The recent decision by J.C. Penney to close their catalog business has sparked quite a debate on whether or not that was the right choice. Some industry experts will inevitably make the generalization that this represents another nail in the coffin for catalog or direct marketing. Regardless, the strategic decision made by J.C. Penney was rooted in good analysis and forecasts that they will profit to the tune of $25,000,000 to $30,000,000 per year by re-strategizing their customer contact strategy.
Even though direct mail spending is forecasted to grow 5.8% to $47.8 billion this year, driven by marketing acquisition programs, the fact is that any business will re-strategize their efforts to do what is right for their business and make these decisions by using their own metrics. Ultimately the key intelligence factor is knowing which marketing channels drive the best response.
A seasoned marketer will need to think of three key things when going through marketing cross-channel analysis:
- Measure the eco-system, not the event.
Today’s complex marketing environment means that by nature, a customer or prospect receives multiple marketing touches during the purchase cycle. Attributing 100% of a response, or purchase, to a single event does not tell you the whole story. You need to measure the entire series of events that drove that customer to purchase, not just the last touch.
- Execute holdout tests.
In order to truly understand the impact of withholding a marketing channel, you need to ensure that you are measuring the lift that the channel provides to your marketing eco-system. Make sure that you are consistently doing hold outs and control groups within your marketing so that your decision is properly informed.
- Don’t listen to the pundits.
Your answer is only found within your own data. There are tons of technorati, digerati and social media elite that will tell you that a particular marketing channel is dead or dying and being replaced by another. That statement is only true if your data says it is true. Listen to your customers and how they are interacting with your brand, then make an informed decision.
As data-driven marketers we need to think about our business as a marketing eco-system. Removing one component of your marketing/communications can have disastrous consequences (e.g. cut off the food supply) for other parts of your business. It is time that we start thinking about the entirety of the brand and not silo any channel without the appropriate intelligence. 2011 will be the year where marketers can have the tools to coordinate their messaging and optimize in cross-channel customer engagement and interaction. After all…customers are demanding it.