Precision Marketing
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Precision marketing is a
marketing Marketing is the process of exploring, creating, and delivering value to meet the needs of a target market in terms of goods and services; potentially including selection of a target audience; selection of certain attributes or themes to emph ...
technique that suggests successful marketing is to retain,
cross-sell Cross-selling is a sales technique involving the selling of an additional product or service to an existing customer. In practice, businesses define cross-selling in many different ways. Elements that might influence the definition might includ ...
, and
upsell Upselling is a sales technique where a seller invites the customer to purchase more expensive items, upgrades, or other add-ons to generate more revenue. While it usually involves marketing more profitable services or products, it can be simply e ...
existing customers. Precision marketing emphasizes relevance as part of the technique. To achieve Precision Marketing, marketers solicit personal preferences directly from recipients. They also collect and analyze behavioral and
transactional data In data management, the time scale of the data determines how it is processed and stored. Dynamic data or transactional data is information that is periodically updated, meaning it changes asynchronously over time as new information becomes ava ...
.


Development

The development of precision marketing coincides with the development of
market segmentation In marketing, market segmentation is the process of dividing a broad consumer or business market, normally consisting of existing and potential customers, into sub-groups of consumers (known as ''segments'') based on some type of shared characte ...
, advancements in technology and the customer's reaction to the proliferation of
mass marketing Mass marketing is a marketing strategy in which a firm decides to ignore market segment differences and appeal the whole market with one offer or one strategy, which supports the idea of broadcasting a message that will reach the largest number o ...
. Zabin and Brebach portray the development of market segmentation. They describe the inception of the term in the 1950s and show that with time, increasingly more information was considered relevant for marketing purposes. Market segmentation evolved from simple
demographics Demography () is the statistical study of populations, especially human beings. Demographic analysis examines and measures the dimensions and dynamics of populations; it can cover whole societies or groups defined by criteria such as edu ...
in the 1950s to
geodemographics Geodemography is the study of people based on where they live.; it links the sciences of demography, the study of human population dynamics, and geography, the study of the locational and spatial variation of both physical and human phenomena on Ear ...
and behavioral segmentation in the 1960s (the propensity to purchase) to
psychographics Psychographics is a qualitative methodology used to describe wikt:trait, traits of humans on psychological attributes. Psychographics have been applied to the study of personality, values, opinions, Attitudes (psychology), attitudes, self-interes ...
data in the 1970s (personality and lifestyle), to
customer loyalty The loyalty business model is a business model used in strategic management in which company resources are employed so as to increase the loyalty of customers and other stakeholders in the expectation that corporate objectives will be met or sur ...
and profitability in the 1990s and to economic data in current times. The conceptual evolution of market segmentation is the cornerstone of precision marketing. In precision marketing, segments could be defined as narrowly as follows: full-time MBA students, married with young children, planning their next vacation. The evolution of segmentation was supported by advancements in technology. The shift into digital enabled an easier capture and retention of data while increasingly efficient databases facilitated the usability of that data. Although advancements in technology were crucial to the type of market segmentation used in precision marketing, they were not the driving force behind it. Instead, customer demand and expectation, alongside the fierce competition, were the driving factors. Learmer and Simmons (Learmer & Simmons, 2007) determine that American consumers are overwhelmed by an avalanche of over 3000 marketing messages daily Marketing messages increasingly penetrate the private domain both in print (direct mail and telemarketing) and in digital (emails and mobile phone). As a result, customers are becoming less receptive to unsolicited marketing communication, specifically if it is irrelevant or impersonal. This is the context that gave rise to the practice of precision marketing.


Application

The most common applications of precision marketing are in customer retention and revitalization. Here are a few examples for precision marketing tactics that have been used by several major companies, such as
Best Western Best Western International, Inc. owns the Best Western Hotels & Resorts brand, which it licenses to over 4,700 hotels worldwide. The franchise, with its corporate headquarters in Phoenix, Arizona, includes more than 2,000 hotels in North America. ...
and
Tesco Tesco plc () is a British multinational groceries and general merchandise retailer headquartered in Welwyn Garden City, England. In 2011 it was the third-largest retailer in the world measured by gross revenues and the ninth-largest in th ...
. The German Healthcare Agency Wefra life executes their communication strategies based on this approach.


See also

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Demographic profile Demographic profiling is a form of demographic analysis used by marketers so that they may be as efficient as possible with advertising products or services and identifying any possible gaps in their marketing strategy. Demographic profiling can e ...
*
Market segmentation In marketing, market segmentation is the process of dividing a broad consumer or business market, normally consisting of existing and potential customers, into sub-groups of consumers (known as ''segments'') based on some type of shared characte ...
*
Mass marketing Mass marketing is a marketing strategy in which a firm decides to ignore market segment differences and appeal the whole market with one offer or one strategy, which supports the idea of broadcasting a message that will reach the largest number o ...
*
Niche market A niche market is the subset of the market on which a specific product is focused. The market niche defines the product features aimed at satisfying specific market needs, as well as the price range, production quality and the demographics that it ...
*
Psychographic Psychographics is a qualitative methodology used to describe traits of humans on psychological attributes. Psychographics have been applied to the study of personality, values, opinions, attitudes, interests, and lifestyles. Two approaches to ...
*
Target market A target market, also known as serviceable obtainable market (SOM), is a group of customers within a business's serviceable available market at which a business aims its marketing efforts and resources. A target market is a subset of the total ma ...


References


External links

{{Spoken Wikipedia, En-precision-marketing.ogg, date=2015-01-03 Marketing techniques Market segmentation