1. Chapter 20 One-to-One Marketing

2. What is One-to-One Marketing? Individualized Information-Intensive Customer-Based Long-Term Oriented Share of Customer With a Focus on... DatabaseTechnologyDatabaseTechnology One-to-One Marketing is... One-to-One Through Use of... Through

3. One-to-One Marketing Focuses on Share of Customer Develops Customers Finds Products for Customers Mass Marketing Focuses on Share of Market Develops Products Finds Customers for Products

4. Mass Production “One-to-One” Benefit of Technology “One-to-One” Before Industrial Revolution The Evolution of One-to-One Marketing

5. Forces influencing One-to-One Marketing Demand for Accountability Emergence of New Media Alternatives Emergence of New Media Alternatives Decreasing Brand Loyalty More Demanding, Time-Poor Consumers More Demanding, Time-Poor Consumers Increasing Diversity

6. Marketing Impact of Trends Consumer recognition as unique individuals Consumer recognition as unique individuals Marketing Impact of Trends Marketing Impact of Trends More direct and personal marketing efforts More direct and personal marketing efforts Rewards for loyalty Increased importance of One-to-One Marketing Increased importance of One-to-One Marketing

7. The One-to-One Marketing Communications Process SenderEncoderOne-to-One Message Channel DecodingReceiver Receiver Response Capture of response shapes futures message

8. Communications Process Differences Message isPersonalized Channel isDirect Noise Noise is not present Response Individual Response is captured

9. One-to-One Marketing Applications  Identify the best customers  Retain loyal customers  Cross-sell other products or services  Design targeted marketing communications  Reinforce consumer purchase decisions  Induce product trial by new customers  Increase the effectiveness of distribution channel marketing  Improve customer service

10. Retaining Loyal Customers Retaining an additional 5% of customers each year increases profits by 25% Improving customer retention by 2% can decrease costs by 10%

11. Other Marketing Applications through Databases Match profiles to cross-sell other products to customers Modify marketing messages based on customer profiles Reach out to customers to reinforce the purchase decision

12. Find new customers Gain insight into who is purchasing products Improve customer service Other Marketing Applications through Databases

13. Data-Driven Marketing The process of gathering, maintaining, and analyzing information about customers and prospects to implement more efficient and effective marketing communications.

14. Marketing Database The compilation of names, addresses, and other pieces of pertinent information about individual customers and prospects that affects what and how marketers sell to them.

15. Data Warehouse A large corporate-wide database in which the data are culled from a number of legacy systems that are already in place within the organization.

16. Building a Marketing Database Enhance customer data Analyze information to find answers Collect the right data Collect the right data

17. Collect the right data Response Lists Compiled Lists Building a Marketing Database

18. Enhance customer data Compiled Data Compiled Data Modeled Data Modeled Data Custom Data Custom Data

19. Enhance Customer Data Modeled Data Modeled Data Custom Data Custom Data Information has been sorted into distinct groups or clusters of consumers or businesses based on census, household, or business-level data. Information has been sorted into distinct groups or clusters of consumers or businesses based on census, household, or business-level data. Enhancement information acquired by the marketer, including customer surveys, customer participation programs, product registration, warranty cards, or loyalty marketing programs.

20. Lifetime Value Analysis Lifetime Value Analysis Predictive Modeling Predictive Modeling Data Mining Customer Segmentation Customer Segmentation RFM Analyze information to find answers Building a Marketing Database

21. Customer Segmentation SegmentationBases Demographics Geographics Purchase Behavior Psychographics

22. Recency-Frequency-Monetary Analysis A data manipulation technique that determines the firm’s best customers by identifying those customers who have purchased most recently, most frequently, and who have spent the most money.

23. Lifetime Value Analysis A data manipulation technique that projects the future value of the customer over a period of years using the assumption that marketing to repeat customers is more profitable than to first-time buyers.

24. Uses of Customer Lifetime Value Provides a basis for targeting new customers Provides a basis for targeting new customers Provides level of spending to retain a customer Provides level of spending to retain a customer Show expense to acquire a new customer Show expense to acquire a new customer

25. Data Mining Create customer profiles Uses of Data Mining Uses of Data Mining Determine the reason for customer loyalty Determine the reason for customer loyalty Analyze the potential return for strategies Help forecast sales

26. Establish Enduring Customer Relationships Create a Multimedia Marketing Initiative Deliver Personalized Messages.com One-to-One Marketing and the Internet

27. Privacy Concerns with One-to-One Marketing Invasion of Privacy Privacy Popularity of Internet for data collection Popularity of Internet for data collection Unawareness of information collected Unawareness Misunderstanding about privacy laws and regulations Misunderstanding about privacy laws and regulations