13 09-15 cat class session 3 & 4
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The document presents a comprehensive analysis of customer data management strategies, including data hygiene, segmentation, and RFM (recency, frequency, monetary value) analysis, aimed at enhancing marketing effectiveness and profitability. It highlights the importance of cleaning mailing lists to improve response rates and decrease mailing costs, ultimately leading to increased profit margins. A significant emphasis is placed on understanding customer behavior through various metrics and employing advanced modeling techniques for targeted marketing efforts.
13 09-15 cat class session 3 & 4
- 1. The Catalogue Masterclass … the Second Half
- 2. Customer File Analysis • Essential Analysis • Data Hygiene • RFM • Statistical Analysis • Importance of Seasonality and Products • Segmentation and Mailing Selection • Mailing Plan and Forecasts • Segmentation / Mailing Pack Allocation • The Value of Data Cooperatives • Lifestyle Profiling • Data Appending • Prospect / Single Buyer / Inactive Modelling
- 3. Data Hygiene... …. Improve ROI, Increase Profit • Address Correction • Salutation Optimisation • Internal Duplication • Individuals – Households • Lower Mailing Costs • Higher Response Rates AND… • Delight Customers
- 4. Address Cleaning and Salutations Over 40% No Titles ! BUT… 97% of Titles Discoverable !
- 5. Deduplication and Matching … PLUS … … Goneaways and Deceased So… 124,400 Records In MINUS 14, 700 DUDS ( That’s 12% of the Mailing File)
- 6. How This All Translates In To Profit Mailing Qty Mailing Cost Orders Response Net Margin / Order Dirty File 124,400 £74,600* 12,000 9.7% Clean File 109,700 £65,800 + £2,500 extra for cleaning 12,000 11.4% + £0.44 Clean File Total £69,300 TOTAL SAVING £5,300 = 7.1% Response Up By 18%Response Mailing Down by 12% Mailed Quantity Down by 12% Profit Up By £5K*Mailing Cost @ £600 /’000
- 7. RFM – Recency, Frequency, Monetary Value - And the most important = Recency and Frequency - Make no mistake, Monetary Value is a great discriminator for refining selections – particularly for marginal mailing groups - Monetary Value aids VIP and Loyalty Programmes too
- 8. RFM – Recency, Frequency, Monetary Value - And the most important = Recency and Frequency - Make no mistake, Monetary Value is a great discriminator for refining selections – particularly for marginal mailing groups - Monetary Value aids VIP and Loyalty Programmes too Then Start to Add Other Variables to Models – But WHICH? - Intuitive Analysis - Product Group - Seasonality - Single Buyer Catalogue v Insert v Web - Value of Last / First Order - Email v Non-Email Subscribers - CHAID – Easily Understood By Non- Statisticians - Propensity Scoring / Modelling and Logistic Regression – Leave it to Experts
- 9. The RFM Analysis Summary … …Where We Want to End Up MAILING March 2013 - My Catalogue CONVERSION MATRIX Last Total Number of Orders >>>>> Ordered Total >5 5 4 3 2 1 Q1,2013 11.9% 20.3% 13.7% 7.1% 7.8% 8.5% 2.4% Q4,2012 12.3% 22.5% 10.8% 10.4% 6.9% 5.0% 4.9% Q3,2012 9.6% 14.6% 6.7% 9.7% 5.7% 6.7% 3.0% Q2,2012 11.8% 16.2% 12.4% 9.5% 10.5% 8.5% 7.3% Q1,2012 11.8% 13.7% 10.6% 10.9% 9.3% 12.2% 5.9% Q4,2011 4.3% 5.2% 8.4% 9.8% 10.3% 2.2% 1.7% Q3,2011 1.7% 6.7% 6.0% 6.2% 3.8% 2.6% 1.0% Q2,2011 1.7% 7.3% 13.9% 3.0% 5.0% 1.7% 1.4% Q1,2011 3.1% 14.9% 2.0% 2.1% 2.2% 4.2% 2.3% Q4,2010 2.5% 3.6% ??? 2.0% 3.8% 2.2% 1.6% Q3,2010 1.8% 5.2% 2.5% 1.2% 2.0% 3.4% 1.4% Q2,2010 3.0% 2.9% 4.2% 3.3% 6.1% 3.8% 2.7% Q1,2010 4.1% 7.8% 18.5% 6.0% 3.5% 2.6% 1.6% Q4,2009 1.3% 2.8% 18.5% ??? 1.2% 1.3% 0.7% Q3, 2009 1.5% 11.9% ??? ??? 2.2% 2.1% 0.9% Q2, 2009 1.2% 6.6% 3.2% 1.0% 2.1% 2.2% 1.1% Mail ??? Do NOT Mail
- 10. Standard Recency / Frequency Audit MAILING March 2013 - My Catalogue Order Frequency Mailing Volume % Conv Orders Demand Ave Order Value Sale per Cat Net Margin / Order Previous Buyers Q4,2011 5+ 2,558 20.3% 519 £20,677 £39.88 £8.08 £16.98 Q3,2011 5+ 3,691 22.5% 830 £34,149 £41.17 £9.25 £17.91 Q2,2011 5+ 9,745 14.6% 1,423 £65,207 £45.83 £6.69 £18.80 Q1,2011 5+ 18,918 16.2% 3,063 £136,270 £44.49 £7.20 £18.54 Q4,2010 5+ 2,376 13.7% 325 £12,915 £39.76 £5.44 £15.49 Q3,2010 5+ 1,905 5.2% 99 £5,011 £50.52 £2.63 £13.74 Q2,2010 5+ 1,365 6.7% 92 £3,717 £40.40 £2.72 £11.30 Q1,2010 5+ 2,500 7.3% 182 £7,140 £39.23 £2.86 £11.37 Q4,2009 5+ 210 14.9% 31 £1,144 £36.65 £5.46 £14.30 Q3, 2009 5+ 751 3.6% 27 £811 £29.81 £1.08 -£1.67 Q2, 2009 5+ 232 5.2% 12 £298 £24.84 £1.28 £0.82 Q1, 2009 5+ 4,912 2.9% 140 £4,711 £33.65 £0.96 -£4.23 Q4, 2008 5+ 216 7.8% 17 £548 £32.62 £2.54 £8.59 Q3, 2008 5+ 292 2.8% 8 £508 £62.69 £1.74 £9.74 Q2, 2008 5+ 20 11.9% 2 £49 £20.43 £2.43 £5.17 Q1, 2008 5+ 231 6.6% 15 £548 £35.80 £2.37 £8.83 FREQUENCY TOTAL 49,920 13.6% 6,785 £293,703 £43.29 £5.88 £17.23 Q4,2011 5 551 13.7% 76 £2,238 £29.61 £4.06 £10.43 Q3,2011 5 1,720 10.8% 186 £8,853 £47.60 £5.15 £18.25 Q2,2011 5 1,872 6.7% 126 £5,128 £40.70 £2.74 £11.44 Q1,2011 5 3,826 12.4% 476 £21,647 £45.48 £5.66 £17.92 Q4,2010 5 635 10.6% 67 £3,103 £46.18 £4.89 £17.42 Q3,2010 5 275 8.4% 23 £751 £32.66 £2.73 £9.16 Q2,2010 5 364 6.0% 22 £799 £36.33 £2.20 £8.24 Q1,2010 5 270 13.9% 38 £1,105 £29.30 £4.09 £10.35 Q4,2009 5 335 2.0% 7 £209 £30.74 £0.62 -£14.21 Q3, 2009 5 72 0.0% - £0 Q2, 2009 5 320 2.5% 8 £404 £50.52 £1.26 £1.26 Q1, 2009 5 353 4.2% 15 £1,204 £81.91 £3.41 £26.56 Q4, 2008 5 87 18.5% 16 £666 £41.09 £7.61 £17.31 Q3, 2008 5 13 18.5% 2 £51 £21.18 £3.92 £7.35 Q2, 2008 5 14 0.0% - £0 Q1, 2008 5 66 3.2% 2 £25 £11.85 £0.38 -£12.98 FREQUENCY TOTAL 10,775 9.9% 1,064 £46,183 £43.42 £4.29 £15.63 Q4,2011 4 1,317 7.1% 93 £2,988 £32.12 £2.27 £7.57 Q3,2011 4 1,962 10.4% 204 £7,987 £39.15 £4.07 £13.81 Q2,2011 4 2,368 9.7% 230 £10,136 £44.14 £4.28 £15.89 Q1,2011 4 7,526 9.5% 717 £31,082 £43.36 £4.13 £15.38 Q4,2010 4 571 10.9% 62 £2,621 £42.21 £4.59 £15.58 Q3,2010 4 328 9.8% 32 £783 £24.46 £2.39 £6.08 Q2,2010 4 252 6.2% 16 £695 £44.54 £2.76 £12.59 Q1,2010 4 2,936 3.0% 88 £3,098 £35.05 £1.06 -£2.40 Q4,2009 4 192 2.1% 4 £100 £24.95 £0.52 -£16.33 Q3, 2009 4 800 2.0% 16 £359 £22.46 £0.45 -£18.77 Q2, 2009 4 181 1.2% 2 £37 £17.61 £0.20 -£42.86 Q1, 2009 4 897 3.3% 30 £993 £33.44 £1.11 -£1.40 Q4, 2008 4 20 6.0% 1 £68 £56.90 £3.39 £18.37 Q3, 2008 4 29 0.0% - £0 Q2, 2008 4 49 0.0% - £0 Q1, 2008 4 317 1.0% 3 £138 £44.65 £0.44 -£39.06 FREQUENCY TOTAL 19,744 7.6% 1,498 £61,085 £40.79 £3.09 £12.48 Q4,2011 3 1,503 7.8% 117 £4,279 £36.57 £2.85 £10.58 Q3,2011 3 1,976 6.9% 137 £4,379 £31.92 £2.22 £7.32 Q2,2011 3 5,151 5.7% 291 £11,845 £40.68 £2.30 £9.72 Q1,2011 3 5,988 10.5% 628 £24,837 £39.56 £4.15 £14.06 Q4,2010 3 516 9.3% 48 £1,798 £37.46 £3.48 £12.28 Q3,2010 3 228 10.3% 23 £623 £26.62 £2.73 £7.46 Q2,2010 3 3,283 3.8% 126 £7,295 £57.99 £2.22 £13.34 Q1,2010 3 2,380 5.0% 120 £4,809 £40.07 £2.02 £8.14 Q4,2009 3 1,424 2.2% 32 £953 £29.79 £0.67 -£11.80 Q3, 2009 3 335 3.8% 13 £369 £29.26 £1.10 -£1.33 Q2, 2009 3 671 2.0% 14 £843 £62.43 £1.26 £1.41 Q1, 2009 3 452 6.1% 28 £874 £31.66 £1.93 £6.00 Q4, 2008 3 147 3.5% 5 £216 £42.32 £1.46 £3.82 Q3, 2008 3 181 1.2% 2 £82 £39.22 £0.46 -£32.05 Q2, 2008 3 288 2.2% 6 £164 £26.38 £0.57 -£14.71 Q1, 2008 3 567 2.1% 12 £231 £19.21 £0.41 -£18.74 March 2013 Sample Catalogue Total Order Frequency Mailing Volume % Conv Previous Buyers Q4,2011 5+ 2,558 20.3% Q3,2011 5+ 3,691 22.5% Q2,2011 5+ 9,745 14.6% Q1,2011 5+ 18,918 16.2% Q4,2010 5+ 2,376 13.7% Q3,2010 5+ 1,905 5.2% Q2,2010 5+ 1,365 6.7% Q1,2010 5+ 2,500 7.3% Q4,2009 5+ 210 14.9% Q3, 2009 5+ 751 3.6% March 2013 Sample Catalogue Total Recency – Analysed by Quarter or Month Frequency – Analysed by 1,2,3,4,5,5+ purchases over lifetime OR specified period (eg 0-12, 0-24, 0-36 months)
- 11. MAILING March 2013 - My Catalogue Order Frequency Mailing Volume % Conv Orders Demand Ave Order Value Sale per Cat Net Margin / Order Previous Buyers Q4,2011 5+ 2,558 20.3% 519 £20,677 £39.88 £8.08 £16.98 Q3,2011 5+ 3,691 22.5% 830 £34,149 £41.17 £9.25 £17.91 Q2,2011 5+ 9,745 14.6% 1,423 £65,207 £45.83 £6.69 £18.80 Q1,2011 5+ 18,918 16.2% 3,063 £136,270 £44.49 £7.20 £18.54 Q4,2010 5+ 2,376 13.7% 325 £12,915 £39.76 £5.44 £15.49 Q3,2010 5+ 1,905 5.2% 99 £5,011 £50.52 £2.63 £13.74 Q2,2010 5+ 1,365 6.7% 92 £3,717 £40.40 £2.72 £11.30 Q1,2010 5+ 2,500 7.3% 182 £7,140 £39.23 £2.86 £11.37 Q4,2009 5+ 210 14.9% 31 £1,144 £36.65 £5.46 £14.30 Q3, 2009 5+ 751 3.6% 27 £811 £29.81 £1.08 -£1.67 Q2, 2009 5+ 232 5.2% 12 £298 £24.84 £1.28 £0.82 Q1, 2009 5+ 4,912 2.9% 140 £4,711 £33.65 £0.96 -£4.23 Q4, 2008 5+ 216 7.8% 17 £548 £32.62 £2.54 £8.59 Q3, 2008 5+ 292 2.8% 8 £508 £62.69 £1.74 £9.74 Q2, 2008 5+ 20 11.9% 2 £49 £20.43 £2.43 £5.17 Q1, 2008 5+ 231 6.6% 15 £548 £35.80 £2.37 £8.83 FREQUENCY TOTAL 49,920 13.6% 6,785 £293,703 £43.29 £5.88 £17.23 Q4,2011 5 551 13.7% 76 £2,238 £29.61 £4.06 £10.43 Q3,2011 5 1,720 10.8% 186 £8,853 £47.60 £5.15 £18.25 Q2,2011 5 1,872 6.7% 126 £5,128 £40.70 £2.74 £11.44 Q1,2011 5 3,826 12.4% 476 £21,647 £45.48 £5.66 £17.92 Q4,2010 5 635 10.6% 67 £3,103 £46.18 £4.89 £17.42 Q3,2010 5 275 8.4% 23 £751 £32.66 £2.73 £9.16 Q2,2010 5 364 6.0% 22 £799 £36.33 £2.20 £8.24 Q1,2010 5 270 13.9% 38 £1,105 £29.30 £4.09 £10.35 Q4,2009 5 335 2.0% 7 £209 £30.74 £0.62 -£14.21 Q3, 2009 5 72 0.0% - £0 March 2013 Sample Catalogue Total
- 12. TRACK - Month on Month RFM Movements MARKETING DASHBOARD - DUMMY FIGURES MONTH/SEGMENT TOTAL START OF MONTH TOTAL END OF MONTH % % TOTAL DEMAND TOTAL START OF MONTH TOTAL END OF MONTH % % TOTAL DEMAND January Multi Active 0-2 77,186 104,123 135% 56% 74,617 63,709 85% 51% Multi Lapsed 3-4 56,186 42,332 75% 40% 49,827 59,710 120% 35% Multi Inactive 5-6 25,291 25,722 102% 32% 23,779 23,925 101% 27% Single Active 0-2 59,511 57,725 97% 56% 62,897 62,376 99% 54% Single Lapsed 3-4 56,663 53,970 95% 56% 50,630 48,758 96% 42% Single Inactive 5-6 31,003 35,168 113% 56% 10,856 14,163 130% 45% Dormant >6 163,785 168,336 103% 30% 203,998 206,692 101% 28% New buyers 62% 58% TOTAL 469,625 487,376 104% 55% 476,603 479,334 101% 50% February Multi Active 0-2 104,123 77,621 75% 45% 63,709 70,123 110% 67% Multi Lapsed 3-4 42,332 58,786 139% 50% 59,710 55,516 93% 36% Multi Inactive 5-6 25,722 26,006 101% 43% 23,925 23,738 99% 31% Single Active 0-2 57,725 56,734 98% 60% 62,376 60,569 97% 58% Single Lapsed 3-4 53,970 52,617 97% 63% 48,758 50,559 104% 54% Single Inactive 5-6 35,168 29,304 83% 61% 14,163 15,234 108% 49% Dormant >6 168,336 229,779 137% 39% 206,692 227,098 110% 25% New buyers 63% 58% TOTAL 487,376 530,847 109% 52% 479,334 502,837 105% 60% ONLINEONLINE 2013 2012
- 13. RFM – As a Matter of Course… … Track Customer Segment Monthly Changes MARKETING DASHBOARD - DUMMY FIGURES MONTH/SEGMENT TOTAL START OF MONTH TOTAL END OF MONTH % BUYERS DEMAND BUYERS DEMAND % TOTAL DEMAND TOTAL START OF MONTH TOTAL END OF MONTH % BU January Multi Active 0-2 77,186 104,123 135% 10,261 £613,669 7,676 £341,221 56% 74,617 63,709 85% 1 Multi Lapsed 3-4 56,186 42,332 75% 1,318 £46,881 510 £18,638 40% 49,827 59,710 120% Multi Inactive 5-6 25,291 25,722 102% 493 £16,369 173 £5,241 32% 23,779 23,925 101% Single Active 0-2 59,511 57,725 97% 2,698 £96,966 1,448 £54,153 56% 62,897 62,376 99% Single Lapsed 3-4 56,663 53,970 95% 710 £22,724 389 £12,834 56% 50,630 48,758 96% Single Inactive 5-6 31,003 35,168 113% 222 £6,898 116 £3,849 56% 10,856 14,163 130% Dormant >6 163,785 168,336 103% 742 £22,161 215 £6,723 30% 203,998 206,692 101% New buyers 5,711 £171,270 3,138 £106,078 62% TOTAL 469,625 487,376 104% 22,155 £996,936 13,665 £548,737 55% 476,603 479,334 101% 2 February Multi Active 0-2 104,123 77,621 75% 9,849 £393,979 4,480 £178,448 45% 63,709 70,123 110% Multi Lapsed 3-4 42,332 58,786 139% 998 £34,588 463 £17,243 50% 59,710 55,516 93% Multi Inactive 5-6 25,722 26,006 101% 388 £12,356 153 £5,309 43% 23,925 23,738 99% Single Active 0-2 57,725 56,734 98% 2,193 £77,657 1,242 £46,931 60% 62,376 60,569 97% Single Lapsed 3-4 53,970 52,617 97% 537 £15,749 313 £9,859 63% 48,758 50,559 104% Single Inactive 5-6 35,168 29,304 83% 217 £5,623 116 £3,407 61% 14,163 15,234 108% Dormant >6 168,336 229,779 137% 534 £14,437 169 £5,649 39% 206,692 227,098 110% New buyers 6,559 £175,993 3,316 £110,019 63% TOTAL 487,376 530,847 109% 21,275 £730,382 10,252 £376,864 52% 479,334 502,837 105% 1 TOTAL ONLINE 2013
- 14. Constantly Track New Customer Conversion RANGE 1 - New Customer LTV Trackler - Conversion 2013 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 NEW BUYERS 53,619 14,935 5,818 5,859 35,518 20,880 3,701 5,964 43,087 SAME QUARTER (excl 1st order) 2011 Q1 2011 Q2 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1 2nd Purchasers 3802 1017 395 162 1997 762 266 285 2460 % 2nd Purchasers 7.1% 6.8% 6.8% 2.8% 5.6% 3.6% 7.2% 4.8% 5.7% 1st quarter forllowing acquisition 2011 Q2 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1 2nd Purchasers 2473 523 385 1670 4055 821 353 1705 % 2nd Purchasers 4.6% 3.5% 6.6% 28.5% 11.4% 3.9% 9.5% 28.6% 2nd quarter forllowing acquisition 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1 2nd Purchasers 1344 192 945 235 1363 821 1635 % 2nd Purchasers 2.5% 1.3% 16.3% 4.0% 3.8% 3.9% 44.2% 3rd quarter forllowing acquisition 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1 2nd Purchasers 950 1182 305 259 1985 2011 % 2nd Purchasers 1.8% 7.9% 5.2% 4.4% 5.6% 9.6% 4th quarter forllowing acquisition 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1 2nd Purchasers 8182 827 478 321 4969 % 2nd Purchasers 15.3% 5.5% 8.2% 5.5% 14.0% 5th quarter forllowing acquisition 2012 Q2 2012 Q3 2012 Q4 2013 Q1 2nd Purchasers 1406 295 274 514 % 2nd Purchasers 2.6% 2.0% 4.7% 8.8% 6th quarter forllowing acquisition 2012 Q3 2012 Q4 2013 Q1 2nd Purchasers 507 168 1155 % 2nd Purchasers 0.9% 1.1% 19.9% 7th quarter forllowing acquisition 2012 Q4 2013 Q1 2nd Purchasers 338 25 % 2nd Purchasers 0.6% 0.2% TOTAL 2nd Purchasers 19,001 4,227 3,937 3,161 14,370 4,415 2,254 1,990 2,460 % 2nd Purchasers 35.4% 28.3% 67.7% 54.0% 40.5% 21.1% 60.9% 33.4% 5.7% 2011 2012
- 15. Track New Customer Conversion - 2 RANGE 1 - New Customer LTV Trackler - Conversion Q1 Q2 Q3 Q4 Q1 Q2 NEW BUYERS 53,619 14,935 5,818 5,859 35,518 20,880 SAME QUARTER (excl 1st order) 2011 Q1 2011 Q2 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2nd Purchasers 3802 1017 395 162 1997 762 % 2nd Purchasers 7.1% 6.8% 6.8% 2.8% 5.6% 3.6% 1st quarter following acquisition 2011 Q2 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2nd Purchasers 2473 523 385 1670 4055 821 % 2nd Purchasers 4.6% 3.5% 6.6% 28.5% 11.4% 3.9% 2nd quarter following acquisition 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2nd Purchasers 1344 192 945 235 1363 821 % 2nd Purchasers 2.5% 1.3% 16.3% 4.0% 3.8% 3.9% 3rd quarter following acquisition 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1 2nd Purchasers 950 1182 305 259 1985 2011 % 2nd Purchasers 1.8% 7.9% 5.2% 4.4% 5.6% 9.6% 4th quarter following acquisition 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1 2nd Purchasers 8182 827 478 321 4969 % 2nd Purchasers 15.3% 5.5% 8.2% 5.5% 14.0% 2011 2012 News Customers Each Quarter (or month, etc) Same Qtr 1 Year Later New Customer Year on Year Conversion
- 16. Track New Customer Conversion - 3 RANGE 1 - New Customer LTV Trackler - Conversion Q1 Q2 Q3 Q4 Q1 Q2 Q3 NEW BUYERS 53,619 14,935 5,818 5,859 35,518 20,880 3,701 SAME QUARTER (excl 1st order) 2011 Q1 2011 Q2 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2nd Purchasers 3802 1017 395 162 1997 762 266 % 2nd Purchasers 7.1% 6.8% 6.8% 2.8% 5.6% 3.6% 7.2% 1st quarter following acquisition 2011 Q2 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2nd Purchasers 2473 523 385 1670 4055 821 353 % 2nd Purchasers 4.6% 3.5% 6.6% 28.5% 11.4% 3.9% 9.5% 2nd quarter following acquisition 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1 2nd Purchasers 1344 192 945 235 1363 821 1635 % 2nd Purchasers 2.5% 1.3% 16.3% 4.0% 3.8% 3.9% 44.2% Quarters 3 to 5 NOT SHOWN 6th quarter following acquisition 2012 Q3 2012 Q4 2013 Q1 2nd Purchasers 507 168 1155 % 2nd Purchasers 0.9% 1.1% 19.9% 7th quarter following acquisition 2012 Q4 2013 Q1 2nd Purchasers 338 25 % 2nd Purchasers 0.6% 0.2% TOTAL 2nd Purchasers 19,001 4,227 3,937 3,161 14,370 4,415 2,254 % 2nd Purchasers 35.4% 28.3% 67.7% 54.0% 40.5% 21.1% 60.9% 2011 2012 New Customer Year on Year Conversion
- 17. Going Beyond RFM – CHAID (Chi-square Automatic Interaction Detection or Classification Tree)
- 18. CHAID Gains Chart Improving Performance of Marginal Data Predicted Response / Profit Gain for Each Segment (476 = + 376% over average) 100 = Effect of Mailing All Cells – ie 100% of AVERAGE (Normal) Response This group is expected to achieve only 31% response of average for ALL groups.
- 19. Segmentation – ROI Objectives Recruitment and Reactivation – At What Cost? • 1 - Lifetime Value is a Direct Function of Recruitment Cost • 2 – IF YOU Allow Marketers to Recruit / Reactivate at a Cost • - That’s What They’ll Do • 3 – Think CASH MARGIN - AVOID Complex Accounting Concepts • 4 – Reactivated Customers (Generally) Behave Just Like New Customers
- 20. Segmentation – ROI Objectives Recruitment and Reactivation – At What Cost?
- 21. Mailing Selections and Segmentation STEP 1 - File Analysis Leads on to Creating the Mailing Plan STEP 2 – Sales Forecasts STEP 3 – Mailing Pack Selection and Source Code Allocation STEP 4 – Outsourced Marginal Customer Group Optimisation
- 22. STEP 1 – Historic Analysis Leads and Mailing Plan Order Frequency % Conv Previous Buyers Q4,2011 4 7.1% Q3,2011 4 10.4% Q2,2011 4 9.7% Q1,2011 4 9.5% Q4,2010 4 10.9% Q3,2010 4 9.8% Q2,2010 4 6.2% Q1,2010 4 3.0% Q4,2009 4 2.1% Q3, 2009 4 2.0% Q2, 2009 4 1.2% Q1, 2009 4 3.3% Q4, 2008 4 6.0% Q3, 2008 4 0.0% Q2, 2008 4 0.0% Q1, 2008 4 1.0% FREQUENCY TOTAL 7.6% LAST YEAR'S EQUIVALENT DATA or AVERAGED DATA For Each RFM Segment define – - Conversion Rate - Forecast £ Order Value ( Use Previous Year’s Equivalent Data OR Use Averages For Similar Programmes) Next …. Overlay NEW Database Counts for Each Segment
- 23. STEP 1 – continued TODAY'S COUNTS QUANTITY to SELECT FORECAST Order Frequency % Conv DATA FROM Mailing Volume Buyers Orders Previous Buyers Q4,2011 4 7.1% Q4,2012 2,372 2,372 168 Q3,2011 4 10.4% Q3,2012 13,472 13,472 1,401 Q2,2011 4 9.7% Q2,2012 4,339 4,339 421 Q1,2011 4 9.5% Q1,2012 16,935 16,935 1,613 Q4,2010 4 10.9% Q4,2011 564 564 61 Q3,2010 4 9.8% Q3,2011 1,136 1,136 111 Q2,2010 4 6.2% Q2,2011 2,143 2,143 133 Q1,2010 4 3.0% Q1,2011 9,158 5,000 151 Q4,2009 4 2.1% Q4,2010 2,376 Q3, 2009 4 2.0% Q3,2010 2,007 Q2, 2009 4 1.2% Q2,2010 2,478 Q1, 2009 4 3.3% Q1,2010 4,153 4,153 138 Q4, 2008 4 6.0% Q4,2009 720 720 43 Q3, 2008 4 0.0% Q3, 2009 - Q2, 2008 4 0.0% Q2, 2009 - Q1, 2008 4 1.0% Q1, 2009 2,332 FREQUENCY TOTAL 7.6% 83,341 51,226 4,238 LAST YEAR'S EQUIVALENT DATA or AVERAGED DATA
- 24. STEP 2 - Mailing Segment Sales Forecast TODAY'S COUNTS QUANTITY to SELECT FORECAST DATA FROM Order Frequency % Conv Mailing Volume Buyers Orders £ Order Value Forecast Sales Q4,2012 4 7.1% 2,372 2,372 168 £39.88 £6,682 Q3,2012 4 10.4% 13,472 13,472 1,401 £41.17 £57,667 Q2,2012 4 9.7% 4,339 4,339 421 £45.83 £19,284 Q1,2012 4 9.5% 16,935 16,935 1,613 £44.49 £71,753 Q4,2011 4 10.9% 564 564 61 £39.76 £2,440 Q3,2011 4 9.8% 1,136 1,136 111 £50.52 £5,598 Q2,2011 4 6.2% 2,143 2,143 133 £40.40 £5,364 Q1,2011 4 3.0% 9,158 5,000 151 £39.23 £5,906 Q4,2010 4 2.1% 2,376 Q3,2010 4 2.0% 2,007 Q2,2010 4 1.2% 2,478 Q1,2010 4 3.3% 4,153 4,153 138 £33.65 £4,628 Q4,2009 4 6.0% 720 720 43 £32.62 £1,398 Q3, 2009 4 0.0% - Q2, 2009 4 0.0% - Q1, 2009 4 1.0% 2,332 TOTAL 4 8.3% 61,854 50,834 4,238 £180,719
- 25. STEP 3 – Mailing Pack Selection TODAY'S COUNTS QUANTITY to SELECT DATA FROM Order Frequency % Conv Mailing Volume Buyers Qty Code Qty Code Qty Code Qty Code Qty Code Q4,2012 4 7.1% 2,372 2,372 2,372 V1 Q3,2012 4 10.4% 13,472 13,472 7,472 V2 2,000 T12 2,000 T22 2,000 C2 Q2,2012 4 9.7% 4,339 4,339 4,339 V3 Q1,2012 4 9.5% 16,935 16,935 7,935 V4 3,000 T14 3,000 T24 3,000 C4 Q4,2011 4 10.9% 564 564 564 L1 Q3,2011 4 9.8% 1,136 1,136 1,136 L2 Q2,2011 4 6.2% 2,143 2,143 2,143 L3 Q1,2011 4 3.0% 9,158 5,000 5,000 L4 Q4,2010 4 2.1% 2,376 Q3,2010 4 2.0% 2,007 Q2,2010 4 1.2% 2,478 Q1,2010 4 3.3% 4,153 4,153 4,153 L5 Q4,2009 4 6.0% 720 720 720 L6 Q3, 2009 4 0.0% - Q2, 2009 4 0.0% - Q1, 2009 4 1.0% 2,332 TOTAL 4 8.3% 61,854 50,834 22,118 13,716 5,000 5,000 5,000 Check 50,834 Mailing Pack 1 VIP CUSTOMERS Mailing Pack 2 LAPSED CUSTOMERS Mailing Pack 3 TEST FREE P&p Mailing Pack 4 TEST £5 LOYALTY Mailing Pack 1 VIP CUSTOMERS CONTROL What makes a control cell ?
- 26. STEP 4 – Optimising Marginal Groups… … using data coops Experience of One Fashion Brand •Targetted 3 separate parts of the “fashion brand’s” database •24+ month buyers •13+ month enquirers •“low” score customers – 0-24 month, 1 purchase, low AOV •Aggregate response •24+ month buyers: 3.22% •13+ month enquirers: 0.43% •“low” score optimisation: 4.93% • Now Provides approximately 120,000 additional customers to mail Data Supplied by -
- 27. CRITIQUES PART 1 – ORDERING A CATALOGUE
- 28. RNLI Very quick and easy....
- 29. With branded follow up email
- 30. DOGALOGUE • Good position but a little small • Like the bone • And offer of braille, print or CD
- 31. Stronger links from charity site?
- 32. SEASALT •Hard to find •But easy once we did
- 33. DANBURY MINT • Request button was hidden (bottom left) • But easy to order • Nice thank you message
- 34. Nice on-screen message But the email jarred....
- 35. ACTION ON HEARING LOSS Tiny line at the bottom of the page
- 36. Confused thank you message
- 37. HOTEL CHOCOLAT Hidden – but easy to order once found...
- 38. BAKER ROSS • Good to ask for relevant information (Who are you ordering for?)
- 39. But unfriendly error messages...
- 40. FORCE4 CHANDLERY • Good home page promotion
- 41. It autofilled, then told me off for its own mistake....
- 42. HOUSE OF BATH • Or House of Horrors? • 6 unfriendly steps for a simple catalogue request.
- 52. LEGO • Another click-intensive catalogue request process
- 53. You want my date of birth?
- 54. • But Lego, I want a catalogue, not your emails....
- 56. At last
- 57. TTS
- 59. I have to wait a month!!!!
- 60. • In a nutshell the Lifetime Value of a customer is… • The average purchase value, multiplied by the number of times they buy from • you in a year, multiplied by the number of years they remain your customer. • Once you know this... • …you’ll know what you can afford to spend in order to get new customers.
- 62. LAKELAND Excellent envelope Selling from the start.... ...whichever side it lands on the mat
- 63. LAKELAND • Subheads to help differentiate ie: • Light weight, value, deluxe feature packed • Or to flag benefits eg: • Protect your china
- 64. LAKELAND • Separate leaflet – got rather lost in the pack • Refer to it in the letter? • Is it a welcome first time offer? Or for everyone? • Make threshold line larger and word as: WHEN YOU SPEND £60 or more •Add web address
- 65. SEASALT • Full of charm – but frightened to sell • Needs web and phone on the front. These say ‘Here are things for sale’ rather than ‘Here are things to look at
- 66. SEASALT • P2 - Doesn’t say strongly enough that ALL Seasalt coats are waterproof. • Too much irrelevant detail – eg Different weights some with quilted lining some without • Guarantee? • P3 wasted opportunity to sell
- 67. • Possibly put price last • Sidebar looks like navigation not product name • Indoor photograph – so needs to communicate ‘Waterproof’. • Use copy to explain things that are not obvious from the photo such as warmth, weight, feel • ‘Details’ list is a long block of text. Possibly make it more scannable with sub-heads, different fonts or different bullet styles eg: one for style details another for functional details, another for care & fabric content details • Phone and web address? SEASALT
- 68. SEASALT • Waste of prime selling space in centre pages • Catalogue too small to need an index • Might be useful as a comparison chart, but needs more info for each coat
- 69. HOTEL CHOCOLAT • 3 arrived in one day • Plain envelope, no return address, no letter • Excellent branding • Beautiful product shots – but no enjoyment shots
- 70. HOTEL CHOCOLAT • Happiness Guarantee – don’t hide it away • Delivery information (how protected in transit? • Confusing delivery costs • Why 5% and not free delivery?
- 71. HOTEL CHOCOLAT • Chic and beautiful on gorgeous paper – but hard to read • To drive traffic to website needs stronger call to action
- 72. ACTION ON HEARING LOSS • Expensive flap
- 73. ACTION ON HEARING LOSS • Icons better below not above product • Bestseller should be a flash not an icon • Smaller text – larger photos • Try different fonts, sizes, tints • One column of copy if poss
- 74. ACTION ON HEARING LOSS • Consider sub-heads with benefits eg: • Get alerts when your phone rings • Know when your baby is crying • Or to differentiate similar products • Start copy with active words rather than ‘The’ or ‘This’.
- 75. LEGO • Strong superman image –but brave to go for an all-illustration cover with no photo of a smiling, engrossed child • FREE DELIVERY and FREE GIFT – somewhat lost on a busy cover • Plain graphics like on page 2 would help it stand out • Ordering info could also be stronger
- 76. LEGO • VIP programme – a huge missed opportunity • White text on blue impossible to read
- 77. LEGO • Improve signposting of age range • Put no of pieces at the bottom near price – to add value to the cost. • Place choking disclaimer in a less prominent position. Do you need the warning triangle? • Beef up footers – it’s hard to find web address • Remind of free delivery, with a strong, plain graphic.
- 78. DIABETES UK • Aim for one big picture not lots of little ones • Font sizes hierarchy: Autumn/Winter not important but web address is. • Red colour doesn’t reflect the brand
- 79. DIABETES UK • Expensive order form • Folded • Perforated • Gummed • Lots of space • Write in a suggested donation amount
- 80. DIABETES UK • Lots of wasted space in prime hotspot • Hard to read welcome letter
- 81. ACTION ON HEARING LOSS • Expensive flap
- 82. ACTION ON HEARING LOSS • Icons better below not above product • Bestseller should be a flash not an icon • Smaller text – larger photos • Try different fonts, sizes, tints • One column of copy if poss
- 83. ACTION ON HEARING LOSS • Consider sub-heads with benefits eg: • Get alerts when your phone rings • Know when your baby is crying • Or to differentiate similar products • Start copy with active words rather than ‘The’ or ‘This’.
- 84. LEGO • Strong superman image –but brave to go for an all-illustration cover with no photo of a smiling, engrossed child • FREE DELIVERY and FREE GIFT – somewhat lost on a busy cover • Plain graphics like on page 2 would help it stand out • Ordering info could also be stronger
- 85. LEGO • VIP programme – a huge missed opportunity • White text on blue impossible to read
- 86. LEGO • Improve signposting of age range • Put no of pieces at the bottom near price – to add value to the cost. • Place choking disclaimer in a less prominent position. Do you need the warning triangle? • Beef up footers – it’s hard to find web address • Remind of free delivery, with a strong, plain graphic.
- 87. DIABETES UK • Aim for one big picture not lots of little ones • Font sizes hierarchy: Autumn/Winter not important but web address is. • Red colour doesn’t reflect the brand
- 88. DIABETES UK • Expensive order form • Folded • Perforated • Gummed • Lots of space • Write in a suggested donation amount
- 89. DIABETES UK • Lots of wasted space in prime hotspot • Hard to read welcome letter
- 90. FORCE 4 CHANDLERY • Keep web and phone together • Don’t need towns on the front cover • Strapline unique to the brand
- 91. FORCE 4 CHANDLERY • Product categories at top, order information at bottom • Repeating product name top and bottom wastes space. • Dark blue product name floats – doesn’t relate to product. • Generally more personality
- 92. TTS • Ok – So everything was in a thick polylope – but this is a multi catalogue company. • 156 page Specialist Teachers’ Maths Catalogue • Perfect Bound covered Annual Reference • Robust UV varnished cover
- 93. TTS • Personalised Letter • Call to action flyer – reverse was plain … when you have so much to say • £25 off £100 order on flyer • FREE delivery too in letter – but on flyer
- 94. TTS • Clear Signposting on page 2 and 3 • Perhaps a Guarantee • Classic position for contents
- 95. TTS • Clear section planning through use of tints • Each section with its own contents listing • It’s hard to fault this catalogue
- 96. DOGALOGUE • Sticker on polylope – no return address • Size & 40 pages = expensive • Good to have Free p&p on front cover – but place bottom right • Mention Free gift too • Make gifts time limited? • Insets good – but add in page numbers
- 97. DOGALOGUE • P2 – summarise order information to make shorter • Add short contents
- 98. DOGALOGUE • Best-sellers label • OUR BESTSELLING CARDS • Bows– photograph them out of the pack • FREE GIFT (worth £2.99) when you buy 4 packs of cards • Blank parcel graphic wastes a valuable hotspot
- 100. BAKER ROSS • Arrived within 1 day • Only one to arrive in less than 7 days • Nice envelope
- 101. BAKER ROSS • Good hardworking catalogue • Make better use of hot spot bottom right
- 102. BAKER ROSS • Editorial – consider making separate leaflet – or offer as a free gift with purchase • Also use as web pages or downloads on website • Toys – consider renaming stocking fillers
- 103. BAKER ROSS • Footers – alternate with web and phone on right hand page • Buy with confidence – not Buy in confidence
- 104. DANBURY MINT • Arrived in plain C4 envelope (catalogue 165 x 240 format). • Re-writing the letter copuld do wonders • Inviting cover – good shop window • Only Martin received a catalogue • Classic design for this older collectors’ audience… BUT how does the Brand move on
- 105. DANBURY MINT • Great Use of Panels to Highlight Products • Classic design for this older collectors’ audience… BUT how does the Brand move on • Excellent order form, with inline finished envelope
- 106. HOUSE OF BATH • Great cover – fresh, inviting • Large lifestyle photo • Headline contains brand proposition, benefit and seasonality • Clear offer bottom right • Prominent web & phone
- 107. HOUSE OF BATH Good letter Well presented Smart use of paper Mrs Mel Henson?
- 108. HOUSE OF BATH Second letter – different signature? Icons don’t need to be shown – or link to offer eg: 10% OFF – on top of these great offers Guarantee looks like legal disclaimer, not a trusted benefit
- 109. HOUSE OF BATH Good use of paper – lasered address ? Die cut window in catalogue? • Phone number & web address should be larger ? Needs a line for customer to deduct 10%
- 110. HOUSE OF BATH • Tint panels easy to navigate • Well designed ‘New’ and ‘Great Value’ Flashes • Call-outs • Insets • Bullets • HYS (Have you seen?)
- 111. HOUSE OF BATH Great sale pricing layout • Time consuming to work out • Fiddly to layout • A pain to proof read • But so effective
- 112. Questions?