The Magic Box That Turns $1 Into $10
Would you be interested in a machine or “magic box” that turns every $1 you put in it into $10? Sound crazy? Well, at Loyalty Builders we have one of those. It’s for retailers, CPG and B2B companies that have lots of products and lots of customers, and who target those customers with promotional campaigns.
Let’s do the math. If you send a promotion by email to, say, 100,000 of your customers and it persuades 1% of them to make an average purchase of $100, that campaign generates $100,000 in revenue. If you can get the same results over ten campaigns per year, you get $1 million. But if those same campaigns were to get 2% of emailed customers to buy, you’d get $2 million in revenue, a $1 million revenue uplift without any additional cost or effort. So how do you do that? Well, it always costs something to make improvements. The question is how much does it cost in time and money, and for what results?
It’s no secret that the way to really pop response rates is to personalize your offers and messaging in ways that are relevant and interesting to each customer. We have seen companies triple and quadruple response rates apnd increase average order value with more relevant marketing. It’s usually difficult and expensive, however. How are you going to figure out what every customer might be interested to buy? You can segment customers along some demographic attributes or behaviors and make different offers to each segment using your marketing intuition or sales trends (e.g., offer the most popular products). Or you can take advantage of the rapid advances in the data science around predictive customer analytics.
If you want the best results, there is no longer any doubt that the right data science rocks. Unfortunately, that typically comes at the highest cost. Even with all the new technology coming into the market in this area, it usually costs top dollars involving big data integration projects, highly skilled data scientists, lots of time modeling, and still more time figuring out how to translate customer “insights” into executable campaigns.
Fortunately, new, simpler, and cost-efficient approaches are reaching the market that are more like a ready-to-use machine, an automated solution-in-a-box for marketers. There are no data integration or skills prerequisites. The Loyalty Builders “magic box” does one thing really well. It sucks in a few fields of customer purchase history in one side, and pumps out campaign lists identifying the best offers to make each customer on the other. Most email automation systems already support this kind of variable email. All you have to do is use that list to execute your campaign, and you will get a significant uplift.
In the example we started with, if you could find a magic box that produces campaign lists driving $1 million revenue uplift over your usual approach and involving no more time/effort, the only question left is, how much for the magic box? If it’s less than 1/10 of that uplift, you just turned $1 into at least $10 of revenue.
Click here for more information about Loyalty Builders “Magic Box” for direct marketing.