Catalogue Masterclass (parts 3&4) delivered by Martin Harvey and Mel Henson at ECMOD, Olympia on 17th September 2013. For more information contact martinharvey@btconnect.com or mel@wordsthatsell.co.uk.

1. The Catalogue Masterclass
… the Second Half

2. Customer File Analysis
• Essential Analysis
• Data Hygiene
• RFM
• Statistical Analysis
• Importance of Seasonality and Products
• Segmentation and Mailing Selection
• Mailing Plan and Forecasts
• Segmentation / Mailing Pack Allocation
• The Value of Data Cooperatives
• Lifestyle Profiling
• Data Appending
• Prospect / Single Buyer / Inactive Modelling

3. Data Hygiene...
…. Improve ROI, Increase Profit
• Address Correction
• Salutation Optimisation
• Internal Duplication
• Individuals – Households
• Lower Mailing Costs
• Higher Response Rates
AND…
• Delight Customers

4. Address Cleaning and Salutations
Over
40% No
Titles !
BUT… 97% of Titles
Discoverable !

5. Deduplication and Matching … PLUS …
… Goneaways and Deceased
So… 124,400 Records In
MINUS 14, 700 DUDS ( That’s 12% of the Mailing File)

6. How This All Translates In To Profit
Mailing
Qty
Mailing
Cost
Orders Response Net
Margin
/ Order
Dirty File 124,400 £74,600* 12,000 9.7%
Clean File 109,700 £65,800 +
£2,500
extra for
cleaning
12,000 11.4% + £0.44
Clean File
Total
£69,300
TOTAL
SAVING
£5,300 =
7.1%
Response Up By 18%Response Mailing
Down by 12%
Mailed Quantity
Down by 12%
Profit Up By £5K*Mailing Cost @ £600 /’000

7. RFM – Recency, Frequency, Monetary Value
- And the most important = Recency and Frequency
- Make no mistake, Monetary Value is a great discriminator
for refining selections – particularly for marginal mailing
groups
- Monetary Value aids VIP and Loyalty Programmes too

8. RFM – Recency, Frequency, Monetary Value
- And the most important = Recency and Frequency
- Make no mistake, Monetary Value is a great discriminator for
refining selections – particularly for marginal mailing groups
- Monetary Value aids VIP and Loyalty Programmes too
Then Start to Add Other Variables to Models – But WHICH?
- Intuitive Analysis
- Product Group
- Seasonality
- Single Buyer Catalogue v Insert v Web
- Value of Last / First Order
- Email v Non-Email Subscribers
- CHAID – Easily Understood By Non- Statisticians
- Propensity Scoring / Modelling and Logistic Regression – Leave it
to Experts

9. The RFM Analysis Summary …
…Where We Want to End Up
MAILING March 2013 - My Catalogue CONVERSION MATRIX
Last Total Number of Orders >>>>>
Ordered Total >5 5 4 3 2 1
Q1,2013 11.9% 20.3% 13.7% 7.1% 7.8% 8.5% 2.4%
Q4,2012 12.3% 22.5% 10.8% 10.4% 6.9% 5.0% 4.9%
Q3,2012 9.6% 14.6% 6.7% 9.7% 5.7% 6.7% 3.0%
Q2,2012 11.8% 16.2% 12.4% 9.5% 10.5% 8.5% 7.3%
Q1,2012 11.8% 13.7% 10.6% 10.9% 9.3% 12.2% 5.9%
Q4,2011 4.3% 5.2% 8.4% 9.8% 10.3% 2.2% 1.7%
Q3,2011 1.7% 6.7% 6.0% 6.2% 3.8% 2.6% 1.0%
Q2,2011 1.7% 7.3% 13.9% 3.0% 5.0% 1.7% 1.4%
Q1,2011 3.1% 14.9% 2.0% 2.1% 2.2% 4.2% 2.3%
Q4,2010 2.5% 3.6% ??? 2.0% 3.8% 2.2% 1.6%
Q3,2010 1.8% 5.2% 2.5% 1.2% 2.0% 3.4% 1.4%
Q2,2010 3.0% 2.9% 4.2% 3.3% 6.1% 3.8% 2.7%
Q1,2010 4.1% 7.8% 18.5% 6.0% 3.5% 2.6% 1.6%
Q4,2009 1.3% 2.8% 18.5% ??? 1.2% 1.3% 0.7%
Q3, 2009 1.5% 11.9% ??? ??? 2.2% 2.1% 0.9%
Q2, 2009 1.2% 6.6% 3.2% 1.0% 2.1% 2.2% 1.1%
Mail
???
Do NOT
Mail

10. Standard Recency / Frequency Audit
MAILING March 2013 - My Catalogue
Order
Frequency
Mailing
Volume % Conv Orders Demand
Ave Order
Value
Sale per
Cat
Net Margin /
Order
Previous Buyers
Q4,2011 5+ 2,558 20.3% 519 £20,677 £39.88 £8.08 £16.98
Q3,2011 5+ 3,691 22.5% 830 £34,149 £41.17 £9.25 £17.91
Q2,2011 5+ 9,745 14.6% 1,423 £65,207 £45.83 £6.69 £18.80
Q1,2011 5+ 18,918 16.2% 3,063 £136,270 £44.49 £7.20 £18.54
Q4,2010 5+ 2,376 13.7% 325 £12,915 £39.76 £5.44 £15.49
Q3,2010 5+ 1,905 5.2% 99 £5,011 £50.52 £2.63 £13.74
Q2,2010 5+ 1,365 6.7% 92 £3,717 £40.40 £2.72 £11.30
Q1,2010 5+ 2,500 7.3% 182 £7,140 £39.23 £2.86 £11.37
Q4,2009 5+ 210 14.9% 31 £1,144 £36.65 £5.46 £14.30
Q3, 2009 5+ 751 3.6% 27 £811 £29.81 £1.08 -£1.67
Q2, 2009 5+ 232 5.2% 12 £298 £24.84 £1.28 £0.82
Q1, 2009 5+ 4,912 2.9% 140 £4,711 £33.65 £0.96 -£4.23
Q4, 2008 5+ 216 7.8% 17 £548 £32.62 £2.54 £8.59
Q3, 2008 5+ 292 2.8% 8 £508 £62.69 £1.74 £9.74
Q2, 2008 5+ 20 11.9% 2 £49 £20.43 £2.43 £5.17
Q1, 2008 5+ 231 6.6% 15 £548 £35.80 £2.37 £8.83
FREQUENCY TOTAL 49,920 13.6% 6,785 £293,703 £43.29 £5.88 £17.23
Q4,2011 5 551 13.7% 76 £2,238 £29.61 £4.06 £10.43
Q3,2011 5 1,720 10.8% 186 £8,853 £47.60 £5.15 £18.25
Q2,2011 5 1,872 6.7% 126 £5,128 £40.70 £2.74 £11.44
Q1,2011 5 3,826 12.4% 476 £21,647 £45.48 £5.66 £17.92
Q4,2010 5 635 10.6% 67 £3,103 £46.18 £4.89 £17.42
Q3,2010 5 275 8.4% 23 £751 £32.66 £2.73 £9.16
Q2,2010 5 364 6.0% 22 £799 £36.33 £2.20 £8.24
Q1,2010 5 270 13.9% 38 £1,105 £29.30 £4.09 £10.35
Q4,2009 5 335 2.0% 7 £209 £30.74 £0.62 -£14.21
Q3, 2009 5 72 0.0% - £0
Q2, 2009 5 320 2.5% 8 £404 £50.52 £1.26 £1.26
Q1, 2009 5 353 4.2% 15 £1,204 £81.91 £3.41 £26.56
Q4, 2008 5 87 18.5% 16 £666 £41.09 £7.61 £17.31
Q3, 2008 5 13 18.5% 2 £51 £21.18 £3.92 £7.35
Q2, 2008 5 14 0.0% - £0
Q1, 2008 5 66 3.2% 2 £25 £11.85 £0.38 -£12.98
FREQUENCY TOTAL 10,775 9.9% 1,064 £46,183 £43.42 £4.29 £15.63
Q4,2011 4 1,317 7.1% 93 £2,988 £32.12 £2.27 £7.57
Q3,2011 4 1,962 10.4% 204 £7,987 £39.15 £4.07 £13.81
Q2,2011 4 2,368 9.7% 230 £10,136 £44.14 £4.28 £15.89
Q1,2011 4 7,526 9.5% 717 £31,082 £43.36 £4.13 £15.38
Q4,2010 4 571 10.9% 62 £2,621 £42.21 £4.59 £15.58
Q3,2010 4 328 9.8% 32 £783 £24.46 £2.39 £6.08
Q2,2010 4 252 6.2% 16 £695 £44.54 £2.76 £12.59
Q1,2010 4 2,936 3.0% 88 £3,098 £35.05 £1.06 -£2.40
Q4,2009 4 192 2.1% 4 £100 £24.95 £0.52 -£16.33
Q3, 2009 4 800 2.0% 16 £359 £22.46 £0.45 -£18.77
Q2, 2009 4 181 1.2% 2 £37 £17.61 £0.20 -£42.86
Q1, 2009 4 897 3.3% 30 £993 £33.44 £1.11 -£1.40
Q4, 2008 4 20 6.0% 1 £68 £56.90 £3.39 £18.37
Q3, 2008 4 29 0.0% - £0
Q2, 2008 4 49 0.0% - £0
Q1, 2008 4 317 1.0% 3 £138 £44.65 £0.44 -£39.06
FREQUENCY TOTAL 19,744 7.6% 1,498 £61,085 £40.79 £3.09 £12.48
Q4,2011 3 1,503 7.8% 117 £4,279 £36.57 £2.85 £10.58
Q3,2011 3 1,976 6.9% 137 £4,379 £31.92 £2.22 £7.32
Q2,2011 3 5,151 5.7% 291 £11,845 £40.68 £2.30 £9.72
Q1,2011 3 5,988 10.5% 628 £24,837 £39.56 £4.15 £14.06
Q4,2010 3 516 9.3% 48 £1,798 £37.46 £3.48 £12.28
Q3,2010 3 228 10.3% 23 £623 £26.62 £2.73 £7.46
Q2,2010 3 3,283 3.8% 126 £7,295 £57.99 £2.22 £13.34
Q1,2010 3 2,380 5.0% 120 £4,809 £40.07 £2.02 £8.14
Q4,2009 3 1,424 2.2% 32 £953 £29.79 £0.67 -£11.80
Q3, 2009 3 335 3.8% 13 £369 £29.26 £1.10 -£1.33
Q2, 2009 3 671 2.0% 14 £843 £62.43 £1.26 £1.41
Q1, 2009 3 452 6.1% 28 £874 £31.66 £1.93 £6.00
Q4, 2008 3 147 3.5% 5 £216 £42.32 £1.46 £3.82
Q3, 2008 3 181 1.2% 2 £82 £39.22 £0.46 -£32.05
Q2, 2008 3 288 2.2% 6 £164 £26.38 £0.57 -£14.71
Q1, 2008 3 567 2.1% 12 £231 £19.21 £0.41 -£18.74
March 2013 Sample Catalogue Total
Order
Frequency
Mailing
Volume % Conv
Previous Buyers
Q4,2011 5+ 2,558 20.3%
Q3,2011 5+ 3,691 22.5%
Q2,2011 5+ 9,745 14.6%
Q1,2011 5+ 18,918 16.2%
Q4,2010 5+ 2,376 13.7%
Q3,2010 5+ 1,905 5.2%
Q2,2010 5+ 1,365 6.7%
Q1,2010 5+ 2,500 7.3%
Q4,2009 5+ 210 14.9%
Q3, 2009 5+ 751 3.6%
March 2013 Sample Catalogue Total
Recency – Analysed by Quarter or Month
Frequency – Analysed by 1,2,3,4,5,5+
purchases over lifetime OR specified
period (eg 0-12, 0-24, 0-36 months)

11. MAILING March 2013 - My Catalogue
Order
Frequency
Mailing
Volume % Conv Orders Demand
Ave Order
Value
Sale per
Cat
Net Margin /
Order
Previous Buyers
Q4,2011 5+ 2,558 20.3% 519 £20,677 £39.88 £8.08 £16.98
Q3,2011 5+ 3,691 22.5% 830 £34,149 £41.17 £9.25 £17.91
Q2,2011 5+ 9,745 14.6% 1,423 £65,207 £45.83 £6.69 £18.80
Q1,2011 5+ 18,918 16.2% 3,063 £136,270 £44.49 £7.20 £18.54
Q4,2010 5+ 2,376 13.7% 325 £12,915 £39.76 £5.44 £15.49
Q3,2010 5+ 1,905 5.2% 99 £5,011 £50.52 £2.63 £13.74
Q2,2010 5+ 1,365 6.7% 92 £3,717 £40.40 £2.72 £11.30
Q1,2010 5+ 2,500 7.3% 182 £7,140 £39.23 £2.86 £11.37
Q4,2009 5+ 210 14.9% 31 £1,144 £36.65 £5.46 £14.30
Q3, 2009 5+ 751 3.6% 27 £811 £29.81 £1.08 -£1.67
Q2, 2009 5+ 232 5.2% 12 £298 £24.84 £1.28 £0.82
Q1, 2009 5+ 4,912 2.9% 140 £4,711 £33.65 £0.96 -£4.23
Q4, 2008 5+ 216 7.8% 17 £548 £32.62 £2.54 £8.59
Q3, 2008 5+ 292 2.8% 8 £508 £62.69 £1.74 £9.74
Q2, 2008 5+ 20 11.9% 2 £49 £20.43 £2.43 £5.17
Q1, 2008 5+ 231 6.6% 15 £548 £35.80 £2.37 £8.83
FREQUENCY TOTAL 49,920 13.6% 6,785 £293,703 £43.29 £5.88 £17.23
Q4,2011 5 551 13.7% 76 £2,238 £29.61 £4.06 £10.43
Q3,2011 5 1,720 10.8% 186 £8,853 £47.60 £5.15 £18.25
Q2,2011 5 1,872 6.7% 126 £5,128 £40.70 £2.74 £11.44
Q1,2011 5 3,826 12.4% 476 £21,647 £45.48 £5.66 £17.92
Q4,2010 5 635 10.6% 67 £3,103 £46.18 £4.89 £17.42
Q3,2010 5 275 8.4% 23 £751 £32.66 £2.73 £9.16
Q2,2010 5 364 6.0% 22 £799 £36.33 £2.20 £8.24
Q1,2010 5 270 13.9% 38 £1,105 £29.30 £4.09 £10.35
Q4,2009 5 335 2.0% 7 £209 £30.74 £0.62 -£14.21
Q3, 2009 5 72 0.0% - £0
March 2013 Sample Catalogue Total

12. TRACK - Month on Month RFM Movements
MARKETING DASHBOARD - DUMMY FIGURES
MONTH/SEGMENT
TOTAL START
OF MONTH
TOTAL END OF
MONTH %
% TOTAL
DEMAND
TOTAL START
OF MONTH
TOTAL END
OF MONTH %
% TOTAL
DEMAND
January
Multi Active 0-2 77,186 104,123 135% 56% 74,617 63,709 85% 51%
Multi Lapsed 3-4 56,186 42,332 75% 40% 49,827 59,710 120% 35%
Multi Inactive 5-6 25,291 25,722 102% 32% 23,779 23,925 101% 27%
Single Active 0-2 59,511 57,725 97% 56% 62,897 62,376 99% 54%
Single Lapsed 3-4 56,663 53,970 95% 56% 50,630 48,758 96% 42%
Single Inactive 5-6 31,003 35,168 113% 56% 10,856 14,163 130% 45%
Dormant >6 163,785 168,336 103% 30% 203,998 206,692 101% 28%
New buyers 62% 58%
TOTAL 469,625 487,376 104% 55% 476,603 479,334 101% 50%
February
Multi Active 0-2 104,123 77,621 75% 45% 63,709 70,123 110% 67%
Multi Lapsed 3-4 42,332 58,786 139% 50% 59,710 55,516 93% 36%
Multi Inactive 5-6 25,722 26,006 101% 43% 23,925 23,738 99% 31%
Single Active 0-2 57,725 56,734 98% 60% 62,376 60,569 97% 58%
Single Lapsed 3-4 53,970 52,617 97% 63% 48,758 50,559 104% 54%
Single Inactive 5-6 35,168 29,304 83% 61% 14,163 15,234 108% 49%
Dormant >6 168,336 229,779 137% 39% 206,692 227,098 110% 25%
New buyers 63% 58%
TOTAL 487,376 530,847 109% 52% 479,334 502,837 105% 60%
ONLINEONLINE
2013 2012

13. RFM – As a Matter of Course…
… Track Customer Segment Monthly Changes
MARKETING DASHBOARD - DUMMY FIGURES
MONTH/SEGMENT
TOTAL START
OF MONTH
TOTAL END OF
MONTH % BUYERS DEMAND BUYERS DEMAND
% TOTAL
DEMAND
TOTAL START
OF MONTH
TOTAL END
OF MONTH % BU
January
Multi Active 0-2 77,186 104,123 135% 10,261 £613,669 7,676 £341,221 56% 74,617 63,709 85% 1
Multi Lapsed 3-4 56,186 42,332 75% 1,318 £46,881 510 £18,638 40% 49,827 59,710 120%
Multi Inactive 5-6 25,291 25,722 102% 493 £16,369 173 £5,241 32% 23,779 23,925 101%
Single Active 0-2 59,511 57,725 97% 2,698 £96,966 1,448 £54,153 56% 62,897 62,376 99%
Single Lapsed 3-4 56,663 53,970 95% 710 £22,724 389 £12,834 56% 50,630 48,758 96%
Single Inactive 5-6 31,003 35,168 113% 222 £6,898 116 £3,849 56% 10,856 14,163 130%
Dormant >6 163,785 168,336 103% 742 £22,161 215 £6,723 30% 203,998 206,692 101%
New buyers 5,711 £171,270 3,138 £106,078 62%
TOTAL 469,625 487,376 104% 22,155 £996,936 13,665 £548,737 55% 476,603 479,334 101% 2
February
Multi Active 0-2 104,123 77,621 75% 9,849 £393,979 4,480 £178,448 45% 63,709 70,123 110%
Multi Lapsed 3-4 42,332 58,786 139% 998 £34,588 463 £17,243 50% 59,710 55,516 93%
Multi Inactive 5-6 25,722 26,006 101% 388 £12,356 153 £5,309 43% 23,925 23,738 99%
Single Active 0-2 57,725 56,734 98% 2,193 £77,657 1,242 £46,931 60% 62,376 60,569 97%
Single Lapsed 3-4 53,970 52,617 97% 537 £15,749 313 £9,859 63% 48,758 50,559 104%
Single Inactive 5-6 35,168 29,304 83% 217 £5,623 116 £3,407 61% 14,163 15,234 108%
Dormant >6 168,336 229,779 137% 534 £14,437 169 £5,649 39% 206,692 227,098 110%
New buyers 6,559 £175,993 3,316 £110,019 63%
TOTAL 487,376 530,847 109% 21,275 £730,382 10,252 £376,864 52% 479,334 502,837 105% 1
TOTAL ONLINE
2013

14. Constantly Track New Customer Conversion
RANGE 1 - New Customer LTV Trackler - Conversion
2013
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
NEW BUYERS 53,619 14,935 5,818 5,859 35,518 20,880 3,701 5,964 43,087
SAME QUARTER (excl 1st order) 2011 Q1 2011 Q2 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1
2nd Purchasers 3802 1017 395 162 1997 762 266 285 2460
% 2nd Purchasers 7.1% 6.8% 6.8% 2.8% 5.6% 3.6% 7.2% 4.8% 5.7%
1st quarter forllowing acquisition 2011 Q2 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1
2nd Purchasers 2473 523 385 1670 4055 821 353 1705
% 2nd Purchasers 4.6% 3.5% 6.6% 28.5% 11.4% 3.9% 9.5% 28.6%
2nd quarter forllowing acquisition 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1
2nd Purchasers 1344 192 945 235 1363 821 1635
% 2nd Purchasers 2.5% 1.3% 16.3% 4.0% 3.8% 3.9% 44.2%
3rd quarter forllowing acquisition 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1
2nd Purchasers 950 1182 305 259 1985 2011
% 2nd Purchasers 1.8% 7.9% 5.2% 4.4% 5.6% 9.6%
4th quarter forllowing acquisition 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1
2nd Purchasers 8182 827 478 321 4969
% 2nd Purchasers 15.3% 5.5% 8.2% 5.5% 14.0%
5th quarter forllowing acquisition 2012 Q2 2012 Q3 2012 Q4 2013 Q1
2nd Purchasers 1406 295 274 514
% 2nd Purchasers 2.6% 2.0% 4.7% 8.8%
6th quarter forllowing acquisition 2012 Q3 2012 Q4 2013 Q1
2nd Purchasers 507 168 1155
% 2nd Purchasers 0.9% 1.1% 19.9%
7th quarter forllowing acquisition 2012 Q4 2013 Q1
2nd Purchasers 338 25
% 2nd Purchasers 0.6% 0.2%
TOTAL
2nd Purchasers 19,001 4,227 3,937 3,161 14,370 4,415 2,254 1,990 2,460
% 2nd Purchasers 35.4% 28.3% 67.7% 54.0% 40.5% 21.1% 60.9% 33.4% 5.7%
2011 2012

15. Track New Customer Conversion - 2
RANGE 1 - New Customer LTV Trackler - Conversion
Q1 Q2 Q3 Q4 Q1 Q2
NEW BUYERS 53,619 14,935 5,818 5,859 35,518 20,880
SAME QUARTER (excl 1st order) 2011 Q1 2011 Q2 2011 Q3 2011 Q4 2012 Q1 2012 Q2
2nd Purchasers 3802 1017 395 162 1997 762
% 2nd Purchasers 7.1% 6.8% 6.8% 2.8% 5.6% 3.6%
1st quarter following acquisition 2011 Q2 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3
2nd Purchasers 2473 523 385 1670 4055 821
% 2nd Purchasers 4.6% 3.5% 6.6% 28.5% 11.4% 3.9%
2nd quarter following acquisition 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4
2nd Purchasers 1344 192 945 235 1363 821
% 2nd Purchasers 2.5% 1.3% 16.3% 4.0% 3.8% 3.9%
3rd quarter following acquisition 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1
2nd Purchasers 950 1182 305 259 1985 2011
% 2nd Purchasers 1.8% 7.9% 5.2% 4.4% 5.6% 9.6%
4th quarter following acquisition 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1
2nd Purchasers 8182 827 478 321 4969
% 2nd Purchasers 15.3% 5.5% 8.2% 5.5% 14.0%
2011 2012
News Customers
Each Quarter
(or month, etc)
Same Qtr
1 Year Later
New Customer Year on Year Conversion

16. Track New Customer Conversion - 3
RANGE 1 - New Customer LTV Trackler - Conversion
Q1 Q2 Q3 Q4 Q1 Q2 Q3
NEW BUYERS 53,619 14,935 5,818 5,859 35,518 20,880 3,701
SAME QUARTER (excl 1st order) 2011 Q1 2011 Q2 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3
2nd Purchasers 3802 1017 395 162 1997 762 266
% 2nd Purchasers 7.1% 6.8% 6.8% 2.8% 5.6% 3.6% 7.2%
1st quarter following acquisition 2011 Q2 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4
2nd Purchasers 2473 523 385 1670 4055 821 353
% 2nd Purchasers 4.6% 3.5% 6.6% 28.5% 11.4% 3.9% 9.5%
2nd quarter following acquisition 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1
2nd Purchasers 1344 192 945 235 1363 821 1635
% 2nd Purchasers 2.5% 1.3% 16.3% 4.0% 3.8% 3.9% 44.2%
Quarters 3 to 5 NOT SHOWN
6th quarter following acquisition 2012 Q3 2012 Q4 2013 Q1
2nd Purchasers 507 168 1155
% 2nd Purchasers 0.9% 1.1% 19.9%
7th quarter following acquisition 2012 Q4 2013 Q1
2nd Purchasers 338 25
% 2nd Purchasers 0.6% 0.2%
TOTAL
2nd Purchasers 19,001 4,227 3,937 3,161 14,370 4,415 2,254
% 2nd Purchasers 35.4% 28.3% 67.7% 54.0% 40.5% 21.1% 60.9%
2011 2012
New Customer Year on Year Conversion

17. Going Beyond RFM – CHAID
(Chi-square Automatic Interaction Detection or Classification Tree)

18. CHAID Gains Chart
Improving Performance of Marginal Data
Predicted Response / Profit
Gain for Each Segment
(476 = + 376% over average)
100 = Effect of Mailing
All Cells – ie 100% of
AVERAGE (Normal)
Response
This group is expected to
achieve only 31% response
of average for ALL groups.

19. Segmentation – ROI Objectives
Recruitment and Reactivation – At What Cost?
• 1 - Lifetime Value is a Direct Function of Recruitment Cost
• 2 – IF YOU Allow Marketers to Recruit / Reactivate at a Cost
• - That’s What They’ll Do
• 3 – Think CASH MARGIN - AVOID Complex Accounting Concepts
• 4 – Reactivated Customers (Generally) Behave Just Like New
Customers

20. Segmentation – ROI Objectives
Recruitment and Reactivation – At What Cost?

21. Mailing Selections and Segmentation
STEP 1 - File Analysis Leads on to Creating the Mailing Plan
STEP 2 – Sales Forecasts
STEP 3 – Mailing Pack Selection and Source Code Allocation
STEP 4 – Outsourced Marginal Customer Group Optimisation

22. STEP 1 – Historic Analysis Leads and Mailing Plan
Order
Frequency % Conv
Previous Buyers
Q4,2011 4 7.1%
Q3,2011 4 10.4%
Q2,2011 4 9.7%
Q1,2011 4 9.5%
Q4,2010 4 10.9%
Q3,2010 4 9.8%
Q2,2010 4 6.2%
Q1,2010 4 3.0%
Q4,2009 4 2.1%
Q3, 2009 4 2.0%
Q2, 2009 4 1.2%
Q1, 2009 4 3.3%
Q4, 2008 4 6.0%
Q3, 2008 4 0.0%
Q2, 2008 4 0.0%
Q1, 2008 4 1.0%
FREQUENCY TOTAL 7.6%
LAST YEAR'S EQUIVALENT DATA
or AVERAGED DATA
For Each RFM Segment define –
- Conversion Rate
- Forecast £ Order Value
( Use Previous Year’s Equivalent
Data OR Use Averages For
Similar Programmes)
Next ….
Overlay NEW Database Counts
for Each Segment

23. STEP 1 – continued
TODAY'S
COUNTS
QUANTITY
to SELECT FORECAST
Order
Frequency % Conv
DATA
FROM
Mailing
Volume Buyers Orders
Previous Buyers
Q4,2011 4 7.1% Q4,2012 2,372 2,372 168
Q3,2011 4 10.4% Q3,2012 13,472 13,472 1,401
Q2,2011 4 9.7% Q2,2012 4,339 4,339 421
Q1,2011 4 9.5% Q1,2012 16,935 16,935 1,613
Q4,2010 4 10.9% Q4,2011 564 564 61
Q3,2010 4 9.8% Q3,2011 1,136 1,136 111
Q2,2010 4 6.2% Q2,2011 2,143 2,143 133
Q1,2010 4 3.0% Q1,2011 9,158 5,000 151
Q4,2009 4 2.1% Q4,2010 2,376
Q3, 2009 4 2.0% Q3,2010 2,007
Q2, 2009 4 1.2% Q2,2010 2,478
Q1, 2009 4 3.3% Q1,2010 4,153 4,153 138
Q4, 2008 4 6.0% Q4,2009 720 720 43
Q3, 2008 4 0.0% Q3, 2009 -
Q2, 2008 4 0.0% Q2, 2009 -
Q1, 2008 4 1.0% Q1, 2009 2,332
FREQUENCY TOTAL 7.6% 83,341 51,226 4,238
LAST YEAR'S EQUIVALENT DATA
or AVERAGED DATA

24. STEP 2 - Mailing Segment Sales Forecast
TODAY'S
COUNTS
QUANTITY
to SELECT FORECAST
DATA
FROM
Order
Frequency % Conv
Mailing
Volume Buyers Orders
£ Order
Value
Forecast
Sales
Q4,2012 4 7.1% 2,372 2,372 168 £39.88 £6,682
Q3,2012 4 10.4% 13,472 13,472 1,401 £41.17 £57,667
Q2,2012 4 9.7% 4,339 4,339 421 £45.83 £19,284
Q1,2012 4 9.5% 16,935 16,935 1,613 £44.49 £71,753
Q4,2011 4 10.9% 564 564 61 £39.76 £2,440
Q3,2011 4 9.8% 1,136 1,136 111 £50.52 £5,598
Q2,2011 4 6.2% 2,143 2,143 133 £40.40 £5,364
Q1,2011 4 3.0% 9,158 5,000 151 £39.23 £5,906
Q4,2010 4 2.1% 2,376
Q3,2010 4 2.0% 2,007
Q2,2010 4 1.2% 2,478
Q1,2010 4 3.3% 4,153 4,153 138 £33.65 £4,628
Q4,2009 4 6.0% 720 720 43 £32.62 £1,398
Q3, 2009 4 0.0% -
Q2, 2009 4 0.0% -
Q1, 2009 4 1.0% 2,332
TOTAL 4 8.3% 61,854 50,834 4,238 £180,719

25. STEP 3 – Mailing Pack Selection
TODAY'S
COUNTS
QUANTITY
to SELECT
DATA
FROM
Order
Frequency % Conv
Mailing
Volume Buyers Qty Code Qty Code Qty Code Qty Code Qty Code
Q4,2012 4 7.1% 2,372 2,372 2,372 V1
Q3,2012 4 10.4% 13,472 13,472 7,472 V2 2,000 T12 2,000 T22 2,000 C2
Q2,2012 4 9.7% 4,339 4,339 4,339 V3
Q1,2012 4 9.5% 16,935 16,935 7,935 V4 3,000 T14 3,000 T24 3,000 C4
Q4,2011 4 10.9% 564 564 564 L1
Q3,2011 4 9.8% 1,136 1,136 1,136 L2
Q2,2011 4 6.2% 2,143 2,143 2,143 L3
Q1,2011 4 3.0% 9,158 5,000 5,000 L4
Q4,2010 4 2.1% 2,376
Q3,2010 4 2.0% 2,007
Q2,2010 4 1.2% 2,478
Q1,2010 4 3.3% 4,153 4,153 4,153 L5
Q4,2009 4 6.0% 720 720 720 L6
Q3, 2009 4 0.0% -
Q2, 2009 4 0.0% -
Q1, 2009 4 1.0% 2,332
TOTAL 4 8.3% 61,854 50,834 22,118 13,716 5,000 5,000 5,000
Check 50,834
Mailing Pack 1
VIP CUSTOMERS
Mailing Pack 2
LAPSED
CUSTOMERS
Mailing Pack 3
TEST FREE P&p
Mailing Pack 4
TEST £5
LOYALTY
Mailing Pack 1
VIP CUSTOMERS
CONTROL
What makes a
control cell ?

26. STEP 4 – Optimising Marginal Groups…
… using data coops
Experience of One Fashion Brand
•Targetted 3 separate parts of the “fashion brand’s” database
•24+ month buyers
•13+ month enquirers
•“low” score customers – 0-24 month, 1 purchase, low AOV
•Aggregate response
•24+ month buyers: 3.22%
•13+ month enquirers: 0.43%
•“low” score optimisation: 4.93%
• Now Provides approximately 120,000 additional customers to mail
Data Supplied by -

27. CRITIQUES PART 1 – ORDERING A CATALOGUE

28. RNLI
Very quick and easy....

29. With branded follow up email

30. DOGALOGUE
• Good position but
a little small
• Like the bone
• And offer of
braille, print or CD

31. Stronger links from charity site?

32. SEASALT
•Hard to find
•But easy once we did

33. DANBURY MINT
• Request button was hidden
(bottom left)
• But easy to order
• Nice thank you message

34. Nice on-screen message
But the email jarred....

35. ACTION ON HEARING LOSS
Tiny line at the bottom of the
page

36. Confused thank you message

37. HOTEL CHOCOLAT
Hidden – but easy to order once
found...

38. BAKER ROSS
• Good to ask for
relevant information
(Who are you ordering
for?)

39. But unfriendly error messages...

40. FORCE4 CHANDLERY
• Good home page promotion

41. It autofilled, then told me off for its own
mistake....

42. HOUSE OF BATH
• Or House of Horrors?
• 6 unfriendly steps for a simple
catalogue request.

51. Unfriendly emails too...

52. LEGO
• Another click-intensive
catalogue request
process

53. You want my date of birth?

54. • But Lego, I want a
catalogue, not your
emails....

56. At last

57. TTS

58. SAVILLE ROW COMPANY

59. I have to wait a month!!!!

60. • In a nutshell the Lifetime Value of a customer is…
• The average purchase value, multiplied by the number of times they
buy from
• you in a year, multiplied by the number of years they remain your
customer.
• Once you know this...
• …you’ll know what you can afford to spend in order to get new
customers.

61. Catalogue Critiques

62. LAKELAND
Excellent envelope
Selling from the start....
...whichever side it lands on
the mat

63. LAKELAND
• Subheads to help differentiate ie:
• Light weight, value, deluxe feature
packed
• Or to flag benefits eg:
• Protect your china

64. LAKELAND
• Separate leaflet – got rather lost
in the pack
• Refer to it in the letter?
• Is it a welcome first time offer?
Or for everyone?
• Make threshold line larger and
word as:
WHEN YOU SPEND £60 or more
•Add web address

65. SEASALT
• Full of charm – but frightened to
sell
• Needs web and phone on the
front. These say ‘Here are things
for sale’ rather than ‘Here are
things to look at

66. SEASALT
• P2 - Doesn’t say strongly
enough that ALL Seasalt coats
are waterproof.
• Too much irrelevant detail – eg
Different weights some with
quilted lining some without
• Guarantee?
• P3 wasted opportunity to sell

67. • Possibly put price last
• Sidebar looks like navigation not
product name
• Indoor photograph – so needs to
communicate ‘Waterproof’.
• Use copy to explain things that are
not obvious from the photo such as
warmth, weight, feel
• ‘Details’ list is a long block of text.
Possibly make it more scannable with
sub-heads, different fonts or different
bullet styles eg: one for style details
another for functional details,
another for care & fabric content
details
• Phone and web address?
SEASALT

68. SEASALT
• Waste of prime selling space in
centre pages
• Catalogue too small to need an
index
• Might be useful as a comparison
chart, but needs more info for
each coat

69. HOTEL CHOCOLAT
• 3 arrived in one day
• Plain envelope, no return
address, no letter
• Excellent branding
• Beautiful product shots –
but no enjoyment shots

70. HOTEL CHOCOLAT
• Happiness Guarantee – don’t
hide it away
• Delivery information (how
protected in transit?
• Confusing delivery costs
• Why 5% and not free delivery?

71. HOTEL CHOCOLAT
• Chic and beautiful on gorgeous
paper
– but hard to read
• To drive traffic to website needs
stronger call to action

72. ACTION ON HEARING LOSS
• Expensive flap

73. ACTION ON HEARING LOSS
• Icons better below not above product
• Bestseller should be a flash not an
icon
• Smaller text – larger photos
• Try different fonts, sizes, tints
• One column of copy if poss

74. ACTION ON HEARING LOSS
• Consider sub-heads with
benefits eg:
• Get alerts when your phone rings
• Know when your baby is crying
• Or to differentiate similar
products
• Start copy with active words
rather than ‘The’ or ‘This’.

75. LEGO
• Strong superman image –but
brave to go for an all-illustration
cover with no photo of a
smiling, engrossed child
• FREE DELIVERY and FREE GIFT –
somewhat lost on a busy cover
• Plain graphics like on page 2
would help it stand out
• Ordering info could also be
stronger

76. LEGO
• VIP programme – a huge missed
opportunity
• White text on blue impossible to
read

77. LEGO
• Improve signposting of age range
• Put no of pieces at the bottom near
price – to add value to the cost.
• Place choking disclaimer in a less
prominent position. Do you need
the warning triangle?
• Beef up footers – it’s hard to find
web address
• Remind of free delivery, with a
strong, plain graphic.

78. DIABETES UK
• Aim for one big picture not lots
of little ones
• Font sizes hierarchy:
Autumn/Winter not important
but web address is.
• Red colour doesn’t reflect the
brand

79. DIABETES UK
• Expensive order form
• Folded
• Perforated
• Gummed
• Lots of space
• Write in a suggested donation
amount

80. DIABETES UK
• Lots of wasted space
in prime hotspot
• Hard to read
welcome letter

81. ACTION ON HEARING LOSS
• Expensive flap

82. ACTION ON HEARING LOSS
• Icons better below not above product
• Bestseller should be a flash not an
icon
• Smaller text – larger photos
• Try different fonts, sizes, tints
• One column of copy if poss

83. ACTION ON HEARING LOSS
• Consider sub-heads with
benefits eg:
• Get alerts when your phone rings
• Know when your baby is crying
• Or to differentiate similar
products
• Start copy with active words
rather than ‘The’ or ‘This’.

84. LEGO
• Strong superman image –but
brave to go for an all-illustration
cover with no photo of a
smiling, engrossed child
• FREE DELIVERY and FREE GIFT –
somewhat lost on a busy cover
• Plain graphics like on page 2
would help it stand out
• Ordering info could also be
stronger

85. LEGO
• VIP programme – a huge missed
opportunity
• White text on blue impossible to
read

86. LEGO
• Improve signposting of age range
• Put no of pieces at the bottom near
price – to add value to the cost.
• Place choking disclaimer in a less
prominent position. Do you need
the warning triangle?
• Beef up footers – it’s hard to find
web address
• Remind of free delivery, with a
strong, plain graphic.

87. DIABETES UK
• Aim for one big picture not lots
of little ones
• Font sizes hierarchy:
Autumn/Winter not important
but web address is.
• Red colour doesn’t reflect the
brand

88. DIABETES UK
• Expensive order form
• Folded
• Perforated
• Gummed
• Lots of space
• Write in a suggested donation
amount

89. DIABETES UK
• Lots of wasted space
in prime hotspot
• Hard to read
welcome letter

90. FORCE 4 CHANDLERY
• Keep web and phone together
• Don’t need towns on the front
cover
• Strapline unique to the brand

91. FORCE 4 CHANDLERY
• Product categories at top, order
information at bottom
• Repeating product name top
and bottom wastes space.
• Dark blue product name floats –
doesn’t relate to product.
• Generally more personality

92. TTS
• Ok – So everything was in a
thick polylope – but this is a
multi catalogue company.
• 156 page Specialist Teachers’
Maths Catalogue
• Perfect Bound covered Annual
Reference
• Robust UV varnished cover

93. TTS
• Personalised Letter
• Call to action flyer – reverse was
plain … when you have so much
to say
• £25 off £100 order on flyer
• FREE delivery too in letter – but
on flyer

94. TTS
• Clear Signposting on
page 2 and 3
• Perhaps a Guarantee
• Classic position for
contents

95. TTS
• Clear section planning through
use of tints
• Each section with its own
contents listing
• It’s hard to fault this catalogue

96. DOGALOGUE
• Sticker on polylope – no return
address
• Size & 40 pages = expensive
• Good to have Free p&p on front cover
– but place bottom right
• Mention Free gift too
• Make gifts time limited?
• Insets good – but add in page
numbers

97. DOGALOGUE
• P2 – summarise order
information to make shorter
• Add short contents

98. DOGALOGUE
• Best-sellers label
• OUR BESTSELLING CARDS
• Bows– photograph them out of the
pack
• FREE GIFT (worth £2.99) when you
buy 4 packs of cards
• Blank parcel graphic wastes a valuable
hotspot

99. DOGALOGUE
Introduce hero shots?

100. BAKER ROSS
• Arrived within 1 day
• Only one to arrive in less than 7
days
• Nice envelope

101. BAKER ROSS
• Good hardworking catalogue
• Make better use of hot spot
bottom right

102. BAKER ROSS
• Editorial – consider making
separate leaflet – or offer as a
free gift with purchase
• Also use as web pages or
downloads on website
• Toys – consider renaming
stocking fillers

103. BAKER ROSS
• Footers – alternate with web
and phone on right hand page
• Buy with confidence – not Buy
in confidence

104. DANBURY MINT
• Arrived in plain C4 envelope
(catalogue 165 x 240 format).
• Re-writing the letter copuld do
wonders
• Inviting cover – good shop
window
• Only Martin received a
catalogue
• Classic design for this older
collectors’ audience… BUT how
does the Brand move on

105. DANBURY MINT
• Great Use of Panels to Highlight
Products
• Classic design for this older
collectors’ audience… BUT how
does the Brand move on
• Excellent order form, with inline
finished envelope

106. HOUSE OF BATH
• Great cover – fresh, inviting
• Large lifestyle photo
• Headline contains brand
proposition, benefit and
seasonality
• Clear offer bottom right
• Prominent web & phone

107. HOUSE OF BATH
Good letter
Well presented
Smart use of paper
Mrs Mel Henson?

108. HOUSE OF BATH
Second letter – different
signature?
Icons don’t need to be shown –
or link to offer eg: 10% OFF – on
top of these great offers
Guarantee looks like legal
disclaimer, not a trusted benefit

109. HOUSE OF BATH
Good use of paper – lasered address
? Die cut window in catalogue?
• Phone number & web address
should be larger
? Needs a line for customer to deduct
10%

110. HOUSE OF BATH
• Tint panels easy to navigate
• Well designed ‘New’ and ‘Great
Value’ Flashes
• Call-outs
• Insets
• Bullets
• HYS (Have you seen?)

111. HOUSE OF BATH
Great sale pricing
layout
• Time consuming to
work out
• Fiddly to layout
• A pain to proof read
• But so effective

112. Questions?