At the beginning of the cycle, you must identify business issues such as target market, product strategy and pricing strategy. Feed this information into your strategic business planning. This should allow for the generation of a hypothesis based on all relevant, current consumer and business information. External research should be completed to supplement business knowledge and facilitate planning. This external research may include a review of the marketplace using available resources or primary research. Examples of primary research include brand equity research, consumer segmentation and new product research.

The second step is to move from strategic planning to tactical decision making with respect to marketing plans. One important aspect of tactical direct response plans is targeting consumers for a marketing treatment. Efficient targeting results in higher response rates at lower cost; thereby improving marketing ROI over untargeted direct response campaigns. A list of targeted consumers is generated based on propensity behavior models. This list is comprised of those consumers most likely to generate favorable campaign results and an optimized campaign performance. For example, a response model is completed and the output is a list of those consumers most likely to respond. Other propensity models and resulting lists may be more relevant depending on the business issue. A conversion model will generate a list of those consumers most likely to convert and an attrition model will generate a list of consumers who are most likely to abandon your business. Knowing which consumers are at risk allows you to develop a targeted list for save campaigns.

80% of all business are lost due to lack of proper follow up and service. The third and probably most important of the cycle, you must serve your target consumers with special attention which most often is overlooked and will certainly make you different if you make this your best practice. Small differences like personalizing their experience will be a great start and with time understand their needs and make sure you serve them to the best of your ability.

Understanding what works in marketing campaigns and the financial return therein is important. Marketers can use this information to justify their investment. The only way to truly understand return on marketing investment, however, is to measure consumer response to targeted marketing campaigns. So, the analytical test design of the campaign is implemented to set the stage for results measurement. The test design may be either a test-and-control design or a multivariate test design depending on business need. From there, the Analytic Cycle continues as marketers update and adapt their consumer understanding using information from what has worked in past campaigns. By creating a test and learn environment aligned with the scientific method, marketers can make better business decisions and continuously improve ROI. All thanks to a little science.