The lists are used in conjuction with statistical and mathematical techniques to identify group of prospects or individual prospects based on their psychographics, demographics and/or behavioural characteristics such as purchase histories.
Direct marketers use list segmentation to select those people from whom they expect response rates greater than that from the population in general.
List segmentation can also be used to split a list file into several smaller homogenous files, where a firm mails only to individuals in those smaller files because they are expected to ba profitable.
The more a list is refined, the higher the response rate a firm will get to a given campaign. Direct marketers mail or telephone the names expected to be most productive first and move down the list until the incremental response rate is equal to the break-even response rate.
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