By: Fred Milman (fred@anchorcomputer.com)

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How Information is Used to Drive Marketing Decisions in a Database Marketing Environment

The whole premise to having a marketing database is to be able to leverage the information and intelligence it contains to make better marketing decisions. The marketing database should house all pertinent marketing data so that you can get the answer to any question you might pose. Marketers should be able to query the database and to get the answer to …”If I know “X” then I could do “Y”.

The marketing database will allow marketers to:

  • Respond to events that are resident on the database with actions or triggers. Events might be scheduled, such as birthdays, anniversaries, etc. Or unscheduled events like purchases, complaints, returns, disconnects, cancels, web site visits, email opens/clicks, digital ad clicks, visits, retargets, shopping cart abandonment, etc. Each of these events can be used to generate some form of relevant communication or promotion to help achieve a marketing objective.
  • You can use the data on the marketing database to create market(ing) segments. Segments can be created using purchase behavior data, demographics, survey results or any combination of these. Using the information segments can be created using intuition, logic, common sense and with mathematical techniques such as factor & cluster analysis and CHAID. Segments are used to help create relevant communications through creative tone and manner that coincides with the characteristics of the segment as well as offers that are germane to each homogenous group.
  • The information/data on the marketing database is also used for predicting future customer or prospect behavior. Almost any behavior can be predicted: response to a promotion (direct mail, email) attrition/cancelation, purchase, payment, bad debt. If segmentation has developed, prediction models should probably be developed by segment since segment characteristics can have wide variation in content and make up. Prediction tools typically used and fed by the database are logistic regression, ordinary least squares regression, neural networks, genetic algorithms, CHAID and intuitive RFM models
  • The marketing database is also used to construct marketing tests and alternative strategies and then track and evaluate the results for future marketing tactics. Some examples of this are testing various contact strategies to see which yields the optimum results, offer testing to determine what drive the best response, loyalty programs to determine how to generate the greatest lifetime value. You can also evaluate different creative executions and segment strategies. This is a continuous process to always try and better the current status quo.

We at Anchor have a state of the art Database Management group that can help you develop a marketing database environment if you do not have one or evaluate and audit your current situation to provide you with information and a process on how you might improve what you have to increase success.

Fred Milman

Anchor Computer Head of Professional Services

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