Interactive marketing is defined as the “process of being able to deal with customers by creating individual relationship, managing market size of one and addressing each in terms of its stage of development” (Blattberg et al., 1991). It has always been the dream of marketers to be able to establish a dialogue with each consumer and position the organization to serve the needs of the consumer. For effective relationship building, marketers have looked to several methods of collecting feedback about consumers and their buying habits. Most of these approaches have been indirect, expensive and rarely available at the level of individual consumer. Now, the Internet interface is capable of providing the marketer with just that kind of information useful in addressing each consumer personally in a most effective and inexpensive way.


Understanding The Consumer

The Internet provides various ways to collect information about consumers in order to know them better. Consumers frequently fill out forms on the Web to have access to Web site services. Further, during their on-line shopping, they provide several inputs regarding the products, quantities, and other preferences which can be captured and stored by the interface in files like the “cookies” and “session logs”. These details can be used by the marketer to tailor the promotion message or product offering to the needs of the particular consumer. For example, a consumer who has recently asked for maternity benefits to be added to her health insurance, can be provided specific promotion and offers related to pre-natal care. In addition, the details of her location and family can be used to give her a specific deal at a nearby store. This consumer information can be constantly tracked to offer the benefits related to baby care in future.

As standards of consumer data capture and code of ethics are developed and accepted, personal details of the consumer and her purchase habits can be used by the marketer to benefit both the consumer and the business.


Data Mining For Understanding The Consumer

The large volume of data spread over the Web makes it a difficult job for the marketer to collect the data and extract information using traditional analysis tools. Data mining tools offer effective ways to search and extract useful patterns from these huge mass of Web data. Data mining is a non trivial process of searching and analyzing data in order to find implicit, but potentially useful, information (Frawley et al., 1992). It is a process of searching large databases using techniques like statistical analysis, visualization, decision trees, and neural networks to explore large amounts of data and discover interesting patterns that shed light on business problems.

Data mining on the Web is still at its infancy. As more understanding is gained about the structure of the data captured over the Web, we expect that specific data mining tools will be offered to extract consumer information from Web data. Armed with this knowledge about the consumer, the marketer can use the information processing capability of the computer to engage the consumer in an interactive dialogue, thus building a one-to-one relationship with the consumer.

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