Sometimes customers need space says marketing specialist

By DITA DE BONI marketing writer

Direct marketing specialist Karl Dentino is coming to New Zealand next month to speak about relationship marketing, but sounds a warning from his base in New Jersey: consumers really don't have time or the interest to have a "relationship" with a company.

Mr Dentino will expand on his theories at the Direct Marketing Association's Marketing Today forum in early June, promising a wake-up call to practitioners that alienate their best customers.

In a 23-year career, Mr Dentino has created direct marketing campaigns for companies such as Proctor & Gamble, Avis, MasterCard, Merrill Lynch and Kraft/General Foods.

He says there is a lot of room for improvement in the way the direct marketing sector does its job.

Database marketers tend to "hammer away" at their best customers, but a Harvard Business Review study determined that all consumers really wanted from companies was consistency, integrity, their privacy respected and other relationships tolerated, he says.

Add that to a New York Times survey, which found that 70 per cent of defections from a service or goods provider result from service issues, not better products or prices elsewhere, and the "relationship marketing" paradigm should be clear.

"As soon as a company figures out how to delight the customer, it becomes expected all the time, which should be the basis of the relationship."

"Years ago, direct marketers discovered the Pareto Principle: that a disproportionately large amount of profits comes from a disproportionately small amount of customers. Unfortunately, most direct marketers follow it blindly. They take their top performing segments, their most valuable customers, and ... batter them with sales pitches."

"My experience is that there is a very good possibility, depending on the product and category, that the top tier segment may just be giving that marketer just about all the business they have, and there is little room to buy more. So, they start resenting the sales pitches. Alternatively, the segments at the middle profit level - particularly those customers who the database tells us resemble the top tier, but just don't act like them - are the ones who potentially have more to give. Our agency has found this to be the case in the casino business, for instance."

Mr Dentino says any direct marketer must be aware of the pitfalls and temptations of relationship marketing to avoid "irrelevant communications" which he considers to be about 90 per cent of everything sent out by the sector.

"Today we marketers have unprecedented technology at our disposal to do some pretty sophisticated things regarding targeting, tailoring and interacting with customers. We also have unprecedented psychology at our disposal. Do a keyword search of "direct marketing" on Amazon these days and you'll find more than 400 titles! That's a lot of marketing advice."

"But, in the wrong hands this technology-psychology combination can be lethal to a relationship. The old adage 'a little knowledge is dangerous' applies."