Let’s say that the vast majority of your sales come in the third and fourth quarters of the year. Maybe as much as 80% of your business is done in the last few months of the year, making this the only time of year that it makes sense to prospect. So what can you do to keep in touch with your customers in the off-season? For that matter, what exactly is the off-season? Is it spring and summer? January through August?
More to the point, is it even necessary to reach out to these customers at all? Why not just wait until early September, when your next seasonal catalog mailing will drop?
In today’s competitive catalog and Internet business, it is totally unacceptable to contact customers only during, say, the fourth quarter of the year and to ignore them for nine months. What will first-time buyers think, to say nothing of your two-, three-, and many-time customers? They may wonder if you’re still in business if they don’t hear from you.
Building a long-term relationship with catalog customers means creating a contact strategy that touches them year-round. The secret is to be innovative enough in the off-season to generate sufficient money to at least break even, as well as to keep your year-round staff busy. A number of techniques can help you keep in touch with your customers and generate additional revenue to retain staff, make the most of your facilities, and contribute to overall profitability:
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Special inventory liquidation sale Everyone likes a sale, and the use of sale-type words generally increases response to mailings. Retailers are the most innovative in coming up with sales jargon and unique events. Catalogers can take a page from their book in “inventing” a special sale that works for the company. Every catalog should be testing the off-season months to ascertain whether it can extend the season this way. For instance, the postcard from apparel marketer Woolrich below shows a “Backroom Clearance Sale” that helps the company push sales through its Website.
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One-day or weekend sale This is traditionally a clearance event that is pushed via the phone or Internet to reach a nation-wide audience. But you can advertise this type of special event via e-mail or direct mail. Again, a postcard format has proven quite effective in getting customers’ attention and letting them know what’s occurring. Cooking supplies and gifts cataloger Gooseberry Patch has historically used postcards to promote this type of event.
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Promotional events geared to the season Picnics, barbeques, Father’s Day, and beach and boat trips are just a few seasonal excuses for multiproduct promotions to customers. So are weddings and graduations.
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Outbound phone calls or e-mail follow-ups A regular outbound phone call or e-mail campaign can work well for corporate clients, such as those that use your catalog or Website for thank-you gifts, incentive programs, and corporate promotions. While many consumers may object to such contacts, companies expect and often welcome this sort of contact, especially if it is in conjunction with a special promotion. Companies such as Omaha Steaks effectively use this strategy with business clients.
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VIP treatment Often we pay undue attention to our problem customer segments — those with inactive accounts or low average order values (AOVs) — when we should be asking ourselves, “What have we done for our best, most loyal buyers?” We need to remember that 80% of a catalog’s revenue typically comes from 20% of its customers. Yet it is not unusual for catalogers to never as much as say “thank you” to these people — a major faux pas! What about prioritizing your customer list into a hierarchy something like this:
- Last season’s buyers who spent more than $1,000 with your company
- Last season’s buyers who spent $500-$1,000
- Last season’s buyers who spent $250-$499
- Last season’s buyers who spent more than $100 but less than $250
- One-year buyers who didn’t make a purchase last year, but spent more than $1,000 the previous holiday season
- One-year buyers who didn’t make a purchase last year but spent $500-$1,000 the previous holiday season
- The proven technique is to send this group an out-of-season thank-you. The thank-you might include a gift with the note, a gift that can vary with the value of the customer. We recommend that you send it several weeks ahead of your first contact or promotion to this group — for instance, mid- or late August if your first mailing is scheduled to drop in September. But resist the urge to tell these customers that your new catalog is coming in a couple of weeks. Keep this message a thank-you; the catalog will speak for itself.
Special communications for special customers
In addition to your best buyers, there are two other groups of customers that you should single out: off-season shoppers and first-time buyers.
Individuals or companies that have made purchases in the off-season should be at the top of your circulation plan: After all, if they needed your products during the slow season, imagine how much they’d need your merchandise during peak times. It also makes sense to work with a co-op database so that you can model these names and find more catalog buyers like them.
Building an ongoing relationship with first-time buyers from the holiday season is critical if you are interested in repeat business. You cannot ignore these new buyers for six or nine months and hope to get them back the following holiday season. Creating a separate first-time buyer contact strategy is wise. It might start with a thank-you, acknowledging that this is their first purchase from you. Remailing a catalog within 30 days of the initial purchase is another proven winner. Getting the second purchase in the off-season starts to solidify that all-important relationship with customers. It can pay off handsomely the following fall with larger AOVs and significantly higher response levels.
Format for off-season promotions
When communicating with customers in the off-season, cost-effectiveness is key, especially with print runs that are typically much smaller than in your prime season. A few media to consider:
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Catalog — sfull size or a smaller, digest-size book. Reducing page counts can lower your in-the-mail costs. Look for ways to do multiple cover changes or versions of a common catalog to save money.
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Direct mail — a seasonal promotion offering targeted products can work well in an envelope.
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Postcard — as mentioned earlier, it can highlight a one-day or weekend sale or other special event.
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Newsletter — a wonderful way to keep in touch with customers monthly or quarterly. You might do it electronically to save expenses.
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Push e-mail campaign — another great way to talk to customers and promote your company and its products. You’ll need to test to find the optimal frequency of e-mail messages so that customers aren’t turned off. Remember that a customer opt-in is not optional; it’s now mandatory.
In general, e-mail is a cost-effective way to keep in touch with your customers in the off season. In today’s multichannel environment, every direct seller should be striving to capture customer e-mail addresses in order to build a regular communication link with customers without having to spend big bucks for a mailing. What makes more sense: an e-mail contact with buyers for several cents a contact or a direct mail promotion for $0.40 or $0.50 each? It’s a no-brainer.
Jack Schmid is founder of J. Schmid & Associates, a Shawnee Mission, KS-based catalog consultancy.