A multi-million piece direct mail campaign will drop next month to help launch Tutition Answer, a new student loan product from Sallie Mae.
The credit-based product will offer loan assistance for all the costs associated with college, including tuition, housing and textbooks, according to Kaenan Hertz, marketing director for the Reston, VA-based financial services company. E-mail will also support the product launch.
Sallie Mae maintains a managed loan portfolio of over $92 billion in student loans for over seven million borrowers. The company also has home loan and debt management service businesses.
Three years ago, Sallie Mae began working to transform its database operations from a loan processing system to a customer centric system. The process was initially tried in-house, which was a “nightmare” from an IT perspective, said Hertz. Outsourcing services to Harte-Hanks brought costs down and increased the turnaround time, he said.
Harte-Hanks hosts Sallie Mae’s 17 million record database, which is updated monthly. The file includes consumer and transactional data for numerous Sallie Mae affiliated companies. Acxiom demographic and segmentation data is appended to the file; e-mail address overlays were tested but Hertz said the company isn’t sure this is worth the investment for the return.
Sallie Mae’s database includes terrestrial and e-mail addresses; source of name and loan; loan amount and status; lifestage coding from Personicx; channel contact preference; and contact history.
Major goals of the database marketing initiative include brand reinforcement, cross-selling, and most importantly, retaining the current customer base. While Sallie Mae doesn’t typically market to other companies’ loan clients for products like loan consolidation, other companies do actively solicit their client base, Hertz noted.
Several internal clients use the database, including loan products, home loans, servicing, government relations, strategic planning and corporate communications. Considering that all these departments deliver a total of eight to 10 million e-mails per month, the risk of fatigue is high, said Hertz, who spoke at the National Center for Database Marketing conference in San Francisco on Tuesday.
Keeping creative fresh is key to helping stem fatigue, he noted. Most of Sallie Mae’s e-mails are in a simple and straightforward letter format. To keep track of creative, the company has a subject line database. The test cycle of a winning subject line versus a “challenger” is typically as short as a week, he said.
In addition to other contacts, Sallie Mae sends two e-mail newsletters each month, TrueCareers and Wired Scholar. Hertz noted that the company tries to avoid using telephone numbers as response mechanisms in e-mail communications to avoid hard-to-handle call center spikes.
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