Businesses want partners and technologies that make their lives easier and more effective, from improving productivity to penetrating new markets. They are exploring ways to broaden existing customer relationships to enhance customer loyalty and milk every dollar out of the relationship to do more than just survive in today’s economy.
Variable direct mail is one of the tools in the marketing basket that companies are using to establish a one-to-one relationship with their customers. Digital print is the obvious driver, but not without some misunderstanding and confusion on its value and use. “Digital is about creating value, not adding value; it’s not about adding services, it’s about integrating services.”1
Integrated marketing moves one-to-one communications to a higher level. Results are trackable; you can test campaigns before fully investing in major campaigns; and it is more interactive. No doubt about it, digital has whet the appetite of the customer. They want customization. They want versioning. They want personalization. They want you to coordinate the print with electronic media to provide an integrated customer experience. And, they want it now.
Understanding how to use it, when to use it and understanding the value derived from digital integration is the first step. Customer Lifetime Value, for example, which measures the potential profits realized from a customer over a lifetime, can help you direct personalized marketing campaigns in the third year, which traditionally shows an increase in spending. You can also extract ROI (return on investment) over a lifetime for the same customer or a group of customers.
We must also factor into the equation the reality that customer needs are dynamic – they change over time. We need to maintain contact with them and regularly solicit input. To retain them, we must follow-up on their feedback to strengthen their loyalty and, ultimately, the relationship.
Few businesses really understand the total value of a single customer. When you take the profit from sales, factor in the profits from follow-on sales over the life time of the customer, plus additional profits from referrals and word of mouth, overall ROI can reach more than 1,000 percent.
When you consider the impact that a customer can have on a business – positive or negative – it would behoove you to look at all customer relationships in these tough economic times.
At LithExcel, we work with our customers to integrate all levels of customer management into their variable direct mail or cross media marketing programs. We apply formulas to help them calculate Customer Lifetime Value and project ROI for individual projects, as well as major campaigns.
“Social media is like word of mouth on steroids.” The growth rate on Twitter from February to March, 2009 was 1,382 percent; there’s an average of three million per day and more than five trillion minutes are spent on Facebook each day.2
Increasing customer retention by five percent can boost profits by 85 percent. A satisfied customer tells an average of three people about a product or service he or she likes and 11 people about one they do not like. Add human behavior to the viral characteristics of the internet and within seconds a dissatisfied customer can reach thousands within seconds. 3
1 Source unknown
2 Marta Kagan, Social Media Has Grown Up: One Year On
3 Chartered Institute of Marketing, September 2009
Waleed Ashoo
CEO/President
LithExcel Communication Services Provider
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