Most of us will agree that our scientific customers go through numerous stages before coming to a purchasing decision. This process is generally referred to as AIDA – Awareness, Interest, Desire and Action – or the hierarchy of effects. Our job as marketers is to move the customer through that multi-step process as quickly as possible, usually using various marketing communications vehicles.

True database marketing should consist of a systematic series of contacts using a variety of media. This series of contacts should move a customer through the hierarchy to a purchase decision. You nudge the customer along the purchase decision pathway, setting up a continual interaction with your company that is maintained in a contact history. Each interaction provides more information on the customer and allows you to focus your efforts on those most likely to buy or to find ways to push them further along the path.

One simple example of such an approach for a new protein expression product could proceed as follows. First, you place ads, primarily in one journal, to create awareness of the new product. After some time, you purchase a list of the subscribers interested in protein expression from that journal and mail a piece with an offer designed to generate a response for those more seriously interested in your new product. Responses to that mailer are followed up with either another mailer or telesales activities which offer a discount or free sample, moving the customer closer to that final purchase. It is essential that a strategy is developed for a SERIES of contacts with the customer, that each contact be designed with a specific outcome in mind and that all leads generated have a series of "follow-up actions", either through mail, sales or telemarketing.

Budget savings

Database marketing allows you to focus more on target development. In that way, database marketing can save you money because you are becoming better at contacting ONLY those customers likely to buy, not everyone in your database. As a product manager with Marcoms experience and familiarity with the unit costs of printed pieces, I viewed it like this– if I become more efficient in my direct mail, for example, I could potentially do five mailings at the typical cost of the four budgeted. By getting closer to the real target audience with database marketing techniques, your list sizes will shrink, but so does your printing and postage total costs. Meanwhile, the sales that you generate per lead can soar.

Take an example using costs that are fairly typical and ways currently familiar to you. You wish to do a quarterly self-mailer on your protein expression products. Each piece costs $1.00 to print and mail. You pull a mail list on active names, which is defined as anyone who has contacted your company in the past 24 months. The total of that list is 30,000. Your bill comes to $30,000 per mailing, $120,000 for the year.

Now let’s say you expand your list criteria and pull names that are active as before, but also expressed interest in your protein expression products. The new list is smaller, 20,000 names, and you become concerned. Now do the math. You will spend $20,000 per mailing, $80,000 for the year, saving $40,000 for other projects. A nice chunk of change to have on hand, plus you are more certain these names have some level of interest in the protein expression products. Sure, you may have missed a few potential customers with the smaller list size, but probably not enough to forego the $40,000 yearly savings.