PC&D MAGAZINE
Targeting customers by direct mail
From Volume 23, Issue 2 - February 1999
Feature
How to tailor an effective marketing program on any budget.
by: Kati Davis
 
 Related Information
  Traditional marketing dollars and sense

Whether you are a small, one-location wash or a multi-site chain, database marketing is a good choice for carwashes:

Ö You can target individual customer segments.

Ö It makes economic sense.

Ö No matter what level of commitment you make, you can reap the benefits.

The economics of targeted direct mail are very appealing.

Direct mail response is measurable. It's easy to count the number of people who visited your wash because they received your mailer and how much money they spent on that trip. You can even calculate a true return on investment to ascertain how much money you made vs. what you spent.

Database marketing offers a quick response time. You can expect mailers to start coming back within two to three days of mailing. This is beneficial if you wish to generate some volume in the near term. Mailers can be sent out and customers will appear within days.

You can spread the returns over time. Because the nature of these mailers is smaller, targeted groups you can spread out mailings so the returns will be spread out as well. Of course, people will always want to come in on those busier days, but you can keep them from all coming on the same busy day by spreading the volume throughout the entire month.

Database marketing is more weather resistant. A string of bad weather can ruin an advertising campaign, but with the length of term of the direct mail, you can generally get through a spell of weather and still reap the benefit of your efforts.

Target customer segments

The best way to increase the visit pattern at your wash is by individually targeting customer segments - frequent customers (those who visit your wash six or more times per year), infrequent customers (visit one to five times per year) and potential customers (have not visited for more than one year).

Database marketing is the perfect choice to accomplish these objectives. It's the only advertising medium that lets you individually target specific groups of people and tailor your message to push their individual "hot buttons."

Can you commit?

The degree to which you can commit to this program will determine the level of benefit you receive from it.

Say you are an owner-operator who is very involved in the day-to-day operations of your wash. You donít have much of an office staff. Administrative support is limited to a good cashier who helps with the paperwork.

For you to embark on a comprehensive direct mail marketing plan would not make sense. You will probably do a great job in the beginning, but your focus will shift as other problems come up, and database marketing will move to the back burner.

You'll feel guilty, and database marketing will become a thorn in your side. Your results will not be what they should and you will discontinue the program.

Rather than getting into this cycle, focus your time and efforts on a small program, run it consistently and run it well. You can always expand your direct mail program later.

Here are some small, focused programs you can operate with limited amount:

 Birthday mailers. Extremely popular among and greatly appreciated by customers. Your response rate will be extremely high - from 20 to 40 percent.

You may already give a free full-service wash to customers who visit around their birthday. But by mailing a birthday card with a deep discount you can actually increase the number of customers who will take advantage of this benefit and make money in the process.

 Frequent customer appreciation. Because "frequent customers" represent a small percentage of your customer base, they are a manageable group to mail to. They are not highly motivated by discounts and donít really need them to revisit your wash. They do, however, respond to recognition and appreciation.

Frequent customers are the best candidates for other services you offer, such as fast lube or express detail. Be sure to recognize on the mailer that they are a great customer and because of your appreciation they can take advantage of a great offer on another one of your services.

Another idea for frequent customer appreciation mailers is cross- marketing. Form a relationship with an area fast food restaurant, dry cleaner, fast lube or other automotive-related service.

Have them create an offer - preferably something free - then mail it to your frequent customers. The other merchant gets the benefit of being exposed to your best customers, you are perceived as giving something special and customers get a great benefit.

Don't forget, the card must come from you. Do not loan, sell or farm out your customer list. While customers may appreciate good offers from you, they will not appreciate you selling their name to other companies.

 New-car owner programs. Most of us are familiar with those programs that offer one or more free washes to anyone who buys a new vehicle from a particular dealer.

By obtaining the list of new car purchasers you can manage this program more completely by sending a mailer to them directly rather than through the dealership. You control what, when and how the information is conveyed.

Depending on how many dealers you interact with and how you choose to limit their lists, this is a manageable program to run consistently.

Consider running the dealer's list against your customer list so you can provide different mailers and offers to current and prospective customers and hit their individual hot buttons to maximize the return.

Medium commitment

Are you an owner-operator who is not as involved in day-to-day operations or one who has a very competent assistant? You have more time to devote to a direct mail program; let's say you want to get the attention of your "infrequent customers," the goal being to increase carwash volume.

In addition to the programs already discussed, you can add more mailers to entice those infrequent customers to return more often. In order to do this you must analyze their current visit patterns and send them something to entice a new visit.

Direct mail is no different from other advertising - repetition is key. While you can expect a 5 percent to 20 percent return from the mailer, not everyone will respond to the first one. Follow up with another mailer immediately after the first one expires. Continue following up with those who donít respond, sending up to four or five sequential mailers.

If they donít respond to any of those, move them into the "potential customer" bracket. Remember, those who havenít visited in more than a year are potential customers.

Consider sending a survey card to customers who havenít visited in a long time (nine to 12 months), asking them why. Include four to five options for them to check and a place for them to write in their own response.

Upper management and owners should review the responses carefully. A lot of valuable information can come from these survey cards.

High commitment

If you have a strong support staff, possibly including a marketing person, a full-blown direct mail program may be feasible. In addition to the mailers and programs already outlined you would attack the "potential customer" group.

You can use direct mail to attract new customers, but it's not easy.

Return rates won't be high - usually 3 percent to 6 percent. If you have to purchase a list you may not make enough to cover postage.

However, donít get frustrated. Studies have shown that one-third of new customers attracted via direct mail will become frequent customers within six months. This means you have educated that customer and changed their buying patterns.

Kati Davis, marketing director for TEC Carwash Services, oversees database marketing services for retail carwash and fast lube operations. She also develops marketing programs for carwashes throughout the United States.

For more information, please go to www.carwash.com, click the "archives" icon and use the following keyword in an article search: marketing.

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