Determine what you need to track

Before you start a marketing campaign, consider carefully what information is important to track and who you want to target. For example, if you already know which of your customers are men and which are women, you might want to send different promotions to each gender. If you don't know, that might be information that you want to track this time, so that you can better target your future campaigns.

What do you know before you start?

The information that you collect about your customers is the foundation for an effective marketing effort. When you collect customers' personal characteristics and organize customers into groups that share characteristics, it becomes possible to see patterns in their responses that are based on their common characteristics.

When you link customers' responses to the significant characteristics that influenced their decision to respond, you develop a rich store of knowledge for serving your customers better and improving the success of your subsequent marketing efforts.

Here are a few examples of the characteristics that you can track and what you can learn from them:

• Repeat customers If you identify your repeat customers, you can contact them to determine why they keep coming back or to tell them about sales and special offers.
  
• Infrequent customers If you haven't heard from customers in a while, you can offer a discount or other incentive for their repeat business. Or you can contact them to find out how you can encourage their return.
  
• Customer location If you know where they live, you can offer customers in a specific locale products or services that make sense for their climate or location.
  
• Customer gender If you know customers' gender, you can provide information about products or services that are relevant only to women or men.
  
• Customer age If you know the ages of customers, you can provide products or services that are targeted at their stage in life (such as retirement-planning strategies for those in their twenties and for those in their fifties).
  
• Purchase history If you know the purchase histories of customers who have responded to a mailing and your goal is to expand your customer base, you can purchase a mailing list of people who have bought the same products and send a similar mailing to them.
  
• Response preference By using recipients' responses, you can target each customer with a different follow-up that suits the customer's response. Some customers may respond by phone, others with a visit, and others by e-mail. Each of these suggests that you match your customers' preferences with a different follow-up approach.
  

How well are you doing?

While you are collecting information about your customers, you also want to track how well your marketing efforts are working. You need to decide which of the many variables you want to test and how you can measure their impact. For example, if you use a postcard mailer, you may want to try more than one design or offer and track the success rate for each. Other information that may be valuable to track includes:

• Rate of response Of all the customers whom you contacted, how many responded?
  
• Incentive response If you provided a few different offers to encourage customers to respond, you can track which incentives prompt the greatest response rate.
  
• Method of contact If you provide customers with different ways to respond — for example, by postcard, phone call, e-mail message, personal visit, catalog, or Web site — you can track the responses that you receive for each. If you use different methods to contact your customers, you can track them to see which was most successful in eliciting a response.
  

Isolate the variables

Be sure that you isolate the variables, or later analysis may be difficult. For example, if you use two different postcard designs and each design promotes a different offer, it may be difficult to track whether one postcard receives a higher response rate because of the design or because of the offer.

We will discuss how to Set up the tracking mechanism and its example.

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