Get the Most Out of Your Marketing Database

Many catalogers use their marketing databases to look at response data for list analysis and segmentation or for data modeling — all good stuff that can benefit your campaign results.

But there may be dozens of other benefits you can reap from your data — benefits that come from analyzing transactional information of what’s being purchased along with the response information of who is buying. Then you can use those data to build a more effective catalog.

Five Steps to Success

Following are five steps that can help you get the most out of your marketing database.

1. Look at what’s being bought by which kind of responders.

When you meld together your response information and product data, one of the first things to look for is the difference between what your prospects and your customers buy. Once you understand this by product category, and even by individual product, you can begin to build each catalog to its particular audience.

For example, if your October mailing has the largest percentage of prospects, then you’ll want to:
- put your most-effective item to prospects on the front cover;
- lead the catalog with the category that works best for prospects;
- put proven prospect-grabbers on the back cover.

If results really are different between prospects and customers, consider a prospect version and a housefile version of your catalog.

Likewise, if you have catalog drops that mostly are sent to existing customers, be sure your best-performing categories to customers are presented, and put new items in prominent places. Your database even can tell you how well your new items work to customers vs. your best pickups.

2. Determine what are your best-performing categories.

By doing this, you also may be able to discern which categories have the best long-term value for your catalog. This is similar to what you probably already do with your rental-list results: Understanding which lists provide the best long-term customers may compel you to continue mailing to outside lists that don’t quite meet the cutoff initially, but provide good customers who more than make up the loss during the next year or two.

Your goal here is to understand what kind of customer you attract for each category — especially important if you have a general merchandise offering with products in several major categories. It’s helpful to know which categories produce not only immediate response and dollar results, but which snag the best long-term customers. You may find that someone who buys in category A is a much better customer during a three-year period than someone who buys from category B — even if category B looks better initially.

Discovering the number of customers who respond to a category and their value over time vs. another category could encourage you to increase the space and number of offerings in that category. Such information also could change your opinion about a category that didn’t look all that productive when you examined only its initial sales results. The category’s real strength may be seen in the long term, and your database can help you discover that.

3. Determine what are your best-performing price points.

Specifically, you want to know which price points produce the best customers over time, which are best for snagging prospects and which price points your customers prefer to purchase. Understanding this information by customer type, or even down to the rental list, can help you decide what future moves to make, just like you would with product-category information.

Once you know your best price points by customer group or list type, you can decide if you should offer more or less of a certain price point, and it even can help you determine future list-rental opportunities.

4. Scour your database to see which products usually are bought together.

Product or category affinities can yield some interesting information, too. Once you know which items or categories are most likely to be bought together, you can support that purchasing behavior by merchandising those items close together or even bundling them into one presentation if it makes sense.

Additionally, if your best customers are those who buy more broadly across your product categories, develop a plan to entice single-category buyers to purchase outside their normal categories. This may make them more valuable customers to you. Test a special offer with purchase of something else, or simply show key products across categories together on a spread.

You may find that a lot of new-to-file buyers who purchase again in the next six months tend to buy a certain combination of items or categories. Place those items close to one another and in hot spots on your catalog pages, thus hopefully creating more of the kind of buyers you want on your file.

5. For a marginal-performing pickup item, use your database to help you decide if you should keep or drop the product.

Usually catalogers have a pretty good-sized pool of potential pick-up items for the next catalog edition. The big question with any pickup is: Should you drop it and try something new, or should you go with the known item and try to improve its performance? To help you answer that question, turn to your database to discover a bit more about the kinds of buyers who responded to that item.

For example, let’s say you’ve been running a certain teapot for four catalog issues. Sales for the item started out pretty strong, but now are barely paying for the product’s space. You’re thinking of dropping it and trying some other tabletop item.

To help you decide, check your database to see what’s happened to the customers who’ve purchased that item. Perhaps they respond more frequently or have a higher average order value than your average customers. Or perhaps buyers of this teapot consistently don’t respond again. This type of data can help push you and your merchants in the right direction.

Hopefully these five strategies will inspire you to dig in and find the jewels lurking in your data.

Phil Minix is vice president of catalog marketing for Reiman Publications. You can reach him by e-mail at pminix@reimanpub.com.