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Customer Retention

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High ROI Customer Marketing: 3 Key Success Components

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Book Contents

 What is in the book?
 Productivity Blog
  Simple CRM
 Customer Retention
 Relationship Marketing
 Customer Loyalty
 Retail Optimization
  Visitor Conversion
  Visitor Quality
Guide to E-Metrics
  Customer Profiles
  Customer LifeCycles
  LifeTime Value
  Calculating ROI

  Recent Repeaters
  Retail Promotion
  Pre-CRM ROI Test
  Tracking CRM ROI
Tutorial: Latency
  Tutorial: Recency
  Scoring Software
  About Jim

Must Read Classic Articles (continued)

This is an archive; for latest see the Marketing Productivity Blog and Twitter: @jimnovo

These articles are keepers for customer retention oriented, Data-Driven marketers; they are selected primarily because they provide very short-in-supply case studies, metrics, or process models for relationship marketing, customer retention, or customer loyalty marketing on the Web.

Five Battle-Tested Rules of Online Retail
March 18, 2001   eCompany NOW
Stating the obvious is something many magazines do well.  But there's enough retail metrics in this article to make it an interesting read.  I still can't believe people waste so much time and money on collecting demographics; they're useless without understanding customer behavior first.

Winning Customers' Confidence
March 18, 2001   Call Center Magazine
Good, fairly unbiased review of CRM issues,  software functionality, and techniques, told from the call center perspective - the place where it matters most, I'd guess.  No amount of fancy analytics makes up for poor service.

Taking The Lead In The
Customer Satisfaction Game
March 18, 2001   Call Center Magazine
I hear a lot of talk about using surveys to determine customer satisfaction and loyalty.  Garbage.  Customer behavior is the only thing that conclusively demonstrates loyalty, as this article points out.  I'm not saying to dump surveys; just link them to actual behavior if you want to get the most out of them!

Put Your Click-Through Data To Work
March 15, 2001   Planet IT
Now you're talking.  First time I've seen it said anywhere but on this site.  The reason CRM has such a high failure rate is people don't know how to use the data it generates.  In many cases, you don't really need CRM software; what you need are people who know how to use the data, and can get by with basic data warehousing applications.  Do yourself a favor.  Get someone to show you what can be done Pre-CRM, learn the ropes, and you'll implement CRM right the first time.

Pan For Gold In The Clickstream
March 12, 2001   Information Week
Wow, they make this stuff sound hard, and it's mostly because they are relying on data mining as the analysis technique.  Data mining anything is hard, folks; it's like working on a Ph.D. without ever going to high school.  Use RFM to figure out if there's anything worth mining in there first; then feed these results into the mining process to give it a hand.  Want somebody to do this for you?  Ask me.

Web Kiosks Spur Spending In Stores
March 12, 2001   Information Week
First time I've seen this much hard data on kiosk use; some surprises in here for non-believers.  As usual, success really depends on what kind of a business you have.

Beyond the Shopping Cart
March 8, 2001  Intelligent Enterprise
Warning!  Hard core data miners only!  Tremendous example of what can be done if you know what you are doing.  As the author states, "Be quick in identifying your potential prospects because you have a very small window of opportunity to close a sale and hold on to a visitor."  Couldn't agree more, folks.  Interactive LifeCycles are extremely short!

Customer Loyalty Without the Points
March 2, 2001   DM News
Customer Retention, we call it.  Fact is, there is a tremendous amount you can do to keep customers with you and raise their value - and it's not nearly as hard as all the CRM companies keep telling you it is.

Fighting Internal Resistance to CRM
March 2, 2001   DM News
This article has some absolutely classic examples of the pitfalls inherent in "silo thinking."  Don't laugh too hard, this stuff happens all the time - and you're next!

Customer Relationships in the New Age
March 2, 2001   DM News
So you're going to pick on RFM, eh?  If you're not using any method to assess future customer value and likelihood to respond, RFM is a heck of a lot better than nothing.  But I agree, the way RFM has been used in the past, as a "snapshot" of behavior, is not optimal.  You have to look at behavior over time, which is exactly what the Drilling Down book is about, as you can see in these examples.

Take Another Look at Customer Loyalty
February 26, 2001   iMarketing News
There is a lot of confusion around the use of the phrase "customer loyalty," and as this article points out, behavioral evidence is the best measure.  He's right, and I tell you how to measure loyalty behavior yourself right here.

Data mining: Digging user info for gold
February 12, 2001  ZDNet
More data mining stuff.  This article takes a more "sensible" approach to the topic than many I've seen - it's not a cure-all, you have to understand what it is and isn't.  Great real-world example of an MSNBC mod that came directly from looking at customer behavior, and support for the idea of displaying behavior visually for decision-making.  Yea, I know, same technique my book describes.

Handling Missing Data Problems
January 29, 2001 DM News
A rarely discussed and somewhat gnarly subject, all budding database marketers need to know this stuff.  It's a huge problem when you rely on self-reported customer demographics and you have lots of "gaps" in your data.  If you were using behavior for profiling instead of demos, you wouldn't have any gaps; either the customer has activity or doesn't...

Use CRM to Build Exit Barriers
January 29, 2001 DM News
This is an advanced idea for most people, but the "next level" of customer retention programs does involve building barriers, and there is no better way to do it than through behavioral segmentation.  Changes in behavior are the LifeCycle "triggers" used to put up the barriers - the right product, the right offer, at the right time.

Finding Your Direct Marketing Retail Mantra
January 26, 2001   DM News
It's not just me saying this stuff, folks.  Listen to another person talking about how tracking customer behavior with RFM will transform your business.  Your demographic info means so much more when you understand the behavior associated with it.

Applying the Unified Theory of 
Database Marketing Online
January 24, 2001   DM News
Yet another proponent of using RFM profiling as the basis of customer retention efforts - tired and true, simple to understand and execute.  Also reviews other common applications of database marketing online.

Marketing Isnít Always Sell, Sell, Sell
January 11, 2001   DM News
Nice piece on topics you don't see much - "Kiss" programs with best customers and "Go Away" programs with worst customers.   These ideas may seem strange to newbies in database marketing land; they're fairly advanced programs, but extremely profitable.    Read the article to find out "What"; read my book to find out "How To."

Personalize the Online Experience
December 7, 2000   DM News
Folks, this is not another one of those lame personalization articles.  This person speaks truth.  Imagine, he says good customer retention starts with targeted acquisition, and customers who come from different media have different Lifetime Values.  Plus, he thinks you should do some customer analysis before you buy an analytical CRM solution.  Now where have I heard that before?

Leveraging Lifetime Customer Value
December 6, 2000   DM News
Now we're talking the talk.  Customer value by media source, targeted customer retention (not all customers, just the most profitable ones), identifying current low value customers with high future value - this one's got it all.  And nothing you don't know how to do if you read the book.

CRM Wonít Kill Database Marketing
December 5, 2000   DM News
This is a very simple idea with very powerful implications.  As I said here, what good is all this reactive CRM stuff if they don't come back to the site?  I usually get strange looks for my position.  This guy probably explains the position better than I have...

Proflowers.com Sows Seeds of Success
November 21, 2000   DM News
Great example of using RFM and demographics combined to produce very high ROI e-mail campaigns - as explained in the Drilling Down book!

Wading Beyond the Click Stream
November 17, 2000  DM News
Good overview of customer behavior modeling including this site's favorite approach - "tried and true" RFM.  Will sound familiar to frequent visitors.

Successful E-Marketing Gets Personal November 16, 2000   DM News
My opinion - 'Net marketers are spending too much time and effort on working with demographics, and ignore a much more powerful tool - simple customer behavior measurement tools like RFM.  I'm not the only one...

Go Beyond Targeting Best Customers November 14, 2000   DM News
Wow, an article about  subsidy costs, not a widely covered but very important topic for anyone concentrating their marketing efforts on "best customers."  Critical read for those new to database marketing or those who have been swept up in the "e-loyalty" movement.  Of course, measuring and avoiding subsidy costs is an entire chapter of the Drilling Down book!

That Elusive Customer Loyalty: How to
Build It,  Learn From It, and Profit From It

November 9, 2000   Financial Times and the Wharton School
Don't believe the industry pundits (me included)?  How about some serious academic analysis of the Drilling Down approach?

Finders Keepers
September 27, 2000   PC Magazine
Fairly extensive overview of customer retention, leaning hard on personalization technology, with some metrics for those looking for things like average cost per acquisition, average order size, and repeat purchase rate for comparison purposes.

Get Smarter
September 27, 2000   PC Magazine
Focuses on customer profiling and segmentation techniques used by SmarterKids.com.  Short article but good example of using testing and surveys to optimize a site for increased profitability.

Calculating Visitor Value to Publishers
September 18, 2000   DM News
Great article on deriving the value of a visit for pure publishing sites, leading to calculating ROI and Lifetime Value.

Where is the ROI in CRM?
September 15, 2000   DM Review
Goes through a classic customer value segmentation process in the financial industry to prove CRM is increasing LifeTime Value.

The Pros and Cons of Rules-Based Analysis:
Rules-Based Targeting Increases Sales
September 13, 2000   DM News
This pair of articles is self explanatory,
fellow Drillers.

The Pros and Cons of Rules-Based Analysis:
Rules donít paint the complete picture

September 13, 2000   DM News

Personalization Drives Retention
September 8, 2000   DM News
Good overview and some interesting measurement approaches.

Revenge of the Original Spammers
August 22, 2000   Business 2.0
Essentially makes the case for a direct marketing, customer retention and loyalty oriented approach to business on the Web.

Cubic Zirconia, Going Fast
August 7, 2000   The Industry Standard
Great article about what iQVC, one of the most profitable online retailers, does right.  Basically, they do what's in the Drilling Down book.  For those who don't know, I was VP of Marketing & Programming at Home Shopping Network, so I know a thing or three about the approach.


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