Then the Promotion Ends, and You Wonder: What Now?
The question is one of the oldest in marketing: What do you do with the names and addresses you capture during a promotion?
Many companies store them in the proverbial electronic shoebox and never look at them again.
“There is a huge amount of data being collected that is not being used,” says Terry Cunningham, president of Cottonwood Enterprises, a fulfillment firm that handles sweeps and contests.
But some firms do put their data to work. And they are reaping the benefits of long-term customer loyalty.
Take Kelly’s Roast Beef. This time last year, the small fast-food chain had 700 names in its database.
Then, it ran a February sweepstakes offering a trip to Ireland. That brought in more than 10,000 names, and Kelly’s will use them to send direct mail and e-mail for onsite promotions and new menu items and locations.
The chain, which has five restaurants and projects $26 million in annual sales this year, segments the names by ZIP code, and mails to people who live within five miles of an outlet.
“Loyal customers are the lifeblood of the Kelly’s Roast Beef organization,” says Sheri Saperstein Richberg, marketing consultant for the company. “We have to keep them informed, acknowledge their loyalty and show appreciation.”
Then there’s General Motors, which has a cross-brand database containing millions of names. Individual brands both use — and contribute data to — this base.
Buick, for instance, collected data from 525,000 people who entered a contest — run by Momentum Worldwide — to win a Buick Lucerne. Of that, 3,000 agreed to take a test drive and get a free hat autographed by Tiger Woods.
“Follow-up is really important,” says Larry Peck, Buick’s golf marketing manager. “Our main objective was building brand awareness. Ultimately, it’s all about sales and getting people into the dealerships.”
Like other GM brands, Buick uses an internal rating system based on purchase intent. People who are in the market to buy a new car immediately will receive different marketing messages from those who are not.
“If people are not buying a car for five years, they go to the bottom of the pile,” Peck adds. “They are less likely to receive much of anything. But if someone has a purchase intent of six months, they would be the highest priority.”
“Part of being smart is figuring out when using database marketing is right,” adds Steve Greifer, global head of promotions for Boston-based agency Digitas. “Smart marketers are the ones who know when to use the tool and when not to use the tool.”
Do Sweeps Entrants Work?
Granted, not everyone thinks promotional names are valuable. For example, many firms want to avoid sweepstakes hobbyists who rarely buy anything. “The sense among some marketers is that these databases are populated by the usual suspects,” Cunningham says.
But some brands do find them worthwhile. For example, Volvo collected 52,000 names during last summer’s Pirates of the Caribbean: Dead Man’s Chest promotion, and it promptly e-mailed those entrants, offering $500 toward a new vehicle.
Better yet, it also asked them to opt in for future messages and 28% did. They are now getting e-mail newsletters and promotions that are sent to the entire brand database. And Volvo will alert those players to the 2007 version of the Hunt.
“We realize that consumers opting-in for Volvo communications may not be in-market,” says Linda Gangeri, manager, national advertising manager for Volvo Cars of North America. “Therefore, we include them in ongoing communications about new models, along with Volvo news and programs to keep them engaged and to keep our brand in their consideration set when they are actually in-market for a new vehicle.”
Then there’s Warner Bros. Consumer Products. It has collected the names of more than 2,500 teenage girls in a effort to build its Tweety Squad program — in part, through promotions. And it has segmented them by age and hobby.
These names are valuable. For starters, Warner Bros. communicates with them all on a regular basis, which includes sending upcoming news about its Tweety pop-up shops, the first of which opens this summer in Los Angeles. And 350 of those girls signed up to join the exclusive Tweety Squad. These brand ambassadors receive monthly e-mails and actively promote the brand.
Some girls get free merchandise for turning friends on to company products. And they are invited to give feedback.
“One of the big motivations is to feed Warner Bros. constructive criticism to share with licensors and potential licensees, and show there is a big group of girls out there who are into Tweety,” says Matthew Glass, CEO of Grand Central Marketing, the agency handling the membership program.
Consumers in control
Despite all that, there’s one thing to keep in mind when building a database program: That consumers should have the final say.
“It really comes down to people opting in or not,” Buick’s Peck says. “If people choose not to opt in, they don’t get any communication. We totally respect their privacy.”
Digitas’ Greifer adds: “You have to balance how much information people are willing to give. That needs to be tempered by the realities of the marketplace, the realities of what consumers are going to give up and the value of what they are giving up.”
How much is too much? Experts say be smart, and don’t take consumers for granted.
“It’s important we are not spamming members,” says Jennifer Guillette, director of new media for Grand Central Marketing. “We don’t really want to over saturate.”
Volvo agrees.
“Be respectful of consumers’ time and understand you can’t flood them with communications,” Gangeri says. “True one-to-one marketing is when you can get more of a profile on these people and tailor the information you are sending to their specific lifestyle and their specific stage in life. But, so many marketers will instead use that information and flood people with communications. That is something we try to avoid.”
On the other hand, experts caution marketers not to miss out on remarketing potential.
How do you persuade consumers to give up their data? By offering incentives they can’t refuse.
“It has to be a pretty compelling offer,” says Anne-Marie Kline, vice president, director of promotions, for Digitas. “Some people are very skeptical. You have to know your audience.”
The best way to obtain data is to build trust.
“If you are creating a trusting relationship, people will be willing to give up a little privacy for a sweepstakes or exclusive access to something,” Greifer says. “Privacy is something you own. Marketers have to be explicit in what they are going to give up in exchange for that sacrifice.”
GMC collected purchase intent and consumer data for a chance to win one of 16 new Sierra trucks. The effort was part of the brand’s fall Keys to Victory sweepstakes, which Digitas handled.
Consumers who opted in for GMC marketing messages receive a monthly e-newsletter, and occasional e-mails and catalogs, upon request. In all, more than 1 million consumers are part of the automaker’s re-contact program.
“For us, collecting data was to make sure we are talking to the right people and that the message was resonating,” Kline says.
GMC stays in regular touch, but its messages vary depending on consumers’ interests.
“Every one to three months, everybody gets a different communication, anything from e-mail or a special catalog,” Kline adds. “We talk to these people and select a program that closely aligns with their areas of interest. It’s how we market to them moving forward.”
