Show Me The Data: Marketing To the Infrequent Buyer

Nov 06, 2006 10:37 PM  By

You know you should time your list rental and mailing frequencies to the average buying cycle of your dominant customer segment. When you profile your customers you can segment them by frequency. For example, mid-sized businesses purchase high-technology items three to four times a year, all year. Your mailings should reach every active account at least that many times to keep your message and your merchandise at the top of their minds.

You might overlook a large segment of your business if you limit your mailings to customers that fall within the dominant segment’s buying frequency. Using a 12- or 24-month cut-off as part of your definition of active customers could lead you to miss good customers. This is because neither the recency or frequency factors are considered exclusively. Limiting your circulation to accounts that fall into the middle to high RF or RFM model scores misses one type of customer I have seen in clients’ files.

This infrequent customer type falls to the distant end of the buying cycle compared to your core customers. They can explode with demand for your products after long periods due to their calendars or budget processes and stock up until the next explosion. Some smaller businesses rotate fulfillment of needs through all of their departments over a multiyear budgeting process: updating systems or office needs every two, three or four years. They have to accommodate the integration of new hardware and software, new furnishings or new non-mandatory procedures with limited staff and resources. Drawing out the acquisition process motivates the staff to focus on the absolutely necessary items and to insure implementation once the purchases and acquisitions are made.

Most U.S. businesses, 98.6%, have less than 100 employees and can fall into this extended buying cycle segment for some of the items and services they buy. You might find accounts like this in your file if you specifically look for them. They will likely not need more than three or four mailings a year to prompt their purchasing if you identify their cycles correctly. If you do not have many infrequent buyers, call them up and ask what their cycles are so that you can send them three or four mailings just before you expect their next purchase. Or put them on a separate circulation plan to mail them only once or twice a year. Either way, you will not overlook them and lose all contact with them. They in turn are likely to reward your patience with their lower recency and frequency but potentially higher monetary value orders when their cycle comes around to your products again.

Bill Singleton, president of Algonquin, IL-based consultancy Singleton Marketing, and pens “Show Me the Data” for the Lists & Data Strategies e-newsletter.