Marketing Effectiveness
Relevant and timely communication with customers plays a vital part in building long term relationships. It is a widely known that the cost of attracting a new customer is several times more than retaining an existing one.
Consequently, it is more important than ever that each customer communication is accurate and relevant to their specific needs. If for example a customer receives an offer where their name is spelt incorrectly and their vehicle details are ten years out of date, the relationship is likely to be damaged and the customer more likely to take their trade elsewhere.
An accurate customer database a key to unlock success
The starting point in this process is an accurate customer database – a valuable business asset and a gold mine of revenue generating activity.
‘A database is a tool, nothing more. It is your skill at building the database, analysing the information it holds and using your knowledge to construct more effective communications that will determine your success’
- Drayton Bird – World renowned marketing guru
‘Direct Marketing continues to be effective in generating response and sales. The challenge is to maintain the relevance of items sent’
- Direct Mail Information Service
The objective of this document is to explain how to produce regular customer communications using the customers’ preferred method whilst making sure that only relevant information and offers are sent to them.
The Facts
ADP customer research asked dealers what they perceived as being the key drivers in the current economic climate,
‘Customer traffic through the dealership has decreased.’
‘Sales are the biggest challenge and focus on marketing and advertising will be a priority’
To reinforce these findings, 54% of those surveyed expressed concerns about the effectiveness of their marketing activity.
Best Practice?
ADP conducted a benchmarking exercise amongst its customers to identify what best practices processes and controls were in use. The purpose of the exercise was to evaluate to what extent the group used the tools available in their Autoline dealer management system specifically to produce service reminders electronically, with the appropriate follow-up communications.
The exercise considered:
1. What is the level of system setup and usage for -
– the use of mandatory and advisable fields for e-mail?
– the use of follow-up contacts to chase with a phone call?
2. What is the level of activity for:
– the percentage of customers with e-mail?
– the number of reminders sent?
– the number of follow-up contacts?
Conclusions
The findings showed that the use of mandatory and advisable fields are not fully utilised amongst the benchmark group to ensure data quality when capturing and entering customer details.
- There is a significant opportunity to increase the number of e-mail reminders sent and in turn reduce communication costs.
- There is a low utilisation of follow-up calls to increase response rates.
- The benchmark group tend to use email reminders or follow up calls however not a combination of both.
How can the Autoline system help?
Processes and tools available in the Autoline system allow the use of mandatory and advisable fields to ensure data quality – especially at the point of capture.
The system includes maintenance tools to help to cleanse the database to keep it up-to-date and the standard set of reports available can be used to monitor the accuracy of data entered and maintained.
Monorep, a Vauxhall dealership based in West London works hard to ensure that their database is accurate – they run an automated data quality report every 5 minutes in Autoline. This report checks and validates all new information entered and automatically emails the user to notify them of any missing data.
Autoline includes an option to select each customer’s preferred contact method. When a campaign is run, it will then format it to this preference. The system offers the facility to produce planned or ad-hoc communication by e-mail or SMS with the functionality to create a list of follow-up calls to increase response rates. In terms of activity reporting, Autoline is able to analyse customer responses by contact, measure the response rates and therefore report on the results of each campaign.
Reduce Marketing Costs
By ensuring that email addresses and mobile numbers are captured, email and SMS campaigns offer a more efficient and cost effective method to send offers and information.
The process of sending a campaign by letter is more time consuming due to the printing, folding, filling and posting involved. There is a clear cost saving as there is no printing, paper/envelope/postage or fulfilment costs. Therefore if the average cost to send a letter campaign is £1 per customer and 5000 service reminders are being sent a year on average, there is a potential to save £5000 in marketing costs by using email instead. A link within the email to the on-line service booking facility on a dealership's website can also dramatically help to increase responses as it makes it easier for customers to act immediately.
What to do next?
ADP advises that clear processes using mandatory fields to capture customer data should be in place. To maximise on the database ‘gold mine of revenue generating activity’, it is essential to have a company-wide business objective to adhere to data quality standards.
Let the dealer management system do the work. Within Autoline for example, the campaign tool and report generator functionality make it simple to set up regular campaigns. For example: at certain points in the customers lifecycle a specific communication is sent i.e. purchase of a vehicle followed by a thank you email, 1st service due followed by a service reminder email and loan vehicle options, followed by an SMS service reminder.
There is little doubt that this focused and timely communication process helps to build customer relationships and retain their business and so reducing the pressures on marketing budgets to attract new customers.