There is perhaps nothing more essential to the earned revenue of most arts organizations than a clean, current, and accurate customer list. The names, contact information, and transaction profile of anyone who has donated, visited, bought, or registered in some other way are the key to the large majority of your future revenue. Not a revelation, I hope.
But even assuming you have a clean, current, and accurate list (which most organizations do not), what do you do with it? There’s much to be learned from the world of direct marketing, and here’s at least one place to begin. Jim Novo describes three primary analysis models for exploring and exploiting your transaction list. According to him:
If you have long sales cycles, (durable goods like cars, appliances), sell very expensive products (enterprise software), or are a service business with ongoing billing which doesn’t vary much month to month (utilities, phone, ISP) then you will probably want to start with the Latency Model.
If you have tons of low value transactions with your customers – page views being a prime example – say in publishing / ad-supported / content oriented web sites, or are in retail with a low and narrow price range (books, CD’s), you should start out with the Recency Model.
If you are a general retailer with a wide spread of price points, either B2C [business to consumer] or B2B [business to business], then you want to go with the RFM Model.
Of course, each organization will likely benefit from a combination of these approaches, and some others from the direct marketing and customer management world. If you don’t even know if you have a clean list, go find out. Once you know, talk with your colleagues (and your friends in direct marketing) about what to do with it.
WE know this, but the only thing the folks supervising the marketing person want to know is “when do we see the brochure?” (and, of course, “How many hours before press time can I change programs?”).
I suggest every marketing director grab 100 random records from somewhere in the middle of their list, then call ’em. Most won’t be able to reach half, the rest being disconnected, moved, or reassigned to someone else. It will be a bracing dose of reality. The follow-up mail test will be even worse.
Most of us will be able to fund our wildest marketing dreams from the savings of not mailing/calling the dead or those who’ve invested in a Florida condo.
Andrew, this is a very helpful post. I hope that many marketers read it and consider the analysis tools available on the site.
So many marketers I know focus almost obsessively on acquiring more accounts as opposed to mining the database they have already built.
Thanks for the resource.