Chapter 11: Database and Direct Response Marketing and Personal Selling Flashcards
Define database marketing
Involves collecting and utilizing customer data for the purposes of enhancing interactions with customers and developing customers loyalty (it is comprised of identifying customers and building relationships)
What is a data warehouse
A data warehouse holds all customers data this includes -
1) the operational database: which contains the transactions individuals have with the firm and follows accounting principles
2) the marketing database: which contains information about current customers, former customers and prospects
What comprises of the marketing data warehouse
- customer names and addresses
- email address
- records of visits to the company’s website
- customer history
- customer survey results
- preferences and profiles
- marketing campaign results
- appended data
- coded data
What are the tasks in database marketing
- building a data warehouse
- database coding and analysis
- data mining
- data driven marketing communications
- data driven marketing programs
Explain database coding and analysis
- Personalised communications
- Marketing campaigns
- Common forms of coding (lifetime value analysis & customer clusters)
Explain lifetime value analysis
Represents the profit revenue of a customer throughout the lifetime of a relationship (individual lifetime value & customer segment lifetime value)
Explain customer clusters
Group customers into clusters and develop unique marketing programs for each cluster
Explain data mining
Involves using specific software to study data to find meaningful information, and help enhance relationships.
Purpose of data coding and data mining
- Develop marketing communications
- Develop marketing programs
- For personal sales (qualify prospects & information for sales calls)
Explain database-driven marketing communications
- Identification codes: start with assigning individual customers identity codes and passwords that allow them to access website components that are not available to those who visit the site without logging on
- Customer profile information:
- In-bound telemarketing: contacts made by telephone work the same way as Internet contact. The service operator immediately ceased identity of the person calling
- Trawling: the process of searching the database for a specific piece of information for marketing purposes
Explain permission marketing
A program in which companies send promotional information to only those customers who give the authorisation to do so (can be offered through internet, telephone and mail)
What are the steps in building a permissions marketing program
- Obtain permission
- Offer a curriculum over time
- Offer incentives to continue the relationship
- Increase level of permission
- Leverage the permission to benefit both parties
Explain database driven marketing programs
- Permission marketing
- Frequency programs
- Customer relationship management
Keys to successful permission marketing
- Ensure recipients have granted permission
- Make e-mails relevant
- Customise program by tracking member activity
What are reasons customers opt into email permission programs
- sweepstakes or chance to win
- found site randomly email required to access content
- already a customer
- friend recommended
- interesting content
- account status updates
- contests and
sweepstakes - price bargains
- entertaining
Explain frequency programs
A company offers free or discounted merchandise or services for a series of purchases in a frequency or loyalty program
What are the benefits of loyalty programs
- Discounts and savings
- Better deals and offers
- Free products
- Cashback
- Individualised attention and recognition
What are the goals of frequency or loyalty programs
- Maintain or increase sales, margins, or profits
- Increase loyalty of existing customers
- Differentiate the brand
- Discourage entry of a new brand
What are the two principles of frequency programs or loyalty programs
It is added value and reciprocity - participants should feel value accrues from belonging to the loyalty program
Explain customer relationship management (CRM)
Programs that make it possible to employ databases that customise product and communications with customers, with the goals of higher sales and profits
Built on two primary metrics:
– Lifetime value:
– Share of customer: percentage of expenditures a customer makes with one particular firm compared to total expenditures in that product category
Explain direct response marketing
Targeting of products to customers without the use of other channel members
List the different methods to carry out direct marketing
- Direct mail (types of commercial lists: response list, hot list, compiled list)
- Catalogs
- Direct response mass media
- Internet
- Direct sales
- telemarketing
Explain personal selling
Personal selling offer a face-to-face opportunity to build relationship with customers
What are the seven steps in the selling process
- Generating leads
- Qualifying prospects
- Knowledge acquisition
- Sales presentation
- Handling objections
- Sales closing
- Follow-up
