Get personal with database marketing

Get personal with database marketing

Database marketing is a way of using technology to personalise marketing communications and make them more effective for your company. The idea is pretty straightforward: you collect data about your customers, you interpret that data, and then you use that data to make what you say to them more relevant and personal.

Think of relevance and personalisation like this: you might have a favourite coffee shop. And of course, the coffee has to be good—but it’s also notable that the person behind the counter in there knows your name and your regular order. You appreciate that, because it means every time you interact with the coffee shop, the experience is personal and relevant to you. In the end, the value of database marketing is in creating a similar kind of user experience. But it means taking the required information and sticking it in a computer database instead of inside the heads of customer service staff.

And it turns out that customers? Well, they love it when you get up close and personal. Here’s an example: one of the most basic ways you can personalise your marketing communications is to make sure you’re including your customers’ names when you contact them. The benefits of even this basic level of personalisation are clear: Campaign Monitor reports that marketing emails with personalised subject lines are 26% more likely to be opened by their recipients.

If you have the information you need stored in a database, you can automate a portion of your personalisation so you can reliably and cost-effectively do it at scale. That means that any customers interacting with your marketing get the benefit of personalisation when you ‘remember’ their name, history, preferences and other details.

There are many benefits to database marketing. You can use the data you collect to:

• create detailed and narrow segments to receive specific messages
• contribute to customer profiling, which can help you attract and communicate with future leads
• streamline your marketing campaigns and improve ROI by avoiding waste and
• improve your customer experience by tracking activity and empirically measuring outcomes

Database marketing is also a useful way to ensure that the information you collect about your customers is held within your organisation’s systems, so it won’t vanish into thin air if a staff member moves on.

There are clear benefits to creating this more intimate connection with your customers.

But, to be successful with database marketing, you need to have a database that gives you a thorough and complete view of your customers, and it has to be up to date and accurate. So there are some things you must consider regarding your data:

• Data degrades over time. Often called ‘data decay’ or ‘data degradation’, this is a concept that people don’t always consider. When you collect information, it is true at the time of collection—a nice little snapshot image of your customers. But that doesn’t mean that it will remain true forever. Some portion of your collected data becomes untrue every day as your customers change email addresses, phone numbers, preferences, geographical locations, and so on—this comes out to about 30% of your database each year. Over time, you get bigger and bigger chunks becoming inaccurate. It’s inevitable. But it does mean you need to make sure the data you’re holding gets regularly updated. Luckily, these days you can automate a lot of day-to-day data management tasks.
• Customer privacy is important. Obviously, it’s important because it’s protected by legislation, like the Spam Act or the Privacy Act, and you don’t want to be the next company to get fined $1 million for sending just 798 emails. But copping a big fine isn’t the only reason why your customers’ privacy should be important to you. Just as with any relationship, you want them to feel valued and respected. Your customers should be able to trust you to be a sincere and responsible custodian of their personal information—and if you’re not, then they don’t have much reason to hand it over to you!
• You need to know what you actually want to do with your data so you can maximise the usefulness of your database. Collecting data that you don’t use for any sensible business purpose only increases your privacy responsibilities and takes up space without offering any conceivable benefit—so make sure your marketing database is set up to collect the data that you actually need and will use. If you’re basing your marketing on customer activity, then you need to make sure you have fields to collect that information, but it won’t be as useful to know if someone’s male or female.