Variable Data Helps Drive Customer Retention
The Guardian Club is a membership organization that provides a wide variety of automotive and travel services. Though it is a national organization with centralized marketing initiatives, each regional office has a budget for area-specific outreach. The director in our region wanted to market heavily to new members. She explained that the first year of membership is critical to establishing long-term relationships.
Since Guardian was marketing to recently enrolled members, we knew that their data would be the key to their campaign. We decided on a sophisticated, highly variable direct mail campaign in which the member would receive one mailing per month for seven consecutive months. Each mailer included a personalized welcome letter, brochure, self-mailer, and insert with an incentive designed to track responses. One of the inserts offered a referral bonus to members, and a discount on annual membership to the referral. In addition to customer retention, the campaign served as a cross-sell/upsell opportunity.
The referral program had a response rate of just over 2.5%, yielding 144 new members in nine months. The insurance mailer garnered 1,568 calls, a response rate of 28%. Over a 12-month period, attrition was 50% lower among the 5,600 people targeted in the campaign than the general membership base. The campaign was extremely cost effective and required only a 6% increase in annual membership.