System and Method for Increasing the Effectiveness of Customer Contact Strategies

Abstract

A method, and system for increasing the efficiency of customer contact strategies is disclosed. Customers are analyzed based upon historical criteria; a promotional plan (a group of promotion events implemented or to be implemented over a particular time period) is analyzed to determine the effect of each promotion event on the other promotion events in the promotional plan; and, based on this analysis, the optimal promotion stream (a specific subset of the promotional plan to be sent to customers or a group of similar customers) is determined so as to maximize the ROI of the promotional plan as a whole.

Description

CROSS-REFERENCE TO RELATED APPLICATIONS [0001] This application is a continuation of U.S. application Ser. No. 10 / 401,935, filed Mar. 27, 2003, which is a continuation of, and claims priority to, U.S. application Ser. No. 09 / 398,921, filed Sep. 16, 1999, now U.S. Pat. No. 6,567,786, issued May 20, 2003.FIELD OF THE INVENTION [0002] The present invention relates generally to a marketing system and method, and in particular, to a system and method for increasing the effectiveness of customer contact strategies. BACKGROUND OF THE INVENTION [0003] Direct marketing involves advertising to customers at a location other than the point of sale. Catalogs, first-class mail, telemarketing, and e-mail are some examples of direct marketing techniques that are currently utilized to promote the sale of goods or services. [0004] Direct marketers today face challenges that are far different than those with which the industry contended during its explosive growth over the last twenty years. Among the...

AI Technical Summary

Benefits of technology

The present invention is a new marketing method that takes a global approach to customer promotion events. It analyzes customers based on historical data and determines the impact of promotion events on each other. This analysis helps to determine the optimal promotion stream for maximizing the overall return on investment of the promotional plan. The invention focuses on a particular customer or customer group and their impact on the entire set of promotion events proposed to be implemented over a period of time, rather than just individual promotion events. It also considers the impact of saturation and cannibalization on promotion events occurring before or after a particular promotion start date.

Problems solved by technology

Among the problems of particular interest: The percentage of households purchasing through the mail has been essentially flat since 1993.

While these efforts have helped reduce the negative impact of the changing marketing atmosphere, the industry has not been able to improve the average response rate to direct marketing.

Though the RFM technique achieves adequate results, since the focus is on only a single proposed marketing campaign at a time, a marketer ends up saturating its best customers with promotions, often sending out a subsequent and possibly redundant promotion before the previous promotion has been allowed to generate it's maximum return-on-investment (ROI).

Further, low RFM customers, which may represent a major growth opportunity for the marketer, receive little or no attention.

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