• Major Australian Retailer
• Single club database of over 500,000 customers receiving direct mail regularly
• Provide a range of different products that suit different stages of life
• Main customer base is young families

• A young single, expecting mother and retiree sent the same type of communication/offer
• Specifically households with babies vs. teenagers not segmented
• The database not used to help the organisation better understand their customers

• Customers segmented using their previous spending patterns (RFM analysis)
• Outcomes used to predict who would respond to a direct marketing piece
• The potential annual savings of not writing to those who wouldn’t respond was $1 per club member
• Segmentation tested against the complete mail out and found to have high accuracy
• By comparing RFM analysis outcomes and running test communication pieces it is possible to make communication highly effective and relevant to the customer by both understanding what type of person they are and where they are in their spending cycle
• People with changing needs identified and communication adjusted accordingly
• The results used to analyse the profitability of each of 200 houses across Victoria
• The spend compared to total sector spend per 200 houses to allow competitor analysis and better understand market penetration
• The profit per communication piece per 200 houses was calculated to fine tune general mail drops and growth areas for NEW customers

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