Rethinking Customers by Dmitriy Katsel Meet Joe. The future of engaging, hyper-targeted, and customer-focused marketing. Born in 1929, Joe has owned “Joe’s Hardware Store” since 1956. Every Wednesday, Joe’s customers receive a newsletter from Joe at home. He makes five different newsletter editions and sends them to his largest customer segments. One newsletter for tools, one for landscaping, one for interior and exterior paint, one for furniture repair and one for floors. A journal is kept of what each customer is interested in and the newsletter focuses on just that. The newsletter also includes special deals for those specific products as well as tips on how to use them. Every first Saturday of the month Joe runs a construction workshop for kids in the local park where up to 50 local parents can attend for free with their children. Joe knows every customer’s name and previous major purchases. He knows this because he keeps a book with everyone’s picture and a log of their customer history. A picture is taken of every customer when they enter and a second copy is neatly placed on a growing wall of “Valuable Customers”. According to “Rethinking Marketing” by Roland T. Rust, Christine Moorman, and Ghuarav Balla from the Harvard Business Review, Joe’s Hardware Store has a very advanced, efficient and effective marketing mix model. The authors state that the conventional marketing process is becoming fundamentally flawed as it is perceived by common assumptions. The process of brand managers pushing products through mass marketing to achieve short-term Actionable Insight sales results is becoming increasingly at odds with customers and the economy. Everything from the Companies must shift from focusing on organizational structures to ROI evaluations must be the profitiability of a product to the reconfigured to focus on the long term customer value profitability of a customer rather than short term sales. At stake is not just an increase in customer acquisition rates and marketing metric clarity but the success or failure of entire corporations over the next 5-10 years.
How do these principles apply to Joe’s story? 1. Joe keeps a record of each customer. Not just their e-mail address, but their previous purchases, their interests and even their photographs. 2. Joe utilizes this data in a way that increases the effectiveness of his marketing and his customer service. Tesco follows a similar practice by utilizing data obtained from “clubcards” to distribute appropriately targeted marketing content. 3. Finally, the Joe’s Hardware Store marketing mix is a fusion of content marketing, cause marketing and product marketing. In this specific case the mixture has the customer at the heart of the marketing process. Inspired by Roland T. Rust, Christine Moorman, and Ghuarav Balla of “Rethinking Marketing”, article from the January-February 2010 issue of the Harvard Business Review. Written by Dmitriy KatselPrincipal at AdU Network. Dmitriy founded AdU Network, a company that creates research-based partnerships between universities and companies, as a senior at the University of California Santa Barbara. Within a year, companies such as JetBlue and Yahoo! hired AdU Network to partner them with the company’s network of over 30 universities.