Marketing ch 11 Flashcards
What are two things that successful database marketing emphasize?
Database marketing involves collecting and utilizing customer data for the purpose of enhancing interactions with customers and developing customer loyalty. Successful database marketing emphasizes 1) identifying customers and 2) building relationships with them. Although database marketing can be used for selling products, retention and relationships remain the primary focus.
What is the primary benefit of database marketing?
increase custoemr loyalty
Wht does a marketing databse contain?
This is a lsit of tyypes of information that should be contained in a marketing database. customer information is normally easy to obtain. especially for BtoB operations.It may be more difficult for consumer-based businesses. customer information that is needed includes names, addresses, email addresses and phone numbers. There should be a record of very vistit, to the firm’s website and every contact with e company. customer histories and results of any surveys should be in the database. Preferences. Profiles, and results of the marketing campaigns should also be there. It will be discussed later, but the database should also contain appended and coded data.
using geocoding, a company can add which of hte following to each customer’s record?
Geo-coding is the process of adding geographic codes to customer record so that customers can be plotted on a map. Geo coding also allows for adding demographic and pyschographic information to the customer’s record. with this information, customer clusters can be identified. using software such as CACI coder/plus. The concept behind the geographic cluster si the people who share common values and interests tend to live in the some neighborhoods. Combines demographic information with lifestyle data.
A lifetime value analysis creates a figure that represents what?
The lifetime value figure represents the present value of future profits a customer will generate over his or her lifetime relationship with a company. Some companies will calculate individual lifetime values for each person. Others will look at clusters of customers and calculate an average value for the cluster, or segment. Key figures needed for lifetime value calculations are revenue, costs, retention rate, and visits or purchases per time period. Revenue and costs associated with customers and customer clusters can normally be obtained. More difficult data to obtain are retention rates. The lifetime value figure represents the value of that customer (or customer segment) and provides an idea on how much effort should be expended to keep the customer and to upgrade him or her to a more loyal customer.
A lifetime value analysis creates a figure that represents what? Cluster:
Basically grouping up a market segment for lifetime value calculations are revenue, costs, retention rate, and visits or purchases per time period.
Coding can be used to group customers into clusters based on a wide variety of criteria. Once clustered, unique marketing programs can be created that would appeal to that cluster increasing the effectiveness of the marketing program. For instance, a bank may group customers based on the number of accounts it has, or the total number of dollars in all accounts within the bank. Then different marketing programs can be developed to upgrade each cluster with the hope of increasing each cluster’s value to the bank. Clustering can also be used for cross-selling other services or goods.
Location data tracking
Newest form of data analytics information provided by mobiule DPS technology. Ex. Verizon can track location of customer during sports event then gather information in regards to their activities after the event. This data is aggregated then hashed so that specific individuals are not identified.
location data tracking: Data mining
involves using computer data analysis software to mine data for meaningful information and relationships. Data mining is used to build profiles of customer groups and of a firm’s best customers. Then a search can be made for customers who fit this profile, but who are not spending at the level of the best customers. These individuals can then be targeted with special marketing programs or even personal selling. Data mining can also be used to prepare models that will aid in predicting future purchase behavior. Retailers can learn what other products a person buys when a particular product is purchased. Barnes and Noble uses this process when a customer selects a book to purchase; they tell the customer what other books were bought by purchasers of that particular book.
Be able to identify an example of trawling.
The process of searching the database for a specific piece of information for marketing purposes. Ex. Dealerships keep track of dat consumer purchased the car and send an anniversary email to offer deals for trading in to get a newer car. Home Depot keeps track of people that recently moved or might need home repair/maintenance. Or bday gift/discount.
What are typical goals for frequency or loyalty programs?
Frequency or loyalty programs offer consumers free merchandise or discounts for a series of purchases. The goal is to reward purchases and maintain a customer’s patronage with a firm and discourage them from purchasing from competitors. Airlines and grocery stores are the two most well known frequency or loyalty programs. About 2/3 of consumers belong to a frequency program, and the average household belongs to 14 different programs. They actively participate in six programs.
(prob used in high competition markets)
What are the 2 primary metrics in customer relationship management (CRM) programs?
Customer relationship management (CRM) programs were built on the premise of using database technology to customize products and communications to meet the needs of individual customers and to enhance their relationship with the company. CRM programs are built on two tenets – lifetime value and share of customer. Share of customer refers to the percentage of purchases a customer makes with one firm compared to the total expenditures in that product category.
customer relationship management (CRM) program: Share of customer
refers to the percentage of purchases a customer makes with one firm compared to the total expenditures in that product category.
