Targeted e-mail marketing efforts deliver relevance for the recipient, while at the same time driving sales and establishing an effective model for personalized, interactive dialogue with customers.
Retailer Nine West has been peddling its selective accessories and footwear in malls, department stores and specialty shops since 1988. For much of that time, direct-mail efforts have worked well in luring customers and prospects into the stores. However, in recent years, direct-mail costs have soared and the shoe dynasty decided that it needed to find a new, more cost-effective way to target and alert its customers.
The White Plains, N.Y.-based designer, manufacturer and marketer of women's footwear, clothing and accessories, sells its merchandise in more than 5,500 retail and department stores, as well as in its own Nine West stores and online. As its customer base continued to grow in the late 1990s, with 100 mall stores opening each year, its traditional marketing budget didn't move with the curve. Marketing campaigns weren't experiencing the same success rates, because the reach and frequency of mail pieces weren't as deep and as often as they once were.
Nine West wanted to make the most of its marketing dollars, so it decided that a shift in strategy would benefit the shoe chain. For some time, the company had wanted to adopt electronic-marketing practices, so the time seemed appropriate to deploy an outbound e-mail-marketing system. It decided that a revenue boosting, relationship-building e-mail program would add benefit, while cutting the cost involved with sending direct mail.
Nine West eventually would come to learn that not only do e-mails serve as a more cost-effective marketing channel, but the ease of production would increase campaign frequency, and the ability to personalize content would result in targeted one-to-one communications.
E-mail is the answer
Dianne Binford, director of consumer direct marketing at Nine West, says finding an e-mail-marketing system that would help the company boost sales while creating lifetime value became Nine West's goal. "We didn't really have a problem, we had an objective," Binford says. "We saw e-mail as a more timely, more individualized, more frequent and more interactive way of connecting with the customer than direct mail, so we were eager to start using it."
During most of 2000, Binford and her team reviewed several outbound e-mail relationship-marketing vendors and eventually decided that Chicago-based Yesmail offered the best customer-acquisition and retention system to meet their needs. Binford says the solution outshined others in terms of its breadth. Called YesConnect, the e-mail technology delivers targeted, personal messages with campaign management, delivery, tracking and analysis features. "What impressed us about Yesmail was its commitment toward integrated marketing, because it isn't just about promoting a Web site, it's about communicating with the customer."
In October 2000, Nine West, working with Yesmail, launched the first of its monthly e-mail campaigns just two months after deploying the system. The company now sends monthly e-mail campaigns, but won't send them any more frequently so as not to blast its customers.
Nine West wanted the ability to tailor an e-newsletter based on both online and offline purchases. "We wanted everything we knew about her to be as individualized as possible," she says. Regional store information, special offers, alerts about new styles, and loyalty benefits for long-term customers fill the communique. New products are positioned at the top and merchandise is sometimes targeted based on customers' buying histories. The e-letter usually includes a "thank-you" message if the customer has recently shopped in a Nine West store, as well as loyalty benefits for VIPs and regional messages notifying customers about offers in nearby stores. "We take some painstaking efforts to make the content relevant and seamless, and we make offers that can be used both in the store and online," she notes.
Campaigns score big
Since deploying the first e-mail campaign two years ago, the company has learned that conducting one monthly e-mail campaign costs less than four direct-mail campaigns every year and is more effective, because the frequency of communication with e-mail grew four times greater than with direct-mail pieces. E-mail also has enabled the collection of customers' mailing addresses, which Binford says always had posed a challenge for the shoe chain previously. "Our e-mail campaign was an opportunity to prompt the customer to update her information," she says.
Sales also jumped, and response rates to in-store campaigns climbed to 50% to 70%. Nine West measures campaign results by monitoring click-through rates, looking at purchase conversion and examining open rates. The company found that click-through rates totaled 18% during the first six months of deployment, and Web sales saw a 20% to 40% rise. Since spring 2001, the Web site has received a steady 28% to 30% click-through rate. Prospecting campaigns also have met with positive results. A recent one generated the highest click-through rate the store has ever received, a huge purchase conversion and many e-mail signups. "Our e-mails are seeing four and a half times the click-through than the industry standard," Binford adds.
The most valuable benefit of e-mail marketing, Binford says, is as a vehicle for loyalty building and maintaining lifetime relationships. Nine West eventually plans to tailor e-mail to offer an individual customer's shoe size, as well as increased local messaging. Also, customers eventually will be able to purchase single-use, multi-channel gift certificates through e-mail. "We want to grow our e-mail list so that more and more of our customers can interact with us this way. E-mail gives the customer so much control and flexibility," he said.
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All materials copyright 2002 Peppers and Rogers Group - 1:1 Marketing.