DATE: March 26, 2012
PROBLEM: Create a measurable direct marketingcampaign that will entice recipients to further invest in the Wildflower Centerthrough membership, donations, and volunteer support.
SYMPTOMS: (1)0.89% response rate (2) Program lost$5,651 from the current campaign
CRITICAL FACTORS: (1) Current return on local package mailout (a) -$5,651 for total (b) variesfor each client ; (2) Prime targetmarket (a) Texan v. non-Texans ; (3) utilization of mailing lists ande-mail files; (4) attractiveness ofincentives (a) call to action (b) tote bag (c) brochure (d) tearout card (e) emphasis on joiningwebsite; (5) teaser direct mailcampaign; (6) seasonality affectingresponses
ALTERNATIVES: (A) Send out themembership pamphlet along with the tear out card in a Valpak which gets sentout to new homeowners upon their move-in into the city. Valpaks are basketsfull of coupons, pamphlets and free items that promote several businesseswithin the city so that new homeowners will be aware of those businesses andhave some kind of incentive to visit. PRO:(1) High reach (1,4, 5) (2) Highly targetable down to the zipcode (1, 2, 3, 4, 5) (3) Continuouscampaign which is sent to new homeowners no matter the season (5) (4) Measurable redemption rates (1, 2, 3) CON: (1) Pamphlet could get lost in theclutter of all the other coupons (1, 3, 5) (2) Targeting based on factors such as income instead of specialinterest for wildflowers (2) (3)Considerably higher printing costs (1) (4) Stresses the need for a mailing list that currently is notproviding positive returns (3) (5)Does not attract people to the website (4) (6) No immediate call to action since same coupons are used over along period of time (4)
(B)Deliver jumbo door hangers containing Wildflower Center information, specialevents, and a QR code directed to a landing page on the website containing moreinformation about LBJWC’s special events. PRO:(1) Convenient way of getting peopleto the website (4) (2) Notaffected by seasonality (6) (3)Since these are not included in the traditional mailbox as junk mail,people are more likely to take the time to read them instead of discarding themright away (1, 4, 5) (4) Sinceit is hanging on the door, people are likely to take them into their homes andlay them on the counter where they are more likely to be seen by others (1,4,5)(4) These are able to beproduced inexpensively, therefore reducing production costs from the current10% (1) CON: (1) Increased delivery costs (1) (2) Difficult to deliver to non-Texanhouseholds (2) (3) Limitedexposure with this type of advertising (2) (4) Targeting the same areas means that the ad designs will need tovary each time so that people do not throw them out as trash (2) (5) Based on the previous con,production costs will actually rise, therefore possibly eliminating the pro ofhaving low initial production costs (1)
(C) Investin a weekly email newsletter campaign containing pertinent information aboutLBJWC.PRO: (1) Highly targetable down to specific households as well as emailaddresses (2,3) (2) Bothhigh reach and high frequency (2) (3) Easily customizable to include basic center information eachweek as well as special events, gardening tips, coupons, prizes, etc. (4)(4) Minimizes production costs (1)(5) Eliminates paper waste (1)(6) Convenient way for recipient toaccess the website (4) (7) Highlymeasurable so that LBJWC can see the immediate return on their investments (1,4)CON: (1) Email overload in inboxes (1,2) (2) Difficulty with getting emailsthrough spam filters if newsletters are being sent to potential consumers whoare not already currently subscribed to such announcements (2,4) (3) Emailresponses and interest in the newsletter may lessen over time (1,2,3,4,5)
RECOMMENDATION: An email campaign thatis targeted toward current members, those who have requested more informationfrom the contact form on the website, as well as to consumers under specificlists that already provide high returns based on the financial summary in thecase, is the most effective direct marketing tactic for LBJWC. Accumulatingsuch email addresses to create a database of email addresses of the people whoare most likely to make monetary and time contributions to the center isrelatively inexpensive, reaches a wide consumer base and provides the mostreturn on the investment. “Direct mail is the advertising medium with the highest level of avoidance,”so LBJWC needs to keep users engaged with an alternate method of directmarketing. Creatingan attractive newsletter layout featuring photographs of the park and basicinformation about the center such as hours of operation, admission fees, andmaps, makes it easier for people who may be interested in visiting the centerto find the relevant information. Text and button links can be utilized,providing a direct path to the website and the specific landing pages that therecipients are interested in. For example, if the newsletter highlights asnippet about a new plant species that the center has acquired, recipients canclick the link in order to read the full article. The article page on thewebsite is the landing page for that link. This option is highly trackable andmeasurable because Google Analytics notates how many times landing pages arevisited, the rate of returning and new visitors to those pages, where thosehits on those pages are being directed from (from the newsletter) and how longvisitors are staying on each page. A PayPal button on the bottom of thenewsletter is a convenient way for donators to make a contribution. The abilityto opt-in and opt-out of the newsletter allows this option to reach only thepeople who have a sustaining interest in the organization.
ADDITIONAL COMMENTS: Identifying the topcontributors where the return on each dollar invested is highest is crucial sothat money will not be wasted on markets that don’t exceed the benchmark. Anygroup that does not at least give a return of a dollar does not meet thisrequirement. Based on the financialsummary in the case, currently, more than half of the lists of members andcontributors that are in the in-house data have positive returns. LBJWC alreadyhas these lists available to them, so these lists are not included in listrental expenses. However, only 6 of the 26 groups within the rented mailinglists provide a positive return. Those with negative returns include the homeownersassociation, half of the environmental organizations, all of the magazinecatalogs, the 2x+ multibuyers, and any art-related organizations except themuseums. Removing these unnecessary mailing lists will allow LBJWC to reduceits list rental costs which currently make up 15% of the program expenses($5,682.30). If LBJWC only buys 6/26 (roughly 23%) of those lists than what itis currently paying for lists, then that expense will only be about $1,311.30,therefore saving the organization $4,371.00. Deducting the savings from thecurrent total cost billed will make a new total cost billed of $33,511. This stepin turn drives down printing costs, and if printing costs are reduced by atleast $1,280 because of the previous step, then LBJWC will break even on itsinvestment and possibly even gain positive returns on its direct mail campaign,therefore rendering the campaign a success.
Fromthere, the organization should continue to test these higher-contributingmarkets and try to better understand their lifestyles and what motivates themto continue their support for LBJWC. According to Mintel, 39% of marketers believe the most effective incentives are discounts and savings, which isgood because LBJWC already implements discounted membership packages. Direct mail campaignsshould be tailored to fit their target markets’ interests and bigger incentivesshould be implemented to garner even more support. “By consideringcustomer segments and the different needs each has, perhaps there isopportunity to offer incentives thataddress their needs more directly than do points or discounts” (Mintel). Thiscould include big prizes related to nature such as vacation getaways to placessuch as Hawaii where some of the most beautiful botanical gardens grow. Entriesinto the drawing can be exclusively for LBJWC members and supporters. Smallincentives such as the free tote bag are not measurable motivators for a potentialmember to actually purchase a membership, so more research needs to be done todetermine if it is worth the cost to the program to continue to produce them.
Sources:
Mintel:
http://academic.mintel.com/sinatra/oxygen_academic/search_results/show&&&sort=relevant&access=accessible&archive=hide&source=non_snapshot&list=search_results/display/id=482902/display/id=548496?select_section=548497
http://academic.mintel.com/sinatra/oxygen_academic/search_results/show&/display/id=548880/display/id=610279#hit1
PROBLEM: Create a measurable direct marketingcampaign that will entice recipients to further invest in the Wildflower Centerthrough membership, donations, and volunteer support.
SYMPTOMS: (1)0.89% response rate (2) Program lost$5,651 from the current campaign
CRITICAL FACTORS: (1) Current return on local package mailout (a) -$5,651 for total (b) variesfor each client ; (2) Prime targetmarket (a) Texan v. non-Texans ; (3) utilization of mailing lists ande-mail files; (4) attractiveness ofincentives (a) call to action (b) tote bag (c) brochure (d) tearout card (e) emphasis on joiningwebsite; (5) teaser direct mailcampaign; (6) seasonality affectingresponses
ALTERNATIVES: (A) Send out themembership pamphlet along with the tear out card in a Valpak which gets sentout to new homeowners upon their move-in into the city. Valpaks are basketsfull of coupons, pamphlets and free items that promote several businesseswithin the city so that new homeowners will be aware of those businesses andhave some kind of incentive to visit. PRO:(1) High reach (1,4, 5) (2) Highly targetable down to the zipcode (1, 2, 3, 4, 5) (3) Continuouscampaign which is sent to new homeowners no matter the season (5) (4) Measurable redemption rates (1, 2, 3) CON: (1) Pamphlet could get lost in theclutter of all the other coupons (1, 3, 5) (2) Targeting based on factors such as income instead of specialinterest for wildflowers (2) (3)Considerably higher printing costs (1) (4) Stresses the need for a mailing list that currently is notproviding positive returns (3) (5)Does not attract people to the website (4) (6) No immediate call to action since same coupons are used over along period of time (4)
(B)Deliver jumbo door hangers containing Wildflower Center information, specialevents, and a QR code directed to a landing page on the website containing moreinformation about LBJWC’s special events. PRO:(1) Convenient way of getting peopleto the website (4) (2) Notaffected by seasonality (6) (3)Since these are not included in the traditional mailbox as junk mail,people are more likely to take the time to read them instead of discarding themright away (1, 4, 5) (4) Sinceit is hanging on the door, people are likely to take them into their homes andlay them on the counter where they are more likely to be seen by others (1,4,5)(4) These are able to beproduced inexpensively, therefore reducing production costs from the current10% (1) CON: (1) Increased delivery costs (1) (2) Difficult to deliver to non-Texanhouseholds (2) (3) Limitedexposure with this type of advertising (2) (4) Targeting the same areas means that the ad designs will need tovary each time so that people do not throw them out as trash (2) (5) Based on the previous con,production costs will actually rise, therefore possibly eliminating the pro ofhaving low initial production costs (1)
(C) Investin a weekly email newsletter campaign containing pertinent information aboutLBJWC.PRO: (1) Highly targetable down to specific households as well as emailaddresses (2,3) (2) Bothhigh reach and high frequency (2) (3) Easily customizable to include basic center information eachweek as well as special events, gardening tips, coupons, prizes, etc. (4)(4) Minimizes production costs (1)(5) Eliminates paper waste (1)(6) Convenient way for recipient toaccess the website (4) (7) Highlymeasurable so that LBJWC can see the immediate return on their investments (1,4)CON: (1) Email overload in inboxes (1,2) (2) Difficulty with getting emailsthrough spam filters if newsletters are being sent to potential consumers whoare not already currently subscribed to such announcements (2,4) (3) Emailresponses and interest in the newsletter may lessen over time (1,2,3,4,5)
RECOMMENDATION: An email campaign thatis targeted toward current members, those who have requested more informationfrom the contact form on the website, as well as to consumers under specificlists that already provide high returns based on the financial summary in thecase, is the most effective direct marketing tactic for LBJWC. Accumulatingsuch email addresses to create a database of email addresses of the people whoare most likely to make monetary and time contributions to the center isrelatively inexpensive, reaches a wide consumer base and provides the mostreturn on the investment. “Direct mail is the advertising medium with the highest level of avoidance,”so LBJWC needs to keep users engaged with an alternate method of directmarketing. Creatingan attractive newsletter layout featuring photographs of the park and basicinformation about the center such as hours of operation, admission fees, andmaps, makes it easier for people who may be interested in visiting the centerto find the relevant information. Text and button links can be utilized,providing a direct path to the website and the specific landing pages that therecipients are interested in. For example, if the newsletter highlights asnippet about a new plant species that the center has acquired, recipients canclick the link in order to read the full article. The article page on thewebsite is the landing page for that link. This option is highly trackable andmeasurable because Google Analytics notates how many times landing pages arevisited, the rate of returning and new visitors to those pages, where thosehits on those pages are being directed from (from the newsletter) and how longvisitors are staying on each page. A PayPal button on the bottom of thenewsletter is a convenient way for donators to make a contribution. The abilityto opt-in and opt-out of the newsletter allows this option to reach only thepeople who have a sustaining interest in the organization.
ADDITIONAL COMMENTS: Identifying the topcontributors where the return on each dollar invested is highest is crucial sothat money will not be wasted on markets that don’t exceed the benchmark. Anygroup that does not at least give a return of a dollar does not meet thisrequirement. Based on the financialsummary in the case, currently, more than half of the lists of members andcontributors that are in the in-house data have positive returns. LBJWC alreadyhas these lists available to them, so these lists are not included in listrental expenses. However, only 6 of the 26 groups within the rented mailinglists provide a positive return. Those with negative returns include the homeownersassociation, half of the environmental organizations, all of the magazinecatalogs, the 2x+ multibuyers, and any art-related organizations except themuseums. Removing these unnecessary mailing lists will allow LBJWC to reduceits list rental costs which currently make up 15% of the program expenses($5,682.30). If LBJWC only buys 6/26 (roughly 23%) of those lists than what itis currently paying for lists, then that expense will only be about $1,311.30,therefore saving the organization $4,371.00. Deducting the savings from thecurrent total cost billed will make a new total cost billed of $33,511. This stepin turn drives down printing costs, and if printing costs are reduced by atleast $1,280 because of the previous step, then LBJWC will break even on itsinvestment and possibly even gain positive returns on its direct mail campaign,therefore rendering the campaign a success.
Fromthere, the organization should continue to test these higher-contributingmarkets and try to better understand their lifestyles and what motivates themto continue their support for LBJWC. According to Mintel, 39% of marketers believe the most effective incentives are discounts and savings, which isgood because LBJWC already implements discounted membership packages. Direct mail campaignsshould be tailored to fit their target markets’ interests and bigger incentivesshould be implemented to garner even more support. “By consideringcustomer segments and the different needs each has, perhaps there isopportunity to offer incentives thataddress their needs more directly than do points or discounts” (Mintel). Thiscould include big prizes related to nature such as vacation getaways to placessuch as Hawaii where some of the most beautiful botanical gardens grow. Entriesinto the drawing can be exclusively for LBJWC members and supporters. Smallincentives such as the free tote bag are not measurable motivators for a potentialmember to actually purchase a membership, so more research needs to be done todetermine if it is worth the cost to the program to continue to produce them.
Sources:
Mintel:
http://academic.mintel.com/sinatra/oxygen_academic/search_results/show&&&sort=relevant&access=accessible&archive=hide&source=non_snapshot&list=search_results/display/id=482902/display/id=548496?select_section=548497
http://academic.mintel.com/sinatra/oxygen_academic/search_results/show&/display/id=548880/display/id=610279#hit1
