advertising your company, services etc. These are great handouts at experiential marketing events (i.e. college spring break) and other guerrilla marketing venues.
• Computer laptop bags-as an example-a well know college's law school hands computer lap top bags out at incoming orientation. The bags have the college name and logo. They are a walking bill board.
• USB Hubs-it is a hub that connects to your computer via a USB socket. The hub has multiple USB connections allowing multiple USB connections to your laptop or computer via one USB port. The hub is imprinted and sits permanently on your desk top offering visible advertising of your company and brand.

For additional information on these ideas, please feel free to leave a post or email us. If you are interested in receiving periodic emails on our solutions, please join our opt-in email lists

Eric B. Mohr, EBM Direct Marketing Services LLC © 2008