Below is an excerpt from CAREER-CHANGING TAKEAWAYS, Denny Hatch’s recent book that covers 99 categories of marketing, business and life—including business, direct marketing, advertising, brands, copywriting, direct mail and email, hiring and firing, life rules and marketing rules, P.R. and publicity. Click here to find out more.
CRM is marketing jargon for “customer retention marketing” or “customer relationship marketing.” That’s the gibberish spouted by number-crunching business school grads and MBAs. If you are in marketing, your business is to create customer relationship magic.
1. If you nickel-and-dime your customers, you will be punished
Example: After making the trek to Cézanne’s studio in Aix en Provence and seeing Mont Sainte-Victoire, which the artist painted many times, I got off the dime and made a reservation for the blockbuster show at the Philadelphia Museum of Art, “Cézanne and Beyond.”
As 15-year dues-paying members of the museum, we (my wife Peggy and I) are entitled to free tickets for special shows. When I reserved online, the tickets were refused until I gave them a credit card for a $5 fee. Instead of looking forward to the show, I feel ripped off. Now when museum fundraising letters arrive, they are thrown out unopened.
To be specific, if you offer something free and some insecure member of the management team says it’s O.K. to remove the “r” from “free” (which means you are charging a fee to allow access to the freebie), think again. You’ll get flack from two sources: your customers and the FTC.
2. Are your employees empowered to make decisions? Do they own their jobs? If not, why not?
Example: I finally got bored with The Wall Street Journal and—after spending several thousand dollars on a print subscription over the years—decided not to renew, opting instead to pay much less for the online edition.
On Jan. 6, 2009, a woman from the circulation department phoned and started calling me by my first name and touting all the wonderful improvements and a great subscription deal. “How much?” I asked. “$99 for a full year, six days a week, and that includes the online edition.”
I said, “OK, it’s a deal. I will give you a credit card.” I reached into my wallet for my credit card and started to read the number. “Please wait just a minute,” the woman said. “I have to get my supervisor on the line.”
I hung up. She called back and I said, “I don’t have time for this.” I hung up again. What were these idiots thinking?
3. Do you know the projected lifetime value of each customer? If not, why not?
Are you making marketing and advertising decisions based on solid research, or do you go by gut instinct and the creative wizardry of your advertising agency?
The late magazine consultant J. Wendell Forbes used to measure revenue per subscriber by combining total circulation, advertising and ancillary income, dividing it by the number of subscribers and then multiplying by the average number of years per subscriber (lifetime value). This figure tells the circulation manager what is the allowable cost to acquire a new subscriber.
Are your customers in one big database, or are they in silos in multiple databases in different departments or divisions that do not talk to each other? If so, why?
Always spend time talking to—and surveying—your customers. They will tell you who they are and what they want or need, which leads to profit.
If you do not know who your customers and prospects are, the business will fail.
For the past 35 years, Denny Hatch has been a direct marketing copywriter, designer and consultant. He is the author of the free e-newsletter Business Common Sense and the just-published “Career-Changing Takeaways.” He can be reached at firstname.lastname@example.org.
Denny Hatch is the author of six books on marketing and four novels, and is a direct marketing writer, designer and consultant. His latest book is “Write Everything Right!” Visit him at dennyhatch.com.