CHICAGO -- The key to frequency marketing programs is organizing the business around the customers and letting them take part in making decisions.
"Use data to listen to your customers," said Rob Jackson, vice president of marketing and information services at Donnelley Marketing, Oakbrook Terrace, Ill. "Now we are seeing companies that let customers tell them how to make contact," he said, citing the example of a sweepstakes marketer that includes a space on the entry form where customers can fill in how they want to be contacted -- by phone, mail or fax.
"This is empowering the customer to have control over his relationship with the marketer. For example, say you have a program with two or three versions. Allow the customer to decide which version he should get. This could become an important tool," Jackson said.
Jackson was speaking at a conference here along with Paul Wang, assistant professor at Northwestern University, Chicago. The conference was hosted by the Strategic Research Institute, New York.
"Many companies have changed the way they set up their business, now setting it up around their customers. Instead of having product managers overseeing one to three products they have business managers over different segments of customers," Jackson said.
Companies are moving from "inside-out" thinking -- in which decisions are based on what the company has determined regarding what consumers want to buy, how they want to receive a communication, what message they want to hear and how they should respond -- toward an "outside-in" thinking. The new thinking is based on what the customer wants -- in products or services, communication methods and contents -- and consumer response, Jackson said.
The company's customer data base is used to track this type of information, he added.
Many organizations are investing heavily in technology to build a marketing data base, but, to their later distress, some have forgotten to budget for strategic analysis of the data or for research tactics that would allow easy access to the information, Jackson said.
Wang of Northwestern said a data base can help the company identify its best customers.
"Our customers may be profitable to us today, but will they still be three to five years from now? Are they also very price sensitive? We have to give them more incentives. It is possible to build a data base program from a tactical point of view," he said.
To integrate strategic data base development and loyalty marketing, Wang suggested bringing together two groups of people within the organization: the data base direct marketers, who can keep track of the heavy users and repeat users, and the corporate strategic planning staff, who consider the long term and what the industry will be like in three to five years.