Tired of rising customer acquisition costs in traditional media, Nova International Services Inc. has decided to put more focus on online media.
The Blue Bell, PA-based firm, which co-markets membership programs to consumers, has rolled out several data-driven campaigns using banner advertising and e-mail. These channels are already Nova’s biggest and least expensive sources for acquiring new customers, topping billing inserts, telemarketing and direct response television.
Nova offers discounts, coupons and incentives on airline fares, hotels, car rentals and 275,000 products. And it cross-markets memberships with a 196-page Buyer’s Rewards book it sells for $79.95.
The expanded online marketing program began last November when Nova adapted DRTV scripts and tested 120 banner offer variations. The ongoing rollout is based on the results of those tests.
Nova is working with Hotsocket Inc., New York, which is responsible for online creative and database management. Hotsocket now rolls out 15 to 20 banner or e-mail campaigns for Nova every week.
In addition, Nova works with marketing partners to distribute millions of banner impressions per week. (These efforts are independent of the promotions it does with Hotsocket.) The partners promote the Nova rewards programs on their Web sites.
The key to success is properly targeting the sites. “The Internet is so self-segmented,” says David Gerhardt, vice president of business development at Nova. “You can target tons of segments on a micro level because people give information sofreely through registration.”
Targeting is done in an intuitive way, based on response patterns and demographics.
“None of the analytics we do is new to direct marketing,” says Dev Bhatia, founder and CEO of Hotsocket. “The magic is what happens after someone clicks. The offer can change with the next clickthrough.” Cumulative data aggregated from prior consumer transactions is used to create hundreds of variations of the offers, which are programmed to automatically change as more customer data information is added to the online database.
Test results for campaigns are analyzed daily as the bulk of response is normally generated within 48 hours. Data from the earliest arriving responses is often used to make changes and adjustments in campaigns to boost later arriving responses.
Demographic variables are analyzed in relationship to which variables generate response through specific online formats, e-mail, banners or pop-up windows. These may vary depending on whether the recipient receives the promotion through Yahoo!, Lycos, America Online or another means.
The time of day an offer is distributed can have a big impact on response. Different versions of the same offer may be sent to the same person, depending on whether they are using a home computer or one at a workplace. That’s because computers at business addresses typically can download larger, more complex files faster than a computer at home.
Bhatia feels it is more important to focus on the creative and the offer than testing lists for online marketing. “The cost of untargeted direct mail is expensive, but the cost of mistargeting online is low, which means I don’t care how mistargeted a banner is because the offer and creative are more important,” he says.
Has Nova given up on traditional media? No. It plans to continue using offline promotions – in fact, the same data used for online targeting is also used for outbound teleservices scripts and billing inserts.
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