How to Shape Up Your Holiday Circulation Plan

Holiday 2012 is closer than we think. Although it’s the first week in April, it’s time to prepare your contact strategy for the holiday season.

There are 32 selling days versus 30 last year in 2011, and these extra selling days are good for business.
Thanksgiving is November 22 and we have the added bonus of five weeks of November, giving us eight selling days in November versus only six last year. Once again this year, Christmas Eve falls on a day when packages are delivered (Monday) since Christmas Day on Tuesday (and Hanukkah is in early December).

Your circulation plan needs to have a micro-segmentation approach. Not every customer is the same as the next. Spend the time now analyzing like-groups. Remember segmentation is about combining groups of customers with similar behavior so you can predict future behavior.

And yes, segmentation is much more difficult than it was five years ago. With mobile apps and gaining popularity, and often ubiquitous discussions about the latest tablet, there’s a new generation of buyers who aren’t traditional catalog (or even traditional multichannel) shoppers. Segmentation needs to identify this new group and sans the catalog and instead go digital—not simply digital, but relevant and timely.

Today, review your year-to-date customer count by month, as well as your new-to-file customer count by month. Doing this now lets you know if you are doing better than last year or worse. Knowing allows you to identify contingency plans for the holiday season. If you’re running ahead of last year, then you may find you’re gaining momentum and you should capitalize on it. If numbers are lagging, then you need to immediately develop strategies to recoup the loss in holiday season.

Here’s three other things you need to do to get your circulation plan in shape for Holiday 2012…

Don’t mail customers

Yes, you read that correctly. Identify customers on your database who purchased only one time and their one purchase happened last holiday.

Isolate these customers and develop an online (or mobile) strategy for them. They are likely looking for a convenient gift-giving solution (versus a budding loyal customer) and last year your merchandise met the criteria.

This year communicate with them in a way that matches their style–electronically. For the customers in this segment who do not have a promotable email or mobile number, consider not mailing them at all (and yes, you should structure a test to ensure you’re doing the right thing…odds are, you will be!)

Plan now for Black Friday and Cyber Monday

Last year, The National Retail Federation compiled data to reveal 226 million shoppers had $399 average spend (up $34 dollars from 2010). Cyber Monday stats from comScore indicate 2011 tallied 1.251 billion dollars, up 22% from 2010. We can all bemoan the economy is bad, but given this time of year, the consumer is purposefully spending money—are you giving them a reason to buy from you?

For seasonal planning, you must segment customers who have a promotable email (customers who welcome marketing communications from you) versus those who do not. With many years of testing behind me (across a variety of markets) you will find that your best customers with or without an email, can profitably support every single contact you make.

The second best group of customers who have a promotable email can support one less mailed contact in the season—this group’s productivity will be enhanced (less marketing dollars spent while maintaining revenue).

The third best group of customers has higher productivity when you have a higher ratio of emails versus catalogs (however the group without a promotable email needs the catalog contacts.) Plan now to develop a seasonal contact test to determine the best contact cadence for your business.

Identify customers with multiple ship-to addresses

Often times these ship-to addresses are actually gift recipients. If you can isolate customers who give gifts, use this information to create a special mailing.

The mailing includes a list of the ship-to name and address plus the item that was shipped last year (and if the item is no longer available, suggest a substitution or leave the information blank). Think of this service in terms of the customer experience—how convenient to know whom I sent gifts and what I sent.

From a business perspective, you need to decide how many gift recipients are economically viable for this mailing. You might conclude this type of campaign only makes economic sense when a customer has four or more recipients—although there are multichannel merchants who can profitably mail to a customer who has only one recipient.

And from experience, I confidently tell you to test the boundaries. Last year a client tested mailing to customers with one recipient. The one recipient had multiple criteria (merchandise category, price point, location to a retail store, promotable email indicator, etc.) and with a comprehensive text matrix, the learnings were powerful and are shaping 2012 planning.

Gina Valentinois president of catalog consultancy Hemisphere Marketing.

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