Database marketing allows managers to use customer information to their -- and the mall stores' -- full promotional advantage.
With database marketing, the days of inexact intercept surveys and blind direct mailings are numbered. Center managers can use customer-retaining programs to retrieve valuable spending and demographic data, then use that information to focus their promotional efforts. In turn, managers can help their merchants unlock the mysteries of the often unpredictable practice of shopping.
At North County Fair Mall in Escondido, Calif., marketing director Roger Brazil knows where mall patrons shop, what they buy and how much they spend. With the push of a button, Brazil can generate an up-to-the-minute report providing those details -- and much more.
With data in hand, the management of North County Fair Mall, owned by San Diego-based TrizecHahn Centers, can implement incentive programs designed to introduce new products, stimulate mail order catalog sales or recognize special dates such as birthdays and anniversaries. Weekly meetings are held with mall merchants to design individual promotions; stores can use the information to solicit their most frequent customers.
"If I'm a store manager and I want to reach customers who have spent $1,000 over the past three months, I can go into the database and print out a list," Brazil explains. "Last week, we had a call from Eddie Bauer. They were planning an upcoming mailing for a friends and family discount morning and wanted to contact their best customers. We provided them with the names."
Stretching marketing dollars In a world of shrinking marketing budgets, increased competition from other centers and the impact of the Internet, the need for "smart marketing" is at an all-time high. Database marketing is playing an increasingly larger role bringing managers the information they need to target their most profitable markets.
For example, shopping centers, malls and retailers create mailings based on customer shopping patterns kept in a searchable database. Direct mailings can be aimed at a targeted audience rather than being sent in a blanket mailing.
"Using our database is very cost-effective," says Joe Koechel, vice president and regional stores director for Solomon Pond Mall in Marlborough, Mass. The center is owned by Newton, Mass.-based WellsPark Group.
"It's fairly inexpensive to tap into it, and you're not just [blindly purchasing] a mailing list from a credit card company without knowing if they shop at Solomon Pond. With our database, we already know they shop with us," he says.
North County Fair Mall also puts database marketing to good use. By specifically targeting a customer base -- and providing incentives for patrons to provide personal data -- the center's management can assist in finding the best customers for its merchants.
"Database marketing allows merchants to customize their message, so they don't waste marketing dollars," Brazil says, adding that giving direction to a marketing message allows retailers to better flex their marketing muscle. "If retailers have a limited budget, they can now target a specific mailing to their best customers rather than sending a mailing to just one zip code in one area."
Angie Epps, regional marketing director for Indianapolis-based Simon DeBartolo Group, agrees with Brazil. "Database information allows us to focus our marketing efforts," she says. "Marketing strategies are targeted to communicate one-to-one to the most productive shopper segments."
"Hey, big spenders..." In many cases, centers' marketing or customer retention programs have built-in demographic data retrieval which can help expand the information kept in the centers' databases. Montebello Town Center, owned by Newport Beach, Calif.-based Donahue Schriber, created the Shop & Win Club, an incentive program that helps track the mall's most prized customers while providing them contest entries, coupons and other value-added services.
As a result, Montebello Town Center accomplishes a number of tasks, including encouraging repeat shopping; rewarding those core shoppers with prizes and other incentives; and promoting key retail periods. Moreover, mall management can acquire highly detailed research information and track spending behavior of the center's biggest spenders.
Under Simon DeBartolo's MALL-PeRKS program, shoppers who participate are asked their name, mailing address, as well as demographic information such as income and date of birth, says Epps. She says the data gathered -- which also includes stores shopped, purchase amounts, and date and time of purchase -- is particularly useful for retailers.
"It's good information for retailers who want to know how much a customer [spent in their stores]," she says, adding that good information will cause retailers to ask the correct questions. "If a shopper spent $10 in one store and on the same trip went to a competing store and spent $50, as a retailer, I want to know why I only got 10 of [their dollars]."
Members of the MALLPeRKS program present their card and sales receipts to the mall customer service office, where the data is then entered. "Prior to MALLPeRKS, we collected information from customers by surveying them on the telephone and in the mall," says Epps. The practice proved inexact, however, because shoppers either could not remember their purchases or were reluctant to participate.
Koechel of Solomon Pond Mall says an application for the Family Club -- the members of which receive advance notice of sales as well as store coupons -- requests information such as names of children, birthdays, income level and favorite leisure activities.
"On their birthdays, kids 12 and under receive a $5 gift certificate for use in the mall," he says. "We have a very active database, and tenants use it for mailings. Many stores may not have good databases, while some have good ones but want to add more names."
Santa Rosa, Calif.-based Corporate Property Investors (CPI) maintains a database of more than 1 million names for its 17 U.S. shopping centers. The information contained in the data-base includes customer names, addresses and ages, as well as promotional programs in which the customers have participated.
"We have developed our database through the collection of customer [response data] from center programs and services," explains Judy Gray, CPI's regional marketing manager. "We reach the customers in our database through postcard mailings, newsletters, seasonal merchandise brochures and incentive-based direct mail offers."
In the future, says Gray, CPI would like database access to in-store sales transaction data to further understand its patrons' shopping patterns. The greatest benefit from database implementation, she says, "would come from linking center merchants with the center's [centralized] database source."
The Shopping Advantage Program at North County Fair already does that, with the ability to report where and how much a customer has spent. Reports also can be generated to show one-time active customers who have not returned to the mall in some time.
"Our program uses an actual credit card that customers receive with a magnetic strip on back that keeps track of their purchases," Brazil says. "We can record purchases at each store that participates. The information is downloaded each evening to a central computer in the center's marketing department."
Above all, says Brazil, managers and merchants must mine the retail fields together. "Store involvement is the key," he says. "We provide the data free to the merchants, and we'd like to see more merchants getting involved."
Not for everyone? Epps of Simon DeBartolo says the adjunct marketing programs that feed the databases are still maturing. "I'd like to know about stores visited but also about where purchases were not made," she says.
"This program is in its infancy and is very much a customer retention program," she adds. "But at some point down the road, I'd like to see [that additional] information."
"It's not for us," says Anne Lipscomb, group vice president of marketing at The Mills Corp., Arlington, Va. She says that, because the typical Mills center draws from a wider area radius than the standard shopping center, the company looks to means other than database marketing to promote its centers.
"With limited resources, we feel very strongly that broadcast TV and radio are the best ways for us to advertise. Maybe we'll look at [database marketing] again in a couple of years," she says.
As competition for shoppers' dollars intensifies, malls, shopping centers and retailers will be paying even more attention to refining their use, storage and collection of valuable consumer data. "It's a never ending quest," says Epps of Simon DeBartolo. "We want as much information as we can get so we can better target our marketing efforts. I'm sure other [managers] will be doing the same."
Mike Sheridan is a Houston-based freelance writer.