Closed Loop Marketing multiplies ROI

 Email Article |  Twitter |  Facebook |  digg it |   StumbleUpon |   LinkedIn |   Technorati 

The term closed-loop marketing has been around for decades. The huge increase in marketing channels adds complexity to the challenge of delivering relevant messages to customers and prospects. Put very simply Closed-loop Marketing (CLM) is interactive marketing where customer responses and behaviour are employed to direct and refine marketing strategy and tactics.

There is a "closed loop" where collected customer data and behaviour is used to build a profile of customers - profiles that provide the basis for further marketing initiatives. Typically, the recipient profile is adjusted by responses to the campaign and the campaign is adjusted to the recipient profile - there is a feedback loop.

Companies are constantly creating interactions with their customers. A lot of these interactions are outbound interactions initiated by Marketing. A Retailer may advertise an end of the year sale in media and also use some other channels like email and direct mail to invite specific segments of customers to their stores. Marketers do not need sophisticated technology to start measuring the results of each marketing action. Yes there would be no perfect answers. But the important thing is to start creating this “accountable marketing” philosophy.

Increasingly, organizations are using customer data and behavior to direct and refine marketing strategy and tactics, creating a closed-loop system between their marketing message and their customers that continuously evolves.

According to a recent report from Aberdeen, "The CMO Strategic Agenda: Automating Closed-Loop Marketing," 88 percent of best-in-class companies have adopted this full-circle or "closed-loop" marketing approach, and they have procured technology to help automate the process.

You can read about this here:Automating Closed Loop Marketing

 However we believe that Closed loop marketing is wrongly sold as a technology problem. Many IT companies almost seem to be sayings that automate marketing and you will accomplish Closed loop marketing-almost magically. Closed loop marketing is also wrongly perceived to be purely an Online kind of approach where you integrate all aspects of your internet marketing into a closed loop.

The real problem is that Marketers need to examine if they are process and ROI focussed. Do they measure how each leg of their marketing campaign is delivering value ? How does the sms,internet, DM and Advertising medium work together? Are you attracting a different profile of customers from these different channels? Are consumers primarily multi channel? Are you using Analytics to figure out the ROI on your Marketing investments.

Our perspective at Cequity is that companies must build appropriate marketing processes ahead of automation-only then can Marketing automation give you results.