Seven keys to smarter database marketing

Seven keys to smarter database marketing

One of the most mystifying aspects of my time in digital marketing has been that although everyone has a database and does some level of database marketing, so few are getting full value from it.

Capturing the attention of a target audience is harder than it has ever been for brands.  They’re bombarded with content on a daily basis and have become extremely savvy in filtering out sales and marketing messages. Database marketing offers respite from attention scarcity. It’s permission based so the audience has to consciously opt-in. That means they are offering their time and attention up willingly to brands, an absolute gift in a world where attention spans have shortened to 8.25 seconds.

That’s why a strategic approach is so valuable, or what we have taken to calling smarter database marketing. Take for example an email address you’ve collected via your website. It’s common to throw it on the pile with the rest and blast it with sales messaging until it converts. That’s a war of attrition for the poor subscriber, some will unsubscribe, most will go dormant (which is by far the worst result that I will cover in future articles). You’ll see some conversions of course but at what cost? How many future conversions have you burnt in the process?

You have an opportunity to recognise database subscribers as people, to understand their needs and their maturity as a prospect or customer, in order to help them through the buying process. But don’t even stop there, smarter database marketing should continue post-sale, ensuring all customers reach their full potential, with the best given the tools to promote the brand as advocates. This is the essence of customer lifecycle marketing, a strategic approach to communicate more effectively through database marketing.

Below are seven principles we follow to deliver smarter database marketing. If you embed even a couple of these in your strategic approach, you’ll be streets ahead in most industries.

1. A database is full of people

When the details of a prospect or customer are submitted to the database of many brands, a weird thing happens. They cease to be people anymore and become a faceless data packet, tossed on the pile with all the others (fifty percent of marketers do no segmentation at all). This dehumanising of data is mostly done for convenience, it gives marketers permission in a strange way to blast out homogenous sales messages, one after the other after the other. And email being email, you will get some conversions that way and on that basis, the practice is justified and continues.

But let’s take the alternate approach for a second, let’s look behind each order number, each email address, and every phone number in that database and recognise the unique human being there. As people do, they’ll differ, some will be customers and some won’t, some will love you and others won’t, some will know a lot about you and others will know not much at all. You’ll be able to see this in your data, or if you can’t you can collect this data fairly easily, so isn’t it crazy not leverage it for some basic segmentation?

In an environment where audience attention is harder than ever to grab and hold, you have a group of people outright offering their time and attention, so long as you serve them relevant content. They way you do that is by recognising them as people, understanding they are at different stages of your customer journey, and accommodating them with content appropriate for their customer type and lifecycle stage.

2. They want to hear from you

This is a huge one and I’m surprised more isn’t made of it by my fellow database marketers. Database marketing is permission-based, which generally means at some point your contacts have made a conscious decision to connect with you. Yet so many brands miss a trick here when they use direct channels purely to distribute matching luggage from their current promotional campaigns, the core creative idea executed across above the line channels (tv, press, radio, outdoor etc) and then replicated for all the direct channels (email, social, mobile, direct mail).

The problem here is you’re taking messaging designed to disrupt a cold audience and serving it to a customer that has already met you. The same message that barges uninvited onto the TV of a family enjoying the latest episode of “The Voice”, also storms into the inbox of a customer that’s recently made a major purchase from that very same brand and excitedly registered for their mailing list. There’s no logic to this and it actually feels rude to me.

To use a dating analogy, it’s like asking someone out on a date and when they say “Sure, where are you thinking?” you ask them out again. Or to stretch that analogy to the extreme for current customers, it’s like living with a partner for a year and then walking into the kitchen and asking them out for the first time. Awkward.

Once you acknowledge that the database is full of real people that largely want to hear from, you can’t really avoid crafting bespoke messaging. Of course, database subscribers and current customers should be exposed to your latest campaigns, just don’t hit them over the head with it.  Tweak a version that acknowledges who they are and maybe chuck an exclusive bonus in – “We wanted you to hear first” or “Take an extra 5% off”. Even those that have recently bought can be included “It would be great if you want to buy another widget but while you’re enjoying your new one, refer a friend to our big widget promotion and earn yourself 50% off widget accessories!”

3. ROI over analytics

There’s a tendency for brands to get caught up in marketing analytics that really don’t matter. Database marketing channels are extremely transparent so there’s a wealth of this analytical data on offer. But let’s focus on what really matters here, let’s move past indicator metrics like clicks and opens and ask did we move the needle in terms of the bottom line? For this, we need to track metrics like return on investment, profitability and customer lifetime value.

I will cover these metrics and how to calculate them in an upcoming blog post but for now, consider that clicks without conversions are virtually meaningless and conversions minus the cost to generate them are the same. I once inherited a database marketing program that cost more to produce than it returned in revenue, let alone profit! It was producing revenue and opens and clicks were OK, happy days right? Not when you’re losing money executing in email which has a $44 return for every $1 spent!

A good habit to get into for smarter database marketing it to frame all discussions on the benefits of an upcoming database marketing project, or the results of a completed project, around universal business metrics.

Source: Smart Insights State of Email Marketing 2017

4. Consider all channels

When we think about database marketing, it’s easy to limit our focus to email marketing. Email is naturally the workhorse of any program because it’s cheap and delivers the best ROI But it is not the only tool in the arsenal and it certainly isn’t the best channel for every database marketing objective.

Database marketing has scope in any addressable medium, the trick is to deploy the right channel for the right challenge. For example:

• Social media retargeting is brilliant for creating conversion funnels that acquire and convert customers.
• SMS is still the most direct medium for many demographics, good for important alerts and reminders.
• Where a mobile app is in play, push notifications become another very direct option.
• Direct Mail is expensive but its rarity makes it ideal for premium customer welcomes or surprise and delight moments.
• Well-timed phone outreach can be the ideal welcome for a high-value customer or a complex product.

Smarter database marketing should revolve around a multi-channel contact strategy. The best channel is the one most relevant for that customer at that particular point in their development.

5. Tools don’t solve everything

Just about all brands want to improve their database marketing in some way. That’s great because most are nowhere near their ceiling but the problem is most think they need new technology to get better. That might sound like common sense because the new tech inherently brings with it new capability but you need to be in a position to utilise it.

In general, you should only upgrade your database marketing technology only when you outgrow your current set up. That means you have a program brimming with great content but your current platform prevents you from getting more relevant, more targeted. But most brands are lacking in the content department, they don’t have basic elements like newsletters or simple onboarding campaigns sussed, so the acquisition of an expensive new platform is a bit like selling your pushbike to put a Ferrari in the driveway then realising you don’t have a driver’s licence.

Software doesn’t generate great content for you. It doesn’t understand your customer base better or add extra hands to the marketing team. All of these I would strongly recommend you have in place before looking to upgrade.

6. Become a publisher

As touched on earlier, the scarcity of attention is a huge problem for marketers. For database marketers the challenge is to stand out in a cluttered email inbox or social newsfeed, and the only way to do that is to get noticed like a good publisher does, with reliably good content.

As a brands you need to set your sights on becoming the must-read, must-watch publisher that audiences look forward to receiving content from. Only then will they look for you in a cluttered inbox, only then will your logo jump out the them and convey “Don’t miss this”. Once you have that trust established you can infuse your sales messages in a clever and relevant way and they will land and resonate.

I will expand on this principle a lot throughout the rest of this blog, it really is the secret sauce to smarter database marketing becoming a publisher in later blog posts but some quick thought starters for now:

• Publish content that is genuinely in each channel, not a rehash.
• Do the work to wrap your sell around entertaining, educational and inspiring content.
• Signpost and categorise your content
• Set a reliable cadence – drop content at the same day and same time.
• Give your content a personaility, branding, look and feel etc.
• Create an opt-in stream for hardcore, direct sales messaging (if some want it, give it to them).

Below are some example email newsletters created with a publisher mindset:

7. Relevance is the only thing

If you only could worry about one thing in regard to your database marketing program I wouldn’t hesitate – it’s relevance. Relevance gets you noticed, it holds audiences, it opens sales channels and prevents spam and privacy complications.

Relevance is the make-or-break ingredient in smarter database marketing and the hunt for greater and greater relevance is the fire under all successful database marketers.

Every time you go out to a database you incur an opportunity cost. You’ve asked for more of your audience’s precious time and attention, putting your relationship under the microscope in the process. If they discover a piece of relevant content they enjoy, you’ve strengthened the relationship. If it’s irrelevant and you’ve wasted their time, you’ve pushed them closer to switching off for good.

That’s why we love lifecycle marketing, the relevance is baked into the model and you’ve only got to get the content right.

To wrap up

These are the principles we use to deliver smarter database marketing via our customer lifecycle marketing programs. If it seems like a mountain to climb well, to be perfectly frank, it is. But the good news is you don’t need to climb it all at once. Focusing on one facet alone and making even a small change will deliver an appreciable competitive advantage in what I believe is an inexplicably stagnate marketing discipline. So no excuses, just pick a principle and go!