Choose speciality channel:   Choose sector channel:     Search the site

How to Guide


How to use CRM to deliver targeted messages

How to use CRM to deliver targeted messages

By Andy Wood, MD, GI Insight

Customer Relationship Management (CRM) is now a universally accepted concept amongst marketers.

According to our research it is now at a stage of market maturity where, in 2007, the proportion of the UK’s top 500 companies with a Head of CRM, comes in at approaching half (48%) up four percentage points since this survey was last conducted in 2005 (44%).

And the impression that one gets from ongoing reports on the technique is that few companies have failed to implement some form of CRM initiative.

Customers have come to expect that they will be dealt with in a meaningful and personalised fashion.  This expectation has meant that when companies do talk relevantly to their customers, using the information that they have collected on their profile, their preferences and most importantly their transactions, the rewards – in terms of customer retention and increasing value to the firm, are often stellar.

In the last two years, the financial services sector, in particular, has massively reduced the amount of direct mail it sends out, but has focused the budget thus freed up on making their communications more relevant and targeted in order to vastly improve response and retention rates.

Our recent research proved, for the first time, the correlation between relevant communications and customer satisfaction, itself an absolute prerequisite for any customer retention and development strategy.

To put things plainly, relevant communications cement customer satisfaction; and customer satisfaction encourages people to stay and spend more.

It is worth dwelling for a moment on the practicalities of implementing effective and relevant customer marketing.  To do so, one has to embrace the notion of a customer “journey”, moving incrementally from low-loyal, infrequent spenders, to high-loyal frequent spenders.

The customer journey is simple in principle and execution.  It is intrinsically linked to our view that more profit from customers can be driven from four actions:
-    More customers
-    Spending more
-    Spending more often
-    Less attrition
In a further strand, the CRM phenomenon is not just a private sector one.  The public sector has noticed the efficiency and effectiveness of ‘joined-up’ or – otherwise put – ‘single customer view’ communications and strategies.  In the public sector, the object in view is not to increase sales and profits, but rather to understand and satisfy the citizen through better, more co-ordinated delivery of public services.

The phenomenon in the public sector has retained the acronym ‘CRM’, but has renamed it Citizen Relationship Management.  The technique remains basically the same, but in the public sector tends to concentrates on the most needy in society – a wealth reversal compared to the types of people who are most keenly targeted in the commercial sphere.

In any case, the notion that targeted, data-based, relevant communications produce the best outcomes, is common to private and public sector alike.

GI Insight’s latest research examines the level to which the British customer or citizen feels that the most important organisations they deal with on a day-to-day basis are communicating with them.  Is it relevant?

Has the organisation gathered key information on them – their circumstances, tastes, preferences and, above all, transactions?  Has that information been collated and analysed so that communications, strategies, offers, service propositions, and so on, are relevant and targeted to the individual?

In short, is the information held on the recipient being intelligently used?  We know now that, across public and private sector organisations, the effective use of information for marketing and/or customer/citizen management can reap the most extraordinary dividends, both in terms of outcomes and efficiencies.

The results were converted into an index which showed the percentage points above or below average for communications/marketing relevance. You can see the findings in the table at the bottom of this article.

GI Insight research from early 2007 proved the correlation between relevant communications and customer satisfaction; and customer satisfaction is the absolute pre-requisite for improvements in customer retention and spending.

This current study, which has asked consumers about the relevance and targeting of communications they receive, shows a clear disparity between database marketing standards in different industries.

The mature techniques of British Supermarkets stands head and shoulders above the other sectors studied.  As an aggregated set of sectors, retailers in general are obviously getting the targeting game right more often than financial services, although the finance super-sector’s average is being dragged down by the poor performance of credit card issuers.

It can be no coincidence that these findings correlate strongly with the penetration of loyalty schemes in each of these sectors, suggesting that such schemes are critical to collecting sufficient data on the customers, especially in terms of associating transactions with customers.

The poorest at personalised and relevant communications are the public sector, both at the local and national government level (-18% and –19% respectively).  This finding shows that citizen relationship management, which has taken its inspiration from the groundwork of customer relationship management techniques in the private sector, still has a long way to go in effectively implementing data-based communications with the general public

Perhaps most importantly, this study reveals that an overemphasis is being placed on targeting efforts towards younger age groups, in contrast with the 45+ consumer.

This is in despite of the fact that the 45-65 age band is the highest earning, and that the departure of children from the family home often massively increases disposable income and, ironically, also creates demand for capital release financial products in parental support of those departed offspring as they set up home themselves. Banks are, surprisingly worst at taking advantage of targeting this wealthy group.

Two main conclusions summarise this report’s key findings.  First, it reveals which sectors need to improve their standard of customer relevance and targeting, and shows through the iconic gold-standard of the UK supermarket sector, what can be achieved.

Equally, it reveals the prejudice of marketers across all sectors in over-concentrating on the younger consumer to the neglect of high-potential, wealthier, and possibly more appreciative older customers.


viagra discounts coupons link viagra coupons printable
discount drug coupon coupons for prescriptions
how much do abortion pills cost abortion clinics in birmingham abortion hotline
cialis coupons from lilly free coupon for cialis
discount coupons for prescriptions coupon for prescription prescription drug discount cards
prescription card discount go cialis coupons from manufacturer
does an abortion hurt read why should abortion be illegal
coupon cialis open free prescription drug cards
cloradex costo cloradex bambini clorexidina
kamagra 100 kamagra jelly
prescriptions coupons online cialis coupons
microlite pill when to start microlite pill when to start

Check out 12ahead, our brand new platform covering the latest in cutting-edge digital marketing and creative technology from around the globe.

12ahead identifies emerging trends and helps you to understand how they can apply to modern-day companies.

We believe 12ahead can put you and your business 12 months ahead of the competition. Sign up for a free trial today.