• Wall Street Journal (subscription required) , Wednesday, November 26, 2008 11 AM

With advertising budgets under pressure, marketers are reaching out to loyal consumers with targeted ads instead of relying on the traditional yuletide blitz of advertising to the masses, Emily Steel reports. Retailers such as Sears Holdings, JCPenney, Target and Gap are tapping statistical models and other technologies to send specific consumers promotions based on what is potentially on their shopping lists.

Although companies have been tracking customers for years, recent technology enables them to link all the data points together to create campaigns that take full advantage of the information that's has been gathered. Acquiring new customers is five to seven times more costly than milking existing ones.

"I don't have to tell you where the store is, I don't have to tell you the virtues of the brand," says Marc Fleishhacker, managing director at WPP's Ogilvy Consulting, which designed an email and point-of-sale campaign for Sears. "I just have to say, 'Thank you for coming to Sears. We have even more products and opportunities for you.'"

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