I hope that this newsletter finds you all in good spirits as we get deeper into the fourth quarter. This month, I wanted to share some thoughts with you on the importance of IT in marketing initiatives. Also, eRichards has announced a new Vice President of Business Development and I invite you to read a short introduction on his background below.

Keep in mind there is still a week left of Breast Cancer Awareness Month. Best wishes for a great Halloween!

Regards,

Doreen Gebbia

Integrating IT, CRM, and CLV
To break down the acronyms: Is your IT system helping your Customer Relationship Management program in ensuring the best Customer Lifetime Value possible?

Marketing is usually the more creative branch of a business: colorful graphics, catchy slogans, and attention grabbing background noise. However, recent client needs have drawn our attention here at eRichards to the equal marketing importance of keeping a business’s marketing strategies in line with their IT systems.

Imagine this scenario: You are a frequent traveler. You fly on a particular airline ten times each year for about $300 each flight ($3,000 per year). On your tenth flight one year, you find yourself upgraded to first class. Because of the frequency of your flights, the airline considers you a valuable customer. In the plush seat next to yours is a customer who flies five times each year, yet flies first class each time for $1,500 each flight ($7,500). This first class flier has never had an upgrade or been appreciated in any way by the airline – aside from the expensive service that he is paying dearly for (2.5 times more than you, to be blatant).

Now, the airline considered you a more valuable customer and rewarded you as such, but who is really giving them more business? Which customer has a better lifetime value for the airline? Yet, who is being rewarded?

The studies and research of Dr. V. Kumar, highly respected Chairman and CEO of IMC International and ING Chair Professor at UConn, shine a stimulating light on this topic. Dr. Kumar would stress the fact that this airline has no clue who their most valued customers are, the customers who should be rewarded. He would say that the most important aspect of marketing to the right people is obtained by focusing on the “customer lifetime value.” This means making loyal customers profitable customers, making profitable customers loyal customers, and targeting and going after the most profitable prospects in marketing strategies.

But the idea has to go even further than that. A company has to realize the importance in that data and invest in acquiring it, retaining and updating it, and making sure it is accurate. The following is an outline that eRichards has pulled from various sources about the best way to combine marketing and IT expertise to create a system that focuses on customers and their needs.

• Find out where and who your most profitable customers are. This means tracking buying habits, noticing preferences, and obtaining some personal information.
• Find out what your level of repeat purchases is.
• Realize the importance of keeping your data clean – there are numerous studies out there that prove billions of dollars are being wasted due to poor data. An IT system needs to be able to accommodate this. Knowing where your best data is located and what it consists of is more than half the battle here.
• Don’t bother with what is not of use to you: You do not want useless facts on your customer, so don’t waste their time. Make it convenient for them to help you serve them better.
• Find out when and who to reward by closely analyzing your customers. Are you rewarding your most profitable customers the most? Are they indeed your most loyal customer group? If not, this group needs to be clearly defined.
• Figure out a way to get accurate profiles of your customers and continue to update and acquire more of them. Group these customers into segments and develop cost effective strategies for each of them.
• Know customer lifetime value so that you have an idea of what you are keeping by marketing to each group alone.
• Ensure that your customer profiling is extremely focused so that it is manageable.

These tidbits grace the tip of the iceberg when it comes to finding out any given company’s best strategy and format. Feel free to contact eRichards to further discuss what your business is currently doing and what it can do better.

*Dr. V. Kumar is the Chairman and CEO of IMC International as well as the ING Chair Professor of Marketing, and Executive Director, ING Center for Financial Services in the School of Business, University of Connecticut. His website can be found at:
www.drvkumar.com and www.imcinternational.com

New VP of Business Development
eRichards proudly announces Jospeh P. Cea as newly appointed Vice President of Business Development

Mr. Cea has over 35 years of strong and diverse experience as a Senior Sales, Marketing and Management Executive with extensive knowledge of all facets of sales, marketing, program development and strategic planning within the IT industry.

Joe spent the first 20 years of his career with Avon, a Fortune 500 company culminating with responsibility for acquisition of Hardware and Software worldwide. His last 13 years were spent as a Senior executive for the Adecco Corporation the world's largest staffing company. The eRichards management team is very excited about having Joe on board.

Interesting Reads
Great books for the business world

• The Ice Cream Maker, by Subir Chowdhury
• The Resilient Enterprise, by Yossi Sheffi
• When Generations Collide, by David Stillman and Lynne Lancaster
• Copy This!, by Paul Orfalea and Ann Marsh

Health Note
The Importance of Drinking Enough Water

To remind everyone of how much water is needed to keep us healthy, even if the weather is cooling off.

• One glass of water shuts down midnight hunger pangs for almost 100% of the dieters studied in a University study.
• Lack of water is the #1 trigger of daytime fatigue.
• Preliminary research indicates that 8-10 glasses of water a day could significantly ease back and joint pain for up to 80% of sufferers.
• A mere 2% drop in body water can trigger fuzzy short-term memory, trouble with basic math, and difficulty focusing on the computer screen.
• Drinking 5 glasses of water daily decreases the risk of colon cancer by 45%, plus it can slash the risk of breast cancer by 79%, and one is 50% less likely to develop bladder cancer.