Data Therapy: Walksorting the dead - The Client's View
THE CLIENT'S VIEW
Suzanne Richardson, Head of campaign services, Nectar
Andrew Bridges, Data quality and supply manager, Nectar
Data accuracy is fundamental to everything we do here at Nectar. The ability to understand consumer behaviour and direct highly-targeted communications to customers has become an important mainstay of B2C marketing over the past ten years. It is difficult to imagine trying to manage a nationwide loyalty scheme like Nectar without effective data suppression.
Long gone is the age of generic, household-level offers as referred to in Richard Anderson's comment about 'dumb DM'. In order to achieve the highest response rates and ROI possible, campaigns need to be personalised and driven by accurate, up-to-date data. There are over six million different coupon offer combinations accompanying Nectar's quarterly point statements, for example. The programme's sponsors and partners want to ensure at all times that their offers are reaching the most receptive customers and prospects possible. So to achieve this, we apply a suite of marketing models that determine, based on recent Nectar Card activity, which offers are likely to be the best 'fit' for a particular cardholder. As you can gather, the words 'Dear Householder' just aren't in our vocabulary.
An unsuppressed campaign would be inconceivable today from a brand management perspective. Delivering a commercially-viable response rate as cost-effectively as possible is always paramount. We're in the loyalty business, and trust has to underpin the millions of mutually beneficial relationships between programme partners and consumers. Trust that we're keeping personal information up-to-date, secure and accurate; trust that we're awarding points correctly; and trust that offers will be relevant.
As for over-suppression, it enters the equation only when marketers clean data on an occasional or ad-hoc basis. This ill-advised practice may be a carry-over from the early days when suppression was seen as an IT function by some marketers. The 'Leave it to the IT guys to sort out' approach is a thing of the past. Today, we must rely on keeping all of our datasets as up-to-date as possible. We regularly use commercially available suppression files to ensure that cardholders' Nectar experience is as seamless as possible.
The accuracy of all suppression data we apply is likewise incredibly important. Verified data trumps assumed data every time for us. This means that the 'Return to Sender' scenario which David alluded to in his article isn't the sole indicator we'd rely upon when determining whether a customer had moved. Our matching and testing routines are such that we cross-reference files against various data sources to determine its status. If in doubt, we match and test again. 'Assume nothing', is our default mode when it comes to suppression. We only wish the estimated 30 per cent or so of UK direct mailers that aren't using suppression would do so and help eliminate the term 'junk mail'.
So in our opinion, giving response rates preference over suppression/data management best practice simply isn't viable. It can damage brand image, annoy customers and won't comply with the requirements of regulators such as the ICO and ASA. If client retention and profit maximizationb are the goals, then it makes sense to suppress.
THE SOLUTION
Turn down the volume, turn up the value. That has been the primary strategy of companies who continue to use direct mail. Keen to leverage the strengths of a tangible contact, they have focused on ways to keep costs down while still achieving response and conversion objectives.
In doing so, many organisations continue to maintain the divide between targeting and suppression. Willingness to spend on good quality data for positive selection, combined with predictive modeling, has typified those brands still in market with their mailings.
Conversely, suppression data is seen as a separate line of cost and even an unnecessary.
The retrenchment to customer retention marketing is partly to blame for this.
Organisations assume that they have better knowledge of their customers that any third party. That assumption is false, since many customers barely recognize that they have a relationship with the company, let alone think to tell them if they have moved.
Shifting towards hot leads as the basis for positive targeting is only serving to reinforce this distinction on the prospecting side of things. Marketers assume that an individual who indicates that they are in market for a product or service can be found at the address they have just provided. Lead generation data providers do nothing to contradict this view.
Yet it is surely self-evident that many of the products and services which bring consumers to market relater to house moves. How many respondents who indicate they are in market for consumer durables or financial products will give the address they are moving to, rather than the one they are moving from?
Even if the buyer of a hot lead acts quickly, they could find a promising contact cuts out halfway thorough the sales cycle. So suppression needs to be applied even to the most apparently recent of data sets in order to maintain its responsiveness and ROI.
With budgets more constrained than ever and marketing performance under close scrutiny, any wasted effort has become unacceptable. So way continue to overlook the one clear process that could strip out wastage and optimize results? It is time for data managers to unify the living and the dead.
This artcile originally featured in the August 2009 edition of Data Strategy