Database Marketing - Definition & Example
What is Database Marketing?
Database marketing involves the use of statistical tools to customer databases to identify customers who can be targeted through different means of communication for targeting purposes. Database marketing evolved from direct marketing, where a large number of people where personally contacted for the purpose of promoting a product or service.
Companies carry out extensive analysis on customer databases to understand their behavior and try to provide specialized offerings to consumers. Softwares are used to build customer profiles based on demographic, geographical and personal characteristics and use this information to target marketing activities with improved accuracy. Database marketing has over the years become an integral part of marketing as it not only helps in identifying the right set of customers but also helps companies target them more efficiently.
Advantages of Database Marketing
One of the important benefits of database marketing include higher profitability of the campaign – because this helps companies to target their campaigns better and hence results in increased sales. Also, database marketing helps to improve communication with customers. Sustained communication with customers will also help to obtain information from customers about product improvements and help towards new product development as well.
Examples of Database Marketing
Some of the companies which have used database marketing successfully include:
1. Avis Car rental: for identifying customers for their summer car rentals
2. United Artists : scans loyalty cards to record customer’s movie going habits
Hence, this concludes the definition of Database Marketing along with its overview.
This article has been researched & authored by the Business Concepts Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.
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