In this second of our four-part series, we focus on using communication and customer information to grow the value of your customer relationships. The married couple finishes sentences for each other is a cliché that illustrates the closeness in long-term relationships. And it’s true: Over the course of time in a long business partnership or marriage, each partner accumulates enough information to anticipate the other’s feelings, thoughts and reactions. The same can be true of your customer relationships. As you learn more about customers, you find new ways to connect and make your relationships stronger and more profitable.     “Working with customer and transaction data, patterns in behavior emerge that can signal potential purchases, raise loyalty issues and stimulate new thinking on how customers prefer to interact with your company.” Curt Powell Chief Marketing Analyst   The more you know, the better it gets In our last issue of First Perspective we discussed the importance of bonding with new customers by providing a warm welcome that sets expectations for the relationship. In the growth stage of the customer lifecycle, you can keep your relationships exciting for your customers — and make them more profitable for you by using your customer data to target customers with the products or services they want and need. Data mining to dig up new opportunities Knowing more about your customers is crucial to making your marketing relevant — getting the right offer to the right person at the right time. Data mining is a technique that uses statistical analysis of customer information to detect relevant patterns and predict customer behavior. It helps you identify your best opportunities for cross-selling or upselling additional products and services to customers who want them when they are ready to buy. Today’s computer technology provides market segmentation tools like Claritas PRIZMNE that make it possible to create a profile of your best customers. Using your best-customer profile, you can target offers to those customers or prospects who are most likely to purchase. It also allows you to pinpoint high-opportunity segments in your customer base you may not have recognized otherwise. More sophisticated tools offer richer customer analysis. According to First Marketing’s Chief Marketing Analyst Curt Powell, “Advanced data analytics tools, such as multiple regression analysis, predictive modeling, meta-analysis and text analysis, can profile the factors that lead to customer retention, profitability and growth. Working with customer and transaction data, patterns in behavior emerge that can signal potential purchases, raise loyalty issues and stimulate new thinking on how customers prefer to interact with your company.” Target your best customers and prospects Detailed, accurate customer information allows you to concentrate marketing resources in the areas that will provide the greatest return on investment. In addition, by targeting your offers and versioning customer communications, your messages become more relevant and timely. Customers appreciate and do more business with companies that make an effort to know them and meet their individual needs. Thanks to technology, it’s now possible to “know” thousands or even millions of individual customers. With your best-customer profile, you can also target “clusters,” or populations of noncustomers with similar attributes, for acquisition marketing. The right mix of communication tools Today’s research tools can also segment customers and prospects by their media preferences, allowing you to choose the most appropriate tools for growing customer relationships. Older, more traditional customers may prefer receiving a company newsletter, while younger, tech-savvy customers may want an e-mail version. Data mining makes it easier to produce trigger campaigns in which a customer event, such as an anniversary or renewal date, triggers a mailing or e-mail communication. Dynamic e-newsletters maximize relevancy because customers themselves choose the information they’d like to receive. Special customer-only offers are another effective way to use customer information. Look for more on using data analytics to reveal growth opportunities in future issues of First Perspective. Can’t wait? Contact us at marketing@first-marketing.com or call 800.736.0145.
In our next issue of First Perspective, we’ll discuss the retention phase of the customer lifecycle and ways to keep your best customers happy and profitable.
As Senior Vice President at First Marketing, Glenn Hetzel utilizes his 14 years of customer retention experience to ensure the consistent quality of communication strategy and creative production for Fortune 500 companies. Glenn can be reached at ghetzel@first-marketing.com.