Database Marketing

Reading retail sales, housing sales and consumer confidence reports the past couple of weeks while watching the stock market sink, I’ve become quite worried about the outlook for the holiday season for catalog/multichannel marketers. Retailers collectively reported their worst October in 12 years, and a Conference Board report last week said consumer confidence dropped in early November to its lowest level since Hurricane Katrina triggered soaring oil prices two years ago. Meanwhile, recent reports from the National Association of Realtors showed sales of existing homes had plunged to their lowest level in nearly a decade. None of this bodes well for catalogers. So

Say what you will about this wonderful trade we call the catalog/multichannel business, but whichever way you spin it, you can’t go very far if you’re unprofitable. That’s why above all else — the marketing, the merchandising, the creative, the e-commerce, etc. — we’re most interested in helping our readers make more money. So we bring you our annual binge of tactics and tips extracted from all of this year’s issues of Catalog Success, our weekly e-newsletter Idea Factory and our biweekly idea exchange e-newsletter, The Corner View. Our editorial staff went through every article we’ve produced this year to give you a nice,

When general merchandise cataloger Fingerhut was re-formed in December 2002 after being liquidated earlier that year by former owner Federated Department Stores (now Macy’s), the company’s foundation was its legacy file of customers who were active with the company prior to its closing. Over time, however, as the company grew to more than $300 million in sales as of the end of 2006, Fingerhut had to replenish those names with new ones. Realizing its housefile would dry up fairly quickly, over the next few years Fingerhut actively prospected building predictive models off its legacy file. “Fingerhut had a wealth of information available on

During a presentation of his firm’s new B-to-B co-op database, LexBase, at last week’s Direct Marketing Association (DMA) 2007 Conference in Chicago, Edith Roman Associates President Stevan Roberts presented a case study involving a 20-year-old (unnamed) cataloger that mailed 10 million catalogs per year and was looking to mail companies with more than 250 employees. “We took records from its file and matched them against our e-mail database,” Roberts explained. As a result, he claimed the cataloger increased orders by 26 percent within the first year. The cataloger sought out LexBase, which has been operational but not fully rolled out to all B-to-B

Patient: Doctor, although I have a consumer catalog, I’ve found some business customers on my list. I’m unsure of whether or not to try to find more business customers. Is B-to-B a good growth tonic for me, or a snake-oil serum? Catalog Doctor: B-to-B can be a good segment for some consumer catalogers to try to grow, especially if you sell business-appropriate gifts or productivity products. Plus, average order values can be double that of consumers, which can help cure slow growth and profitability. To grow that B-to-B segment, however, you need different treatments than you’re used to. Here’s a nine-step prescription. 1. Hang a welcome

AB-to-B catalog marketing staff had a problem. Its housefile count was experiencing double-digit growth, but its response numbers were shrinking. How can these two metric trends coexist? Internet-savvy consumers, who often operate small, home-based businesses, buy product via this cataloger’s Web site. These small office/home office (SOHO) businesses didn’t need to repurchase the way this cataloger’s traditional business customers typically did. So, housefile response fell, while marketing expenses went up. If you suspect this is happening to you, here’s how to fix the problem, improve your response and reduce marketing costs. Begin by analyzing your housefile for SOHOs and consumers. Then follow these steps: 1. Run address

While speaking last week at the NEMOA conference in Portland, Maine, Steve August, operational vice president of customer marketing for Brookstone, lauded the stability with which his company now can operate. That’s nice, but why? He devoted his session to explaining the Merrimack, N.H.-based housewares and electronics marketer’s “SUPER” marketing approach — SUPER being a self-coined acronym that stands for Brookstone’s new marketing campaign The SUPER campaign encompasses a Stable modeled environment, with a known Universe, Predictable performance, growth Expansion and a Reduction in costs. In its second year, the program was tested for a full year with a single model and a single

While your mailing list is the most important asset in your catalog business, your in-house database is the key to optimizing your mailing list. Relational databases are powerful marketing tools that allow catalogers many opportunities for understanding their customers and learning how to mail smarter. How do you use your database to its full potential? Dave Kuncicky, chief executive officer of equine catalog Chamisa Ridge, uses his company’s database to segment its customer base into product categories and to “find interesting things about customers. If you have several nonintersecting groups of customers based on what they buy,” he says, “you find two classes of customers

1. KEEP all channel and primary source data that lets you segment deeper than recency, frequency, monetary. RFM segmentation is no longer enough when mailing your housefile. 2. CAPTURE the original source for Web buyers whenever possible because you’ll want to segment by it. Price-comparison, shopping-engine buyers may respond differently than affiliate buyers, paid and organic natural search buyers, or Web buyers driven by your catalog. 3. DIVIDE your buyers by purchase channel. Segment traditional telemarketing buyers, Web buyers who purchased after receiving a catalog and Web buyers who’ve never received a catalog. Tag each order by purchase channel so you can identify

It’s no secret that if you use data correctly, you can add tremendous value to your company. The real key is the techniques to find and use this data to your advantage. That was the message offered during a session last week at the DMA’s List Day conference in New York. A panel — consisting of Erik Findeisen, co-founder/CEO of FC Data, a direct marketing consultancy; Janette Barret, director of marketing services and analytics for International Masters Publishers; and Hao Chen, manager of decision science at Experian Marketing Solutions — discussed ways mailers can drive up their return on investment through the use