Case Studies

Working with a client with extensive file of active email addresses, we established benchmarks for price and marketing position in under three weeks for a margin-sensitive, competitive consumer electronic product. To achieve this, we:

• Applied classic direct marketing testing techniques to the email environment. Simultaneously tested pricing and creative positioning while holding other variables constant and mailing across the file. Cells in a given test ranged from 4 to 14.
• Analyzed campaign in under thee weeks given the speed of web response and begin a refined email offer in under a month, effectively consolidating what takes 6 to 9 months in direct mail to under 45 days.
• Achieved results: our initial “winning” price—which was not the lowest—and marketing positioning had a cost-per sale better than break even and cost was 50% less than initial direct mail efforts.
• Subsequent refinements of marketing positioning and development of a response model reduced the cost-per-sale another 25%. Client has now sold millions of dollars of moderate margin electronic products at a profit—in less than 18 months.

Our client has engaged in multi-channel efforts selling auto insurance for many years. As this market has become much more competitive, we—and several other teams—were approached to “beat the control” and lower the acquisition cost of their direct mail efforts in a multi-phase effort.

• We conducted a “MarketMatrix” test—combining many offers, package variations and customer profiles in one test with over 60 panels (a marked departure from traditional direct mail tests).
• We then analyzed results in several ways (from response rates to policies sold) for “hot spots” and worked with our client to develop a multi-variant response model. The best packages and offers achieved results 15% to 30% better than the “control.”
• We then created a focused “MarketMatrix Validation,” combining the best results from the messaging and package testing and also validating the response model. In this round of testing, the combination of strong package and strong offer improved results another 15% to the random panels.
• Additionally, validating the new response model achieved dramatically improved results. Response rates increased marginally, but the conversion-to-sale rate almost doubled, reducing the cost-per-sale for the top five modeled segments by 65%.
• Finally, in a rollout scenario, the client is able to balance optimizing the marketing spend with two objectives—writing the most new policies and at the lowest possible cost—by balancing the winning variables.

Our client, an arts-focused university began approaching alumni and friends to make low-level donations to an Annual Fund with systematic direct mail campaigns only a few years ago.

They adopted a "one size fits most" approach, having only a modest mailable universe. Using well-designed, four-color mail kits, the efforts focused in a highly-conceptual way on linking donating with helping students pursue their dreams and become artistic leaders. The initial results were encouraging, but decreased dramatically after the first few campaigns, particularly as mailing frequency declined and economic conditions deteriorated. We were asked to re-vitalize the efforts with two clear objectives: increase the number of active donors and decrease the cost of fundraising.

• Reviewing the Annual Fund's mission, we learned it was two-fold: helping fund tuition aid (needed by eight out of ten students) and funding general operating expenses. Then we informally polled donors and prospects attempting to learn what motivated them. Our conclusion: helping students pay for their education provided the emotional justification to give.
• Using this, we developed a master marketing/messaging template for the campaigns focusing almost exclusively on the idea of helping students get tuition aid.
• Simultaneously, we began applying basic direct marketing best practices to create targeted segments to mail: alumni, friends and prospects; current and lapsed donors; as well as older and younger alumni. The basic message was massaged to reflect 20 donor and prospecting segments.
• By focusing on these segments we moved from a generic mailing kit to a letter-based format with a high degree of personalization. We attempted to make the package as relevant to the donor and their behavior as possible.
• From the personalized outer envelope (with a live stamp), to the letter customized with a message from a relevant "author" (former student, dean or director of development), individual suggested donations and up-sell options, to the reply card with variable suggested giving levels, every element focused on the targeted segment and recipient.
• The results after several campaigns have exceeded the client's expectations. The response rate has increased by 400% over prior campaigns, donations are up 350% per campaign and the cost of fundraising has declined by 60%. Additionally, the campaign has re-activated lapsed donors and increased new donors four-fold.

We'd relish the opportunity to apply this learning to help more not-for-profit institutions meet their fundraising goals.