FULL PRICE VS DISCOUNT BUYERSWhat follows is a lightly edited transcript of Episode 4 of the Inevitable Success Podcast with Damian Bergamaschi and special guest Mike Ferranti. How could you use purchase history to better understand your customer base?Today Mike Ferranti walks us through just that with a holistic marketing strategy to maximize both profit margins and profit volume for any business especially retailers. Turning the tide starts with understanding how we the marketer can have a material impact on profit margins if we tailor our approach to both full-price and discount buyers respectively. As a bonus, we will also share a simple winning email tactic that maximizes the value of your best customer and by the way, most marketers are not doing this.“The reason we had you on today is that we read your recent article named ‘Full priced customers, How to get and keep them‘ and wanted to go deeper on that topic. Can you share with us why you went there?”Like the answer to many questions, it starts with customers. Going back to the recession, which I guess we bottomed in around 2009 retailers were under tremendous pressure. And so, what was their highest performing Channel? What was the vehicle that was easiest to access revenue through? Of course, it’s e-mail right. Low cost, reasonably good impact, good response, and when you send enough of it eventually your response rates will start to dial down. Now we saw some similarities in the use of direct mail but of course, it’s a much higher cost medium. Brands were looking to get more response and times were tough so what did they do? Well it’s simple they discounted and they discounted and they discounted and they discounted. The upshot of that is kind of what you might expect really, that becomes habit forming that becomes an expectation and once an individual is expecting the discount then there’s a behavior that is very measurable and the results will make most retailers very uncomfortable when they have the resolution to see it. And that is the consumer starts to wait and defer purchasing until the discount comes.“What are ways that they could know that it’s happening, that they can measure it. You know you mentioned the results.”The first dichotomy that you look at is who are the customers that bought a discount? Who are the customers that bought at full price? So, one of the things we were always surprised to see is the number of brands that didn’t have dexterity with their customer data to answer that question at any point in time. You know one size fits all or batch and blast is still the predominant form of outbound marketing even today. Why? It’s easy.That’s the biggest thing, it’s easy number one and number two when the costs of the campaign are so low an email is the primary culprit here.It’s not email that’s the culprit it’s the marketer’s decision making based on resources they have, timing etc. But when they make that decision to just batch and blast and not really discern between those two and to be fair that’s usually driven by the fact that the level of effort to get that information would be significant for many brands. And so, I might not have been so surprised when you know a 50 million dollar brands struggled to get that answer and execute accordingly. You have conversations with executives at 50 billion dollar businesses and some of them say the same thing. That’s really the driver it’s you know the perceived impact in the moment is always quite low the pressure to act and drive that sale is always high.