Commentary & Analysis
The Real Key to Successful One-to-One Marketing
By Mike Wesner January 12,
By WhatTheyThink Staff
Published: January 11, 2004
By Mike Wesner January 12, 2004 -- While driving to a meeting with the Marketing Director of a major furniture company, I was visualizing the upcoming meeting and trying to develop a strategy in my mind that would get his attention. And I was coming up empty until I hit on the perfect example for his needs. I thought back to the afternoon when I finally got this guy on the phone--a late afternoon when I decided to uphold one of my long time business rules--make one more call before ending the day. I had been given this marketing director's name by someone in the furniture industry and I was told that he was very sharp and that he might be one that would embrace new and emerging marketing techniques. And I did finally get him on the phone that late afternoon. I could tell immediately that he was battle tested—tired of all the print salespeople that had called on him during the years. I gave my thirty second commercial where I shared with him that I wanted to help him increase sales; wanted to look at how he was “mining” data, and wanted to help him use the advanced techniques of one-to-one marketing. I went on to share that I had a proven method for getting higher response rates on his direct marketing efforts. He dismissed me quickly and said that he had been hearing this buzz about variable data printing but that in his industry, people's buying habits were very unpredictable. He did not feel that these tools could ever work in the retail furniture industry. He went on to share that people buy furniture only when their current furniture was worn out and that was on average, once every six to seven years. He felt that personalization and customization would provide no real results for him and said that in his market the most effective channel would probably always be the newsprint circulars included in Sunday papers. Flattery Will Get You 20 Minutes I flattered him saying that I had heard good things about him from one of his manufacturers and told him I could be his one-to-one marketing consultant and actually help him increase his market share and make him a leader in one-to-one marketing techniques in his industry. I promised not to take more than twenty minutes during which time I would show him samples and let him decide if he ever wanted to see me again. He gave me the 20 minutes. I was in…but I still wasn't sure how I was going to get his attention. I thought I should maybe listen to my tape on how to win friends and influence people on the trip to his office. Armed with the recent knowledge of an empirical research project we had recently participated in, I knew I had some pretty interesting case studies and samples to share with him. One case study was especially interesting and was separating itself from the others in our research. This participant, a national retailer, was showing some pretty phenomenal response rates. We had achieved a rate of 62 percent in a recurring weekly post card program. Yet I was unsure how to share this information because I wasn't sure if this example would help me convince him of the power of variable data printing or help him convince me that he really should not have scheduled this meeting. Offer Relevance In our research, we developed a Control Group with no variable data except for the household address; a Level Two group that included text personalization; and a Level Three population that used customized images and graphics. The retailer had good data, a good (but not great) design, and good use of variable data techniques The problem with our finding was that the we were receiving a 62 percent response rate with our control group. That's right. No variable data. No variable images. Meanwhile, Levels Two and Three had a 68 percent response rate. What was going on? I was about to unlock what has turned out to be one of the great exaggerators in one-to-one marketing success. It's offer relevance. Where the retailer distinguished themselves was in the analytics and predictive modeling they used to know the exact offer to make to their customers. As in the Mikasa bridal registry case study presented by PODi's Best Digital Printing Practices of 2002, this group was able to take a buying event and effectively predict future buying events. And they were successful just because they had the addresses of those whose credit cards purchased their products . Sure the variable data helped some. But they were making relevant offers to their customers—offers so relevant that it overshadowed the lift provided by variable data imaging. Now what marketer out there would not kill for a 62 percent return? A Little Intuition Armed with this knowledge and the information I recently read on the Mikasa bridal registry case study, I tried to think of a way to demonstrate this same type of predictive modeling that would help the skeptical marketing leader I was soon to meet. It finally hit me a few miles from where I was headed. And by the way, you don't have to be a statistics wizard who understands how to calculate multiple regression to effectively predict things in purchasing and event cycles. Sometimes it can just be figured out with pure intuition. A few years ago, my wife and I bought a new bedroom suite. This set was the Alexander Julian edition and we were pretty excited about it since we had a Tarheel affinity for Alexander Julian and his connection to Chapel Hill, North Carolina where we both went to college. His men's store “Julians” still exists there today on Franklin Street and we were jazzed about having his furniture in our home. But at the time we could only afford four of the seven pieces available with Alexander's trademark plaid designs in the wood grain. We thought to ourselves that we would some day get some of the peripherals when we could afford them—nice pieces like the haberdasher and armoire and other neat stuff that I don't know how to pronounce. Wow, I had it, and I was ready to share this personal testimony. A testimony about how I still only had four pieces of this bedroom suite and how a single nudge, with a one-to-one marketing piece, with a call to action, and a 10 percent off offer might have been just the thing to get me to add at least one more piece to our bedroom furniture collection. Soon the marketing leader was sharing with me how he had been trying to convince his CFO to let him do stuff like this and how he wanted me to come back and meet this the CFO and his MIS department and help them develop a data-mining and event-driven marketing strategy for his team. During my last phone call with the marketing director, a plan was being developed on how to allocate some of his MIS resources so that a system of “event driven” marketing could be initiated. And finally, I didn't have to talk about printing--even variable data printing. I talked about how to increase revenues with one-to-one marketing techniques by trying to accurately predict and make relevant offers to current customers. Yes, 62 percent response rates get attention and excite even the most cynical marketing leaders.