Marketing Case Study: Mailing List Fail

In this edition of “I Have a Story,” The Marketing Writer’s blog, we present a marketing case study that underscores the importance of a clean direct mail list.

Direct mail continues to produce strong results with an average response rate of 9% for house lists. A house list is a list of a business’ customers or people with whom the business has a connection.

Prospect lists also do well these days with an average 4.9% response rate. Prospect lists can be sourced from other companies, compiled from public directories, gathered from subscribers of magazines, or rented from sweepstakes and coupon companies. The results of a mailing using either a house or prospect lists depend, of course, not just on the list, but on three additional factors: the offer, timing, creative.

This marketing case study looks at how a company got everything right…except for the mailing list.

It’s a company you may have heard about: Chewy.com.

Marketing Case Study: Pet Product Company Mailing List Fail

Chewy.com is an online retailer of pet products selling everything from dog training equipment to goldfish food. They are known for great customer service, fast shipping, and competitive pricing.

A few months ago, we received an offer of $15 off of our first order. With seven cats and a new puppy on the way, we gladly used our coupon and were delighted with the entire ordering experience. We purchased cat food and continued to hope for more offers from the company via email, but the offers we received were for specialty products and gourmet foods, which our rescued cats don’t get. (Sorry, fellas, but y’all just showed up here…you get what you get, and that’s Friskies and Meow Mix.)

Marketing Case Study: Direct Mailing List Failure

Then in July, we received another mailer from Chewy.com. This mailer touted $15 off again. We held onto it knowing our new puppy, Zeke, would arrive in August and need some items.

We tried to utilize the coupon this week only to find we could not – it was for first-time customers only, and of course, we were returning customers now.

It was supposed to be our second order. We did not place the order.

Always Suppress Current Customers from a Mailing to New Customers

Chewy offers excellent customer service, but somehow, their marketing department neglected to update their mailing list against their customer list.

An offer for a new or first time customer should NEVER be sent to current customers.

Mailing lists can be compared using specialized software so that any potential duplicates are flagged and removed. If Chewy purchased a list of pet owners or people who own pets, for example, they could then send this list to a mailing list company or data provider and have any potential duplicates suppressed from the final list.

Why bother spending the money to suppress duplicates?

Because customers like us, eager to order again, left disappointed and annoyed at the fine print on an offer that we thought we qualified for but didn’t.

If a company mails us a coupon, we assume we can use it. It should never be incumbent on the customer to get out a magnifying glass and check the fine print on the offer. And it is deadly to your e-commerce business to have customers get all the way to the checkout and as a last step, enter a coupon code only to be told the offer isn’t valid.

We abandoned our shopping cart and bought the cat food and dog harness from Amazon. No, we didn’t get $15 off, but we got free shipping and didn’t feel cheated by the offer.

Key Takeaways: Direct Mail Basics

DO…

  • Create a compelling offer. The Chewy offer was great. So was their timing and their creative execution.
  • Be 100% sure that offers for new or first-time customers ONLY get sent ONLY to new and first-time customers. You can do this by sending your list data to a mailing house who runs it through a computer program and compares the prospect list to your customer file and suppresses any duplicates.
  • Provide a way to honor the coupon if you make a mistake. Don’t just turn customers away.

If Chewy woos us back with a great offer, we may consider shopping from them again. But with Amazon so convenient and accessible, and no feeling of being screwed over by them as we did when we were disappointed at finding our coupon didn’t work, we may not.

Reinvigorating Retail through Pop Up Stores

Pop up stores are here and they may be reinvigorating retail throughout the United States.

As a teenager in the 1980s, I spent an inordinate amount of time at the local shopping mall. Roosevelt Field Mall became my home away from home. My sister worked at Macy’s. She would drive to work, drop me off to roam the mall, then I’d meet her several hours later for the drive home.

Pop up stores back then were kiosks. Small, self-contained kiosks in the central aisle of the mall’s corridors. Some sold only items during peak gift-giving seasons: I remember the bonsai tree concession, another that sold crystal pendants during the pendant-wearing craze of the late 1980s. Another etched personalized messages, monograms and the like on silver picture frames, mugs, etc.

Each of these tiny stores focused exclusively on a single them. They differ from today’s pop up stores the way your grandfather’s Chevy differs from the Volt parked in your garage and recharging from the household current.

Linda Niehm, professor of Apparel Events, and Hospitality at Iowa State University stated in a recent press release, “What we’re seeing is in part of a natural evolution of the retail cycle, and old formats are replaced with something more relevant.”

Retail is a dynamic industry. It is constantly evolving and changing. Stores evolved from single-category shops (the butcher, the baker, the candlestick maker) to the grocery store and supermarket (with butcher and bakery counters along with thousands of other products) and the department store (which sold everything including candles in one convenient space.) The internet added pricing competition along with an intense focus on fresh new goods; if I can get a pair of jeans from Amazon at a lower price, why should I bother driving to the Gap in the mall to buy a pair?

Enter the pop-up store. These stores take over small retail spaces for short amounts of time – weeks, perhaps – with a themed experience. Vacant stores or unusual structures such as disused cargo containers are transformed into a retail space.

Niehm and colleague Ann Marie Fiore conducted a study in 2010 that indicated that retail consumers like novelty in their shopping experiences. The same old stores in the mall bore consumers; the novel experience of discovering a new brand, product category, or style in a pop-up store may invigorate the shopping experience and draw customers away from their computers to shop on the internet and back to physical retail spaces. Millennials especially are interested in brands that resonate with their values. They eschew large, traditional stores.

Brands are experimenting with pop-ups in unique ways. Bonobos khakis opened pop-up stores in the lobby of an office building and netted $250,000.

Technology offers another way for pop-ups to succeed. Although the small space prohibits stocking multiple colors or sizes, with the touch of a tablet, shopkeepers can order items from their online store to be sent to the consumer. No hassle, no additional steps for the customers, and an easy in-person shopping experience that lets them see and touch the items in person.

Are pop-ups right for you? They may be a passing fad, but anything that can reinvigorate retail offers additional methods for small business owners to sell more. It may be the right time for you to explore pop-ups for your retail business.

Why Customer Service Matters

We’ve all experienced awful service. We’ve all experienced good service.

As business people, we all know – or should know- the value of excellent customer service.

How valuable is good customer service? If you improve service by just 5%, according to Bain & Company, profits can increase 25 to 90%.

So with just a little effort, training, and better hiring practices, you may be able to increase profits. Who wouldn’t want that?

In this article written for Medium, I share not just the facts about why good customer service matters, but how to achieve it without spending a fortunate on fancy loyalty programs, punch cards, free gift with purchase items and so on.

Enacting a strong customer service policy isn’t expensive, but it’s not easy. It takes thought, effort, and consistency. When it’s done well, however, it can reduce customer attrition (churn) and boost profits.

Again, I ask: Who wouldn’t want that?

Read the full article here: The Customer Pays Your Salary – Why Excellent Customer Service Is Vital for Client Retention

Content Marketing Mistakes

I really liked this post from Amy Gynn on Content Marketing mistakes. I see so many of these mistakes, and most of them are easily prevented or corrected. Besides, a good infographic on content marketing deserves to be shared.

Customers Are Won, Not Managed

Far too often I hear company executive talk about “managing their customers.” Customers are people who pay your salary, not widgets to be managed.

You can manage expectations, but managing people for profitability is just…wrong.

Let’s talk instead about building trust, value, and long term relationships for enduring loyalty. And yes, profits. Profits come after building trust and value.

Today I’ve published a new piece on Medium talking about how CRM is often used to mean software instead of the relationship itself. You may read the article here: Don’t Manage Customer Relationships. Build Them.