Conventional market segmentation calls for the classification of customers into separate groups based on common needs and demographics. The theory goes that promotional messages and the media channels that deliver them can then be tailored to best reach each distinct group. While there is nothing inherently wrong with this widely-used approach, it may not be the best strategy to use in all situations.

One-to-one (OTO) marketing offers marketers the opportunity to communicate on a more effective individual level, leveraging available data about each customer’s product expectations and personal characteristics. Considering the fact that some media experts have estimated that today’s consumer is bombarded with up to 30,000 commercial messages each day, any strategy that offers marketers the hope of rising above the clutter is worthy of consideration.

A properly implemented OTO strategy offers a number of important benefits such as:

• Increased per-customer sales.
• Strengthening customer loyalty.
• Reducing customer churn rate.
• Reducing sales costs.
• Receiving valuable product feedback.

One-to-One Marketing Basics
OTO marketing, sometimes referred to as relationship marketing or customer relationship management, is a systemized approach that identifies and tracks customers, engages with them on an individual basis, and presents a customized product solution that meets or exceeds each customer’s needs and expectations.

The most logical place to start is with your most valuable customers. As you become more knowledgeable about your customer’s needs, you can customize existing products or even create new ones that fill those needs. Over time, you continue to improve your ability to deliver the precise solution that solves customer problems and enhances their ability to succeed in the marketplace. Eventually you reach the point where your company has become an indispensable asset to your customers.

Your OTO marketing program may be started with a limited effort that focuses on one or two key areas such as your call center or website traffic. Depending on company size and available resources, you may have the ability to implement a more ambitious company-wide OTO solution. Whichever option you choose, a solid blueprint that includes actionable activities and assessments will help keep your OTO marketing program on track.

Step One: Identify Your Customers
Your OTO marketing program requires as much information about your customers as possible, including details of their needs, preferences, and habits. This information goes beyond a one-time questionnaire that merely gives you a snapshot in time. You need to continuously refresh your files with updated information about your customer’s needs and experiences with your company.

Step Two: Differentiate Among Your Customers
After your customers have been identified, you need to categorize them according to their value to your company and to their individual needs. This process will enable you to focus your attention on gaining the most traction with your most valuable customers as well as guide you in selecting the most appropriate strategy to use.

Step Three: Establish Effective Customer Interaction Procedures
Automated systems that can replace or at least supplement more costly labor-intensive solutions should be implemented as long as the quality of your customer interaction process is maintained. The effectiveness of your customer interaction is dependent on the quality of the information you collect as it relates to your customer’s changing needs and expectations. Your interaction process should provide a seamless bridge that allows for each new conversation to pick up at the exact point where the previous one left off.

Step Four: Customize Your Company’s Behavior to Meet Customer Needs
The ultimate success of your OTO marketing program is dependent on your ability to tailor the customer experience to meet individual needs. This could entail anything from a product or service customization to a personalized invoicing procedure. Whatever it takes, your company needs to become flexible enough to adapt itself to meet whatever customer expectations may arise.