When the going gets tough

12 Dec 08 - Mark Klein

We all know these are tough economic times. That message was reinforced for me again yesterday when I got a call out of the blue from a marketing analyst at a company not on my radar screen. She was charged by her VP with setting marketing priorities for next year. Specifically, she was asked to make marketing recommendations to help her company survive during this recession. The analyst was casting a broad net and found me.

After a short discussion, I found that her company’s revenues were excessively skewed more to new customer revenue compared to revenue from existing customers, so a sure answer to her question is to ramp up existing customer marketing. The justification for that effort is clear: you know who the customers are, you can figure out what they are likely to buy next, and making that sale is a lot less costly than acquiring a new customer. There is definitely gold in your transaction data.
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Who says the only good scores are over 90

19 Nov 08 - Mark Klein

As regular readers here know, we’re passionate about testing at Loyalty Builders. It’s the quickest way to improve your marketing campaigns. To spread the testing gospel, we recently posted a free online calculator to tell you how big a sample size is needed for your test, or to compute the power of a test with a given sample size. The calculator is designed for marketers, not statisticians, though several statisticians are using it. To make it more accessible to marketers, we also wrote an extensive tutorial, and that’s where the fun started.

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Target first time buyers to build your brand

03 Nov 08 - Arthur Einstein

Back around 1999, when new products were being introduced as fast as you could put up a website, brand building underwent a quiet revolution.

With markets moving at warp speed there simply wasn’t time to build trust and reputation the traditional way - by advertising.  In that super-heated environment the best way to build a brand was to get people to actually try the product.  If you could manage to get trial, if the dogs ate the dog food, if they came back to buy again, and if they told their friends, then maybe you had a shot at survival.

The markets haven’t cooled.  If anything they’ve heated up.  And I still believe that persuading a prospect to try your product or service can create more brand equity faster than all the 30-second Super Bowl spots you can afford.  Generating trial is still the best branding strategy I can think of.  
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Retention is the new acquisition

28 Sep 08 - Mark Klein

From here, it looks like the tide is turning.

When you fish the tidal estuaries of our New Hampshire coast, you quickly learn that fish bite when the tide is flowing. Many days I’ve sat in a boat at slack tide, waiting for the current to reverse, the tide to run, and the fish to bite. You watch for those first signs of the water moving, like a leaf or twig and then seaweed beginning to move past your boat. Right now, I am seeing indications that the tide in marketing is changing.

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Top Ten Reasons Why Companies Don't Adopt Mathematical Marketing

11 Sep 08 - Mark Klein

10. Ignorance: They’ve never heard of it.

9. Irrelevance:  Most of their customers are one-time buyers, so how could mathematical marketing help?
 
8. Overconfidence: They think their current marketing program is working fine. They already know who their best customers are. They’re getting 80% of their revenue from 20% of their customers. What could be better?

7. Skepticism: They doubt it works; they believe all customers defect sooner or later.

6. Resistance to change: Regardless of whether it improves the bottom line in the long-run, they are unwilling to change doing business as usual.
 
5. Inexperience: Mathematical Marketing appears complex, requiring skills and people they don’t have.
 
4. Cost: It sounds expensive

3. Intimidation: Marketing is an art, and math belongs in the classroom.

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