The evolution of targeted marketing are you ready for the fourth wave?

November 9, 2009 at 9:49 pm Leave a comment

The Evolution of Targeted Marketing   Will you be ready for the fourth wave?

by Mike Schmitt

 While it goes without saying that these are trying times for organizations across the board, there has never been a more important time to market your company. Times like these prove that effective marketing can guarantee your survival during a down economy. Because there are fewer consumers willing to spend on your products, target marketing will help you deliver on the promise of spending less for a higher return.

 During a time of economic distress the CFO rules. This spells trouble for mass media investments as the hard dollar ROI is often difficult to measure, let alone prove. Targeted marketing to the rescue. The CFO will appreciate the fact that you are sending offers exclusively to people who are determined to be good candidates for your products and overjoyed to learn that you will be able to directly attribute marketing dollars spent to revenue generated.

 Brief History of Targeted Marketing

 We can look at targeted marketing in waves. The first wave of basic segmentation finally moved (most of) us away from “junk mail” or unsolicited promotions. Offers became relevant based on demographics such as gender, household income and lifestyle traits.

 The second wave was defined by “actionable” consumer data and personalization solutions for both traditional and emerging media. Intuitive companies realized that their very own customer data, including their transaction history, allowed for a new class of both segmented and highly personalized targeted marketing. The really smart marketers enhanced their customer data with geographic, demographic and lifestyle information. So, the right offer got to the right person and with a relevant message to the recipient. Now a company could actually spend less on marketing campaigns and expect a higher return.

 Second wave marketers, however, were lacking a true connection with the consumer. Direct mail continues to be the medium of choice for prospecting, and variable data print has given new life to this proven method of product and brand promotion through the ability to cost-effectively personalize each printed document. The proof to me that the cost of personalization had become reasonable, to even the smallest business, was when our dog Max received a personalized postcard from our veterinarian!

 Importance of the Consumer Database

 We know that most companies have some form of customer database, as well as a transaction master. We also know that a significant number of companies have very poor and scattered data. Customer data is duplicated in several departments, mailing addresses are fairly outdated, little or no data verification (mailing, email, telephone) systems are in place and the list goes on-and-on. Bad data basically means that any attempt at targeted marketing will result in a poor response to the campaign. More importantly, the potential actually exists to lower lifetime value as you may send a very negative message to your customer.

An extreme case involves a hospital that sent out a promotion for a cancer screening, which targeted elderly people within a certain radius of the hospital. The hospital received a call from an upset woman who thought it was in poor taste to be included in the promotion, when her husband had recently passed away and at the very same hospital. Another person received multiple, redundant offers and wondered about the quality of the care if they were unable to even get a mailing correct. The message here is to spend the time and effort on the database, before any form of targeted marketing is considered. Everything is better with a good database. Your analytics and reporting will tell the true story, and you will have the confidence to launch highly personalized marketing promotions knowing your data is accurate.

 Integrated Cross-Media Marketing

We are now just entering into the third wave. Savvy marketers are branding their products and images in a consistent way and across all traditional and emerging media. While newspapers are getting roughed up by the Internet and network TV is competing with cable, all media remains important. Marketers are working to have consistent messaging on the web, traditional media, mobile phones (which greatly outnumber personal computers) and on email. Many marketers are also trying to figure out how to exploit social media (e.g. Facebook, MySpace, Twitter), but that is a topic unto itself. Thankfully, there are variable data composition engines that will produce output for emerging presentation spaces (e.g. mobile screens) and the ubiquitous 8.5″ x 11″. The new breed of composition engines help marketers format any given promotion to all sizes and resolutions required for cross-media marketing. Mobile, web, email and direct mail are all supported so the designer can concentrate more on the messaging and less on the presentation space. This is not to say that we can ignore the fact that a mobile webpage must be radically different than a typical PC web browser page, but the designer can prototype the various formats to ensure consistency across different media. This is far superior to using different design tools for different media.

 Marketers have also learned that some marketing messages are better sent as printed documents, while others are more suitable for electronic communications. Email, thanks to the spammers, continues to be a tough way to prospect as it is very hard to get through the clutter. Many marketers realize that direct mail can be used to drive online communications. Companies should determine the individual preferences of their customers and this means supporting traditional and emerging media; many direct marketers are predicting an explosion in mobile marketing. Americans love the concept of instant gratification, and the mobile phone gives the consumer an opportunity to respond to a promotion anytime, anywhere. As a marketer you get the chance to respond while the consumer’s interest is at its peak. Send a mobile coupon while asking for their email address – fully integrated and automated cross-media marketing.

 Marketing Nirvana – The Fourth Wave

 The fourth wave of targeted marketing can be characterized by the consumer managing their marketing communications from both a timing perspective and the channel of delivery. Imagine a consumer registering in a global marketing database their desire to purchase a diamond tennis bracelet within the next 60 days. Now also imagine that they prefer to receive mobile offers while commuting to-and-from work, email during the work days and direct mail at home on the weekends. Fourth wave marketers will have the ability to promote to people who are looking at the products they sell, during the time frame that they are interested, and through the channel the consumer has selected. Respecting the wishes of the consumer will reward the marketer with highly qualified prospects and nothing else.

 Marketers that have developed the infrastructure and processes necessary, to capitalize on the opportunities presented by the fourth wave, will obviously have a significant competitive edge over their rivals. I believe that consumers will respond positively to advertisers who spend the time and effort to fully understand their preferences for marketing communications.

So, get your consumer database ready — the fourth wave is a marketing tsunami that will wipe out those who ignore the signs.

Prisma Graphic works closely with Mike Schmitt, CEO of Clairvoyix, to provide our clients options that meet their targeted marketing goals. To discuss how we can help your company stay in front of direct marketing trends, please contact your current Prisma Sales Representative, or Rob Steele at 800 379-5777 or
 robs@prismagraphic.com.

 Clairvoyix is a full-service direct marketing company with a core-competence in database marketing and marketing automation solutions. Delivered as a “Software as a Service”, its branded database (Clairvoyix Knowledge Factory), is the foundation for fully-integrated, cross-media targeted marketing. Clairvoyix directly supports personalized communications utilizing any media type including direct mail, email, web, PURL and mobile campaigns. From customer data hygiene and consumer data enhancement to analytics and campaign execution, their company offers a complete targeted marketing solution for clients of all sizes. Call 877 866-8693 x709 or e-mail mike.schmitt@clairvoyix.com  for more information.

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