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Data appending was rare and was done mainly by the largest companies. Today, many companies add demographic data (age, income, presence of children, credit ratings, and scores of other facts) to their customer database routinely. Business-to-business marketers add Dun & Bradstreet (D&B) data (SIC code, annual sales, number of employees) to all customer and prospect les. These data are used for segmentation and crafting of marketing communications. Customer segmentation was rare. Few companies had identi ed their Gold customers, or knew what to do with them once they were identi ed. Today many companies have segmented their customer base and have developed different marketing strategies for each segment. Communication with customers was mostly by direct mail or telephone calls. Phone calls cost several dollars each. Letters were also expensive. As a result, communications with customers were limited to monthly statements and sales calls. Today, because of the Web, scores of additional possibilities for communication with customers have opened up. Customers order on the Web, are thanked for their order, receive a con rming email, are noti ed by email when products are shipped, and are surveyed to determine whether the products arrived and were satisfactory. All these messages were impossible when database marketing rst began. Direct-marketing promotions were sent out by third-class mail in massive batches. They still are. But to this has been added email promotions to customers who have agreed to receive them. These email promotions cost almost nothing to send, compared to the heav y costs of direct mail.Customer preferences used to be requested through direct-mail or telephone surveys. These were expensive and, consequently, rare they were used mostly for research rather than for customized communication. Today, customers can, and do, complete their personal pro les via the Web, so that outgoing communications can re ect their preferences. Customers used to call toll-free numbers to get information on product shipments or technical data, and to ask for all sorts of information that was stored in a company s internal records. They still do. Increasingly, however, companies are making that information
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available to customers through the Web. This saves the companies millions of dollars per year and builds customer loyalty by giving the customers direct access to company archives. Models were rarely understood or used. Today all companies with products that involve churn, such as credit cards and cellular or long-distance telephone service, routinely use models to predict and forestall the canceling of service. This is an exhausting list. It shows where we were and how far we have come. Perhaps the development that has changed database marketing most profoundly in the past two decades is the advent of the Web. Today we can do things that we only dreamed about doing 10 years ago. We can truly build customer relationships with almost as many personal communications as the old corner grocers used to have with their customers.
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We can do all these things, but do they really produce more pro ts This is an area in which great strides have been made. Most companies are acutely aware of the need to use control groups to validate the effectiveness of every single marketing strategy and initiative. In this book you will nd more than 40 case studies that were completed in the past couple of years by companies that have been able to prove that their techniques are succeeding in building loyalty, increased sales, retention, repurchase, and reactivation. Customer communications work. Personalized communications work even better. Now, with the Web, we can afford to send millions of desired and accepted messages based on data and pro les in our databases that affect customer behavior in a positive way.
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