by Tom Ratkovich
The smarter you are about your customers and prospects, the more relevant you can be and the more profitable you'll become.
Relevance.
It is a simple word with immense implications for marketers.
Relevance is the basis of meaningful communication. While relevant messages are heard, irrelevant ones are discarded.
Relevance influences the productivity of your telemarketers and the response to your direct mail. It is a critical factor in reader retention. And your ability to deliver a relevant audience determines the willingness of advertisers to send money your way.
Getting Relevant
So, how is it that you become more relevant? How does relevance translate into meaningful applications?
Information facilitates relevance. The more you know about your customers and prospects, the better you can communicate the relevance of your products. And the more capable you are of delivering meaningful messages to the customers and prospects of your advertisers.
But that information must be actionable. That is, it must facilitate programs and processes that increase revenues and/or decrease costs.
Household-Specific Data
The most powerful, accurate, actionable information available is the transactional data you maintain about your customers. Why? Because it represents actual behavior. And given the right tools for analyzing that data, you can develop some pretty sophisticated marketing applications to support acquistion, retention, reactivation and advertiser programs.
But that data becomes infinitely more powerful and actionable when it is integrated with household-specific demographic and lifestyle information available from a variety of data providers.
Circulation Applications
The integration of your transactional data with information related to age, income, home ownership, marital status, presence of children, credit card usage and interest in various lifestyle activities facilitates abundant relevance marketing opportunities. These include:
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Targeted acquisiton. The ability to customize your message to a specific demographic or lifestyle segment enables you to sell the relevance of your newspaper. And an acquisition based on relevance is far more enduring than one based simply on a discount. |
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Data-driven upgrade campaigns. It is much easier to move a subscriber from weekend-only to seven-day if you can provide them a compelling, relevant reason for doing so. Like, "the Family section designed specifically for parents is published only on Tuesdays." Or, "the High Tech tab is available each Wednesday and is written just for savvy computer users like you, and it will only cost you an extra dollar each week." |
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Tailored renewal marketing programs. Retention marketing initiatives can be implemented that reinforce the value of the newspaper to the reader. These can be customized according to individual household characteristics. |
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Meaningful analysis to identify potential problems and opportunties. Through profiling, segmentation and analysis you can identify and score individual households based on potential value, credit risk, churn risk, etc. This allows marketers to target or intervene appropriately. |
Advertising Applications
Your advertisers pay you to deliver customers by putting relevant messages in the hands of quality prospects. They will pay you more to deliver more customers.
You can do that with the right information. You need to go beyond standard demographics to determine how people spend their time and money - not just how much they have.
The ability to identify and locate those people that travel, own a computer, play golf, travel abroad, etc. will have powerful revenue implications. For instance, you can deliver:
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Targeted non-subscriber distribution of special sections or niche publications. Most newspapers regularly distribute lifestyle-oriented special sections. Frequently targeted segments include golfers, skiers, investors, gardeners, fitness buffs, computer users, fashion clothing buyers, etc. The cost of print overruns and bulk postage is negligible compared to the revenue potential of targeted distribution to non-subs. |
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Integrated ROP/direct mail programs. Only you can combine the reach of the newspaper with the precision of direct mail. Once you have acquired the right data, you can become an indispensable partner to key advertisers by: |
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Assisting the advertiser in defining its target market; |
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Quantifying the newspaper's penetration into that target; and |
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Expanding your reach of high potential customers through supplemental direct mail to targeted non-subcriber households |
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What's the ROI?
The cost of acquiring household data will vary based on the volume and scope of the information. It will typically range anywhere from $35 per thousand records for basic demographics to upwards of $100 per thousand for comprehensive demographic and lifestyle packages.
Whencompared to the potential enhancements to productivity and revenue, the investment is really quite small. The return on that investment is clearly more immediately measurable on the advertising side of the business. But the improvements in your circulation acquisition and retention efforts resulting from increased relevance will also pay big dividends in the longer term.
Reproduced here from IDEAS Magazine, the publication of the International Newspaper Marketing Association (INMA), May/June 2001. Tom Ratkovich is the president and founder of ASTECH InterMedia. He can be reached at 303.296.9966 x111.
