direct marketing definitions

customer database
a list of customer names to which additional information has been added in a systematic fashion
customer loyalty programs
programs that encourage customer repeat purchases through benefits sponsored by the organization or firm
source data
the information contained in a customer database
source code
the media, media vehicle or means by which the person has responded to become a customer
transactional data
the information contained in a customer database
rfm
recency/frequency/monetary- a mathematical formula used to evaluate the value or sales potential of customers or prospects
match code
abbreviated information about a customer record that is constructed so that each individual record can be matched, pairwise, with each other record.
merge-purge process
a computerized process used to identify and delete duplicate names/addresses within various lists
multibuyer
an individual whose name/address appears on two or more response lists simultaneously
nixie
mail that has been returned by the us postal office because it is undeliverable ass addressed
salting
the process whereby a direct marketer places decoys which are either incorrect spellings of fictitious names no a customer list to track and identify an misuse (seeding)
stealth marketing
communications secrecy in that direct marketers can communicate with small market segments or individual customers without competitors or other customers having knowledge of it
cross selling
an important characteristic of direct marketing where new and related products (or even unrelated products) are offered to existing customers
continuity selling
offers that are continued on a regular basis (club offers)
database analytics
the direct marketer analyzes customer information housed within the customer database to draw inferences about an individual customer’s needs
data mining
the process of using statistical and mathematical techniques to extract customer information from the customer database to draw inferences about an individual customer’s needs and predict future behavior.
database enhancement
adding and overlaying information to records to better describe and understand the customer
CRM
Customer relationship management- a business strategy to select and manage customers to optimize value
LTV
Customer Lifetime Value the discounted stream of revenue a customer will generate over the lifetime of his or her relationship or patronage with a company
Microtargeting
the creation and direct delivery to customers of customized winning messages, proof points, and offers, and accurately predicting their impact
PRM
partner relationship management the generation of greater value to customers through companies’ cooperation and close work with partners in other companies or departments.
Cause Related marketing
a commercial activity by which businesses and charities or causes form a partnership with each other to market an image, product, or service for mutual benefit
direct marketing
a database driven interactive process of directly communicating with targeted customers or prospects using any medium to obtain a measurable response or transaction via one or multiple channels
brand marketing
marketing that boosts knowledge of a company or product’s name, logo or slogan.
multichannel distribution/multichannel fulfillment
refers to a marketer using several competing channels of distribution to reach the same target customers
B2B
providing goods and offerings to businesses
industrial goods
products that are generally used as raw materials or in the fabrication of other goods
political micro targeting
combining groups o voters based on information about them accessible through databases and the internet to target them with specific messages
response lists
the house lists of other organizations
compiled lists
lists generated by a third party or market research firm
list brokers
serve as intermediaries who bring list users and list owners together
list managers
represent the interests of list owners and assume the responsibility on behalf of list owners, of keeping in contact with list brokers and lists users. They perform the advertising and sales functions and maintain the lists they manage in their own facility.
list compilers
organizations that develop lists and data about them, often serving as their own list managers and list brokers are called list compilers.
service bureaus
provide data processing, data mining, outsourcing, online analytical processing, and other services to support the interchange of lists and database information within the direct marketing industry.
key code
a unique identifier placed on the response device or order form prior to sending a promotional piece to prospective customers. (tracking code)
hotline names
those most recently acquired but there is no consensus in the industry about what chronological period recent describes. many lists specify three month hotline or six month hotline to detail the name categories by recency.
market segmentation
a strategy devised to attract and meet the needs of a specific submarket
product differentiation
a strategy that uses innovative design, packaging, and positioning to make a clear distinction between products and services serving the same market segment.
product positioning
the way the product is defined by consumers on important attributes. It enables consumers to rank products or services according to perceived differences between competing products or brands within a single product category.
SIC
Standard industrial classification- coding system developed by the federal government that erves as a basis for classifying statistical data and has been widely used by the government, trade associations, and business enterprises. They classify business customers by the main economic activity in which they engage.
NAICS
The NorthAmerican Industry Classification System- has replaced the SIC Coding system. Many business people felt that the SIC system failed to recognize the growth of information.
Demographics
identifiable and measurable statistics that describe the consumer population
reference groups
the people a consumer turns to for reinforcement
reference individual
a person a consumer turns to for advice
psychographics
study of lifestyles, habits, attitudes, beliefs, and value systems of individuals
cookie
an electronic tag or identifier that is placed on a personal computer
independent variables
controllable factors
random assignments
a component of a valid experiment that refers to the fact that both control and experiment group subjects must be assigned completely randomly so that differences between groups occur by chance alone.
null hypothesis
the researcher must state the hypothesis in such a way that it can be proved wrong
alternative hypothesis
the hypothesis that is determined when a nul hypothesis is proven wrong
Type 1 Error
results when the decision maker rejects the null hypothesis even though it is in fact true
type 2 error
occurs when the decision maker accepts the nul hypothesis when it is in fact not true
chi square test
one way to determine whether the difference is or is not statistically significant
degrees of freedom
defined as the number of observations that are allow to vary
market penetration
the expressed percentage relationship of customers to some benchmark universe
gross sales
total sales
unit margin
trade margin
allowable margin
the amount of money that can be spent to get an order while still permitting some left over for media costs and the designated profit to be made
CPI
Cost per inquiry
CPR
cost per response
positive option
where the customer must specifically request shipment for each offer in a series
negative option
the shipment is sent automatically unless the customer specifically requests that it not be
price skimming
a strategy that establishes the price at the highest possible level to skim the cream off the top of the market and target only a select number of consumers who can afford to buy the product/service
price penetration
strategy will help the direct marketer maximize sales volume
price elasticity
the relative change in demand for a product given a change in its price. It measures the consumer’s responsiveness or sensitivity to price changes
positioning
a marketing strategy that enables marketers to understand how each consumer perceives a company’s product or service
copy appeal
the basic underlying theme of the promotion or campaign
self mailer
any direct mail piece mailed without an envelope
solo mailers
mailing pieces promoting a single product or a limited group of related products
classic format
normally consists of six components: an outer mailing envelope, a letter, a brochure, a return device, a reply envelop, and a chit
chit
an additional enclosure card or separate slip of paper that highlights a free gift or some other information
cooperative mailings
provide participants, usually direct response advertisers, with opportunities to reduce mailing cost in reaching common prospects
bingo card
An information card is an insert or page of a magazine that is created by the publisher to provide a numeric listing of advertisers.
ROP advertisements
run of paper- positioning the ad at the will of the newspaper
Ad note
a small sticker that is placed on the front page of the newspaper that can be peeled off without damaging the newspaper
validation
refers to the way that the program minimizes fraud
inbound calls
a category of telemarketing where customers are placing calls to the organization to place an order,request more information or to obtain customer service
outbound calls
a category of telemarketing where firms place call to prospects or customers
TI
a giant pipeline or conduit through which a user may send multiple voice, data, or video signals
Auto responders
e-mails that are automatically sent
viral marketing
e-mail messages are forwdared to other consumers by a consumer
viralocity
coined to measure both the number of messages and the rate of speed by which email messages are forwarded by a consumer to other consumers
Online panels
online focus groups for marketers
E-commerce
the buying and selling of products online
key word density
the number of times that the key word in the search appears on tat web site
PR Value
how often google or other search engines indexes a site or how often they send their spiders to index a site
Back links
involve the quality of links, number of broken links, the anchor text, and the positoning of the link
aging
refers to the recency of the site and is based on the date by which it was established on the web
quality score
looks at a variety of factors to measure how relevant your keyword is to your ad text and to a user’s search query
click through rate
addresses the number of people that click on your ad
PURL
a personalized web page or microsite that incorporates the prospect’s name and is tailored to his interests based on information known about him
button chat
where the cal to action is resident on the page and the visor initiates the chat
proactive chat
where the visitor has triggered a business rule and the chat invitation pops in to the a page with a relevant call to action
abandonment rule
the rule that when visitors start to complete a form and then stall or close the form – at which point a proactive chat invitation can be issued to help complete the task
list owners
those who describe and acquire prospects who show potential of becoming customers of the list user
offer test
The most common type of test