Magazine article Marketing

Weak Delivery of a Strong Message about Customers

Magazine article Marketing

Weak Delivery of a Strong Message about Customers

Article excerpt

At my age you start to lose touch with reality. I realised this the other day whilst preparing an exquisite lamb casserole. I heard a radio commercial for Ford Transit - rather good too, I thought, until the last line: 'Simply Britain's best-loved van'.

Do people love vans? I know they love cars. The MG may have inspired a few well-lubed orgasms, but can you have a loving relationship with a Transit? Which bits do you fondle? I don't know; it seems a remarkably perverse manifestation of loyalty.

But that's not what I want to write about today. My subject is a new book All Customers Are Not Created Equal by Garth Hallberg, which sells an idea called "Differential Marketing". I am interested because about eight years ago a couple of bright colleagues at O&M Direct, London - Rod Wright and Bart Casey - devised a neat little tool called the Value Spectrum for determining how best to direct your direct marketing.

It was based on the Pareto Principle - 80% of the money is spent by only 20% of the people. It was a practical analysis of the implications behind a maxim I have been boring people with for years: Why speak to everybody when you only need speak to somebody?

Many people don't buy your generic product at all. Of those who do, some spend much more than others - my favourite example is that 2% of the population drinks 80% of all vodka. And of those that do buy the generic product, only some are your customers, of whom, again, a minority spend most.

The book explores this in detail, pointing out especially that if you consider not just who buys and prefers your brand but who makes your profit, some startling figures emerge. …

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