Direct Marketing Strategy - 2011 and Beyond (Part 2)

This post is a follow-up to yesterday where we began talking with Jim Sellers, our SVP of Marketing Services, about the new way to think about direct marketing.

  Buxton: So Jim you've said a couple of things here that perk my ears. When you talk about things a brand should be doing and suggest right off the bat that there should be an effort to drive all marketing activities from a customer orientation, that sounds like one of those “no duh” concepts that is shockingly obvious...until I try to explain it to myself. In your mind what are some indicators that there is a lack of customer orientation within an organization?  And what is the upside of adopting a customer-oriented mindset?  

Jim: As I am assessing an organization, here are the red flags that tell me there is not enough focus on the customer:

- No stable, practical, and measurable customer segmentation schema

- Reporting is product focused. Companies know what's being bought, buy not by whom

- Product and/or channel managers promote to the same customers with little or no coordination (or even knowledge) that they're hitting the same customers

- Promotional budgets allocated to products, not customer segments

- Pricing strategies are set at the product level. Little or no understanding of cross product price elasticities  

Now, the benefits for an organization who effectively adopts a customer centric orientation are numerous.  Some of the big wins include:

- Budgets allocated based on potential revenue upside by customer segment (across products)

- Reduction of inefficiencies that stem from different product groups targeting the same customer

- Customers see the company via its promotional efforts in a way that makes sense (based on how the customer consumes the company's products or services)

- Allows companies to understand and manage the customer lifecycle, acquisition, activation, growth, retention, and churn

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