One example is a pizza chain that seems to know everything about its customers’ pizza preferences — what they order, when they order, when they last ordered. When you are marketing to customers, the more you know the more relevant you can make your marketing messages. A customer who always orders pepperoni with extra cheese will likely get a post card with a picture of just that pizza pie. If the customer hasn’t been in for a while, the post card might include a message from the manager of their favorite location, saying, “We’ve missed you!”
To bring that valued customer back, the direct mail piece might include a discount on the next pizza the customer orders. Several strategies are at play here. For one, the direct mail serves to reinforce a valuable relationship. Marketing experts’ opinions vary, but most agree that it costs less to keep a customer than to win over a new one. Some put the cost of a new customer at five to seven times the cost of retaining a current customer.
The piece also drives sales, by offering a value. Surveys show that people like getting discount offers in the mail, and often redeem them. And, because redemption of a coupon is involved, the pizza chain can track the impact of its direct mail campaign.
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