Acquiring new customers is tough. You can’t use e-mail (“spam” really is a four-letter word). And while direct mail is expensive, it really is the logical choice for acquisition.
A retail pharmacy client of ours was facing this dilemma. The client was using direct mail with attractive offers to bring in new pharmacy customers with some success. But each major campaign was taking about 6 months of new-customer revenue to reach break-even. That’s just no good.
With our DMboost assessment of their program, we determined that improving targeting would yield the largest and fastest improvement in program ROI. Then we took it further: If we could find a way to target higher spending households and eliminate the low-spending ones, program ROI should improve dramatically over the old geo-targeting approach.
We worked with the client to build a set of proprietary models that would predict the likelihood of a household to have certain medical conditions—and then use these model scores to target those households with higher likely pharmacy spend.
The result? Program break-even went from 6 months to 1 month. Even cooler, the client got promoted for making the company so much money.
We took a long, hard look at one electronic retailer’s direct marketing efforts and saw that program performance was stalling out because of generic messaging. We knew that if we put more relevant and timely messages into the hands of customers, response rates would increase significantly. But wait… the solution gets more sophisticated.
Instead of sending out the quarterly, one-size-fits-all direct mail, we analyzed historical purchase patterns and set up a variable-message mailer based on a customer’s last purchase. It was both timelier (it mailed closer to the last purchase date) and more relevant (it suggested logical add-on products to the last purchase).
Even with the higher per-piece price, the trigger-based mailer provided an ROI 235% higher than the old standby. Who wouldn’t want that kind of return?
One of our best clients expressed a real concern that his traffic-driving marketing vehicles—weekly newspaper inserts—were losing reach and effectiveness due to reduced circulation.
When we assessed the problem, we knew that the basic strategy of delivering discounts to households was still sound. After all, a healthy percentage of the population loves discounts (especially us).
But we recognized an opportunity to revitalize the strategy by upping the ante on execution. Meaning we had to think about other direct channels to increase circulation. E-mail was a logical choice as it offered low cost per impression and opportunities for personalization. Not only that, e-mail would make it possible to match the offers to the individual based on what he or she had purchased in the past.
In the end, this highly personalized electronic circular created significantly higher ROI than FSIs alone and achieved the objectives of increasing overall circulation and redemption rates.
Our toy retailer client was getting overwhelmed by a much larger competitor, one who also had a successful loyalty program in place. Unless our client developed a loyalty program of its own, it would continue to get creamed.
In designing this program, we kept the costs down by doing enrollment and ongoing engagement online. And instead of focusing primarily on points accumulation, we designed program benefits for the online space: games that kids would enjoy, quarterly e-newsletters, birthday e-mails, hot toys updates, “savvy Mommy” content, surveys, and more.
The story has a very happy ending. We were able to get a new loyalty program in place quickly (four months) for a fraction of the cost-per-member when compared to the big guys. Child’s play, really.
Location, location, location. One retail client was having competitive issues with the “big box” stores. A major advantage this retailer had was convenience: it had many more locations than the big box guys. So we decided to translate that convenience into dollars.
Using mapping software, we first calculated the distance to the closest competitor and our client’s closest location. Then we translated the mileage difference and calculated the gas savings and money saved per month if shoppers visited our client once a week instead of the competitor. The savings were calculated for every individual and printed right on the front of the mailer
The “save gas, save time, save money” direct mail piece was made even more powerful by including a coupon the value of which was based on total customer value. The more you had shopped with our client, the higher the coupon value.
Turns out this was the most successful direct mail piece this client has ever done and continues to outperform all other programs.
“We’ve just acquired 400 stores. Now… er… how are we going to meet our new customers?”
That’s what one of our retail clients asked themselves (and us) after a major acquisition. Very quickly, the client needed to communicate new service benefits, location changes, store remodel notifications, and grand re-openings to a brand new customer base.
With a new universe of 400 store locations and 6MM pieces of variable content/multiple format direct mail, it was a large spend for the company. But after a thorough RFP process that involved several national printing and mailing companies, our client deemed that Agency 180’s direct mail expertise was best fit to deliver a cost-effective and high quality solution.
Working directly with the client’s marketing and store operations teams, we devised a workflow to assume full responsibility for all aspects of the direct mail program. We even led weekly project status meetings and developed detailed market and
location-specific status reports to ensure that the client was in the loop at all times.
In short, we made our client’s life easier, something we love to do.
Companies don’t just have one type of customer, they have many types. And almost always, their best customers are different from the average customer.
One healthcare client of ours (walk-in clinics) had a moderately successful track record of using mass media to drive traffic to their clinics. Once a patient had visited, the client shifted to direct marketing to stimulate repeat visits.
When we conducted an assessment, we found that the client’s direct marketing targeting was based on the average customer profile. We felt that better targeting would have the largest impact on ROI, so we conducted a customer profile analysis for the client and found that its core (and most profitable) customers had a different, more narrow demographic profile than average.
This simple finding had two significant impacts on our client’s marketing plans:
- For existing-patient marketing, the client could narrow some of the direct marketing targeting and reduce costs while still retaining its best customers.
- The client could change its mass media buys to target the narrower demographic profile and mix in tightly targeted direct mail, which had previously been uneconomical.
(Can you tell we love this stuff?) Understanding its core customers better paid off big time for this client, yielding better results at a reduced cost.
A national healthcare insurer believed that if it could provide helpful information and tips to subscribers about why and how to stay on their medical regimens, then regimen compliance would go up and catastrophic healthcare events would decline—as would insurance payouts. So the insurer came to us.
It was tricky business, though. We had to navigate HIPAA regulations, patient sensitivities, and the doctor’s role in a patient’s care. So we conducted focus groups across the country with subscribers and doctors to discover which message content and format would be most successful with each constituency.
The patient piece ended up being a closed #10, four-color mailer that included helpful tips on how to stay on regimen, information about patient-specific regimens, and a message encouraging recipients to talk to their doctors.
The physician piece was also a #10 format that provided a list of patients who had been communicated with, as well as a page for each patient that identified potential adverse drug reactions and alerted the physician about compliance issues. Each page was to stay in the patient’s file as a reminder for the next visit.
The result? Well, costs are down and both doctor and patient satisfaction are up. Just what the doctor ordered.
Beautiful ROI—more than skin deep.
Launching new products is hard work, especially in the highly competitive skin care arena. So when a leading skin care manufacturer came to us for help on a “new product” direct marketing program, we immediately went to work on figuring out how to make a very expensive product sampling mailer more productive.
The first thing we didn’t do was call the creative team. We know that changing the creative aspect makes very little difference in most cases. Most of the smart money, actually, is in the targeting—especially with an expensive piece like a product sampler.
So here’s what we did: we combined multiple retail loyalty member files (members who bought in the category) with third-party prospect data and ran them through a “machine learning” modeling process. The result was extremely focused targeting that propelled the mailing to a double-digit response rate and a dramatic ROI spike. We also lengthened the “legs” of the program by increasing traffic to the client’s website, where we collected mail preference data for future efforts.
Now that’s a good-looking 1-to-1 initiative.
So many worries, so little time.
Branding. Media buys. Direct marketing efforts. Offer management. Co-op programs with retailers.
Manufacturers delivering against a target for annual unit sales have a tough life. Simplifying things makes sense… sometimes. In direct marketing, taking a simple approach usually results in loose targeting and a one-size-fits-all message—and average-to-blah results.
A vitamin manufacturer client of ours found out it doesn’t have to be that way. Working closely with data from the manufacturer’s retail pharmacy partners and its own marketing database, we were able to narrow its targeting and develop more segmented messaging based on customer profiles and product purchase history.
The result? A reduction in the number of wasted mail pieces. Significantly higher ROI for our client’s direct marketing programs. And, because we managed the whole process for the client—including the retailer relationships (a specialty of ours)—it freed up time for the client to focus on other projects… something everyone could use these days.