Database Marketing - A Short Explanation

Database marketing is actually a new form of marketing that is well liked these days. But what exactly is this database marketing? To put it simply it is collecting a reservoir of client information and storing it in a way that it can be easily accessed for use in directing marketing efforts. But first you need a database. There are two ways of generating a database for marketing.

This reservoir of prospective customer data may either be created or purchased from companies that are in the business of collecting and selling consumer databases. These companies get the permission of their clients to forward their data to sales companies. This can be done through websites or on contracts (the little blocks you tick unthinkingly when buying a cellphone contract, for example, saying things like "Do you give us permission to send youdata about additional products that become available?"). It could also be helpful to keep a database for your existing customers and any new customers you get, as that would allow you to maintain relationships with all your customers and also give them the feeling that you genuinely care, thus ensuring a degree of brand loyalty.

When it comes to the usability of database marketing, remember to consider the following scenario: you have a company that sells water purifiers and have a need to increase your sales figures dramatically. You could randomly call people (a process called cold calling) and attempt to sell your product, you will probably get rejected at least 80 percent of the time. You need to first consider, who the people are who would be possibly interested in buying a water purifier? Surely not students, as students would not be interested in buying goods like this as they are more interested in games and music than their health. On the other hand, however, housewives or married men or entrepreneurs making use of their own offices might be considering buying a water purifier. When you have a sorted database of these potentially interested people, the sales success rate will certainly increase by tenfold. Database marketing can enhance your sales success rate from a lot less than twenty percent to close to eighty percent without having to alter your sales tactics any more than targeting a specific market.

You may need to keep one thing in mind when using database marketing though. You need to be careful of contravening privacy laws. Only purchase your databases from companies who can prove that they have permission to sell the contact information for the people on their database, if this isn't the case, you could find yourself having a lawsuit on your hands. Only collect the data that you need, make sure you do not go digging deeply into the personal lives of your customers as that could put the reputation of your company in jeopardy. Database marketing could be a very successful weapon against the competition if used correctly and intelligently. It would not only help in getting new clients but will also ensure brand loyalty and increase brand recognition.

For more information on database marketing, go to http://www.3waymarketing.co.za