Studies show that it costs six times as much to attract a new customer as to retain a current customer. That’s why, in a world of fragmented mass media, the highest return on your marketing dollars comes from communicating with the most likely candidates to visit your resort—your existing customers, and others who resemble them.

However, budgets and efforts to develop that relationship are rare in many companies. While you might overlook these customers, though, your competitors won’t. To keep your loyalists loyal, here are some tips.


Part I: Data Acquisition
The first part is data acquisition. Collecting and maintaining quality information is the most difficult process in the chain, because customer information changes rapidly. As much as 25 percent of any e-mail list will go bad in a year. But keeping your data up to date is worth the cost. An estimated 60 percent of online users will consider opting-in to receive communications from a company whose site they are visiting. And e-mail advertising has the highest overall ROI for marketing dollars.

The first step is to develop a list-building strategy:

• Identify what you will collect, when and how.

• Keep the initial form short and simple. Gather other information later, once the initial relationship is developed.

• Collect only the information you will use—contact data, interests, habits, demographics and preferences.

Use multiple channels, from online and on-site to mail, to build your lists. Online marketing (specifically web promotions), offline advertising and direct marketing, tradeshows, and cross promotions are the most effective list-building sources. Take advantage of every customer interaction point to gather contact information and permission to e-mail.

To get people to opt in, you must convincingly explain the benefits. What will they get and how will it be delivered? Assure them that their information will not be sold to third parties. Provide links to your privacy policy.

Focus on quality rather than quantity. Unsolicited e-mails can negatively impact deliverability rates, reputation, click-throughs, and open rate statistics.


Part II: Database Management
While list acquisition is the most difficult step to achieve, database management is the most complicated. The key elements of a customer database include:

• contact data—name and address

• profile data—demographic, preference and habit information

• transactional data—sales records or other types of interactions that a customer has had with your business.

However, the full list of essential information depends on the goals of your program. Outline the type of information you eventually want, then design your database to house all that information. The database should allow you to segment the list and enable more targeted profiling of customers, which leads to higher response rates and a higher ROI.

The first rule of segmenting a customer database is to use only the attributes that make sense for your business and that you can easily target and track. Demographic segments, such as gender or marital status and presence of children, make good targets. Geographic segments are also popular. If you track transactional data, segmentation by customer behavior—what they purchase, when they visit, what they do—can help you develop a communication strategy based on customer interests.

It’s also important to keep your database clean. This may mean dropping some records from the database—a cleaner list will deliver higher ROI and improve deliverability rates.

One of the most effective ways to keep a database updated is to have customers manage their information themselves. The use of profile, preference and subscription pages on websites and e-mail tools encourages customers to update their profile information.


Part III: Communications
Collecting and storing the information is half the battle. Proper communications seal the deal and help create engaged customers. The key is to communicate with customers the way they want to be communicated with.

How should you communicate? The Direct Marketing Association reports that e-mail returns $57.25 for every dollar spent, the highest ROI of all direct marketing channels. Yet e-mail marketing often gets the smallest part of the marketing budget. And many of those who rely on it employ a “batch and blast” strategy, sending the same message to everyone in their database instead of targeting and customizing the messages.

One strategy is to employ customer lifecycle messaging. First-time members receive introductory messages with options for subscription preferences. Longer-term customers receive relevant and customized messages. Customers who have not replied or transacted with you in awhile receive messages inquiring about future interest in receiving messages, and may be targets for deactivation.

Make it easy for customers to opt out. Include an opt-out or unsubscribe option in all e-mails. You can list the address or phone number of a staff person to contact should the member have questions.

The most successful e-mail marketers integrate their e-mail campaigns with marketing efforts using other channels. For example, an e-mail campaign might go out on Thursday to build awareness for an insert in the Sunday paper. The result is increased redemption of the mass marketing piece.

The same general e-mail best-practices guidelines apply to direct mail as well: relevant, timely and customized messaging. Good mail pieces provide a trackable offer, such as a coupon that must be redeemed at the place of purchase. Redeemed coupons can be tracked to an individual based on the address label.

Likewise, all returned undeliverable mail should be noted in the database, with updated addresses if available.


Part IV: The Feedback Loop
As customer needs change, your communications with them become a constant feedback loop. The use of website profile, preference and subscription pages as well as surveys can assist in gathering the information needed to segment and target specific customer groups. Encourage completion of surveys and profile pages with incentives such as contests and giveaways. Explain that the information you gather will be used to provide customers with more relevant content and offerings from you. No customer relationship strategy is complete without continual feedback from customers.


Effort that Pays Off
Building and managing a successful customer relationship strategy often requires rethinking and retooling your database management efforts, especially if they currently treat all customers the same. It’s important to logically segment customers so you can begin a more relevant communication dialogue.

But it won’t happen overnight. Effective databases are built over years. The pay off builds over time, as more customers opt into the company’s program and you build a higher quality list. Successful companies have seen their open and click-through rates rise from below 20 percent to highs of 40 percent to 60 percent, and have seen their ROIs double. And that’s well worth the effort.