July 29, 2007

Best Customers

There is an amazing difference between "new" forms of direct marketing (like paid search) and classic direct marketing.

Paid and natural search is all about intercepting a customer when the customer has a need. You don't necessarily know if this customer is your most loyal customer, or one who has never heard of your brand.

Classic direct marketing is all about "pushing" a message at a customer. And in order to get the best return on investment, it is perceived that it is best to "push" your message at "best customers".

Take your average multichannel retailer. If you believe in the old adage that "multichannel customers are your best customers", then your marketing efforts have to be focused on these individuals.
  • If you are launching a new catalog title, you'll send it to this individual.
  • If you are moving from one e-mail campaign per week to two e-mail campaigns per week, you'll want the new campaigns blasted to the best customers, giving them the best chance to succeed.
  • If postage costs are chewing up your profits, you are unlikely to pull back spend among your best customers, who spend enough to offset increased costs.
  • If you're having a store event, you'll want to notify your best customers about the event.
  • If you're opening a new store, you'll want to notify the best online/catalog customers in that trade area about the new store.
  • If you have a loyalty program, you want to reward your best customers, right?
In each situation, direct marketing activities are going to be focused on "targeting" best customers.

The majority of companies employ this type of strategy --- each marketing campaign is unique --- ignoring the targeting strategies being employed by future/concurrent/prior campaigns.

Is the "best" strategy one that focuses on "best customers"? We'll talk a bit about this topic this week. You are encouraged to offer your thoughts.