Simple database marketing tools in customer analysis and retention

Many businesses practice database marketing to increase effectiveness in their marketing activities. The database marketing approach uses current advanced information technology to collect customer data, analyze it and use it to provide recognition and services to customers for the purpose of increasing customer loyalty and repeat sales. Over the years, the practice of database marketing has evolved into a costly implementation of highly sophisticated information technology and application, which requires elaborate planning and organizational skills for successful adoption. Consequently, the need has been recognized for a human-centred approach which focuses more on the business problem rather than on the technology. This paper introduces two simple yet essential database-marketing tools - usage segment code and net revenue equation - and describes their application in the credit-card business. The promising results obtained further demonstrate that simple yet creative ideas can be converted into powerful database marketing tools to increase the return on investment in a marketing database.