D e l i v e r i n g
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RMDMA WORKSHOP | DENVER
Making the DM Channel
Work for You
Patty Coldwater
VP Marketing
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Introduction
The premise of this workshop: small and medium sized businesses continue to
use direct marketing (specifically direct mail) successfully in today’s market place.
We’ll be discussing three companies and their direct mail programs in the
workshop:
• Rota and Smith Restorative & Cosmetic Dentistry – Colorado Springs
• Master Tech Inc. Automotive Service – Colorado Springs
• Powell Renovations – Des Moines, Washington
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Rota & Smith Restorative & Cosmetic Dentistry
Background info:
Started this program in 1989. This will be their 20th year of operating the same
program. It was the result of attending a seminar on dental practice development.
Their objective was to grow a $1,000,000 practice in the first year.
Objective:
Acquire new patients for dental practice with cosmetic dentistry specialization
Market:
New residents in neighborhoods near the location of the practice, selected for income.
Method:
Mail to new movers every month. Add newest month of movers, drop the oldest from
the database – ensuring that all new movers get 4 communications from Rota & Smith
Dentistry. Each mailing goes to 2500 to 3500 families.
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Package:
6 x 9 white envelope; 1/1 3-page letter, offer card (2/2, 5.25” x 4.125” finished size –
folded card)
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Rota & Smith Restorative & Cosmetic Dentistry
Offer:
Initial office visit, one hour exam including oral video dental exam,
periodontal check (gums), oral cancer screening (adults), digital X-rays,
cosmetic imaging and smile evaluation, private consultation with the doctor
and full report of findings for $99 ($300 value)
Results:
Through the years their return on investment has ranged between 300% and
600%. It’s their main method for adding new clients who then become
active referrers to the practice.
Referral program:
Existing customers get credits on their account for referring new patients.
They can use those credits for any procedure the Doctors offer.
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Rota & Smith Restorative & Cosmetic Dentistry
Budget:
~ $2000/month (print, postage, mail processing)
Quotes from the marketing manager you might find interesting:
“Responses are down a bit in 2008 and 2009, but our ROI on the program is still about
300%.”
“We don’t accept dental insurance, so we don’t compete with ‘retail dentists’ like
Comfort Dental.”
“Location is still very important, so we mail strictly in zip codes within a 3-5 mile drive of
our office and we do pay attention to ‘barriers’ in selecting the areas we mail.”
“It’s most important to be consistent. We dropped the program for a few months and
our new client load immediately dropped to about 1/5th of normal with the program.”
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Rota & Smith Restorative & Cosmetic Dentistry
Quotes from the marketing manager you might find interesting: (cont’)
“In 20 years of practice, direct mail has always been #1 or #2 in terms of effective
advertising. The mailbox is still an ‘event’. And people spend more time with their mail
than other media.”
“You have to be there when the prospect is looking. That’s why I think our program is
so successful. We don’t give up after one or two contacts. Each new mover is
contacted four times in the 12 months following their move.”
“It’s surprising how many folks save our mailing and use it when they need it,
sometimes months after they received it.”
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Master Tech Inc. Automotive Service
Background info:
Started this program in 2004 when Larry Jamison opened Master Tech. This will be their
5th year of operating the same program out of 6 years in business.
Objectives:
Acquire new customers for automotive service company. Develop ongoing relationship
with existing customers.
Market:
Residents in neighborhoods near the location of the service center. Saturation, carrier
route mailing. Drive distance no more than 3 miles.
Method:
Mail to 850-1200 residents every week (2 carrier routes). In addition they send direct
mail maintenance reminders to existing customer base.
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Master Tech Inc. Automotive Service
Package: 5.5” x 8.5” letter card.
4/1, print quantity 20,000
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Master Tech Inc. Automotive Service
Offer:
Current offer is 10% or $25 off any repair over $150 (whichever is greater).
This year they’ll increase the dollar value of the offer and drop the %
discount because they’ve discovered that people are more motivated by the
hard cash discount offer.
Results:
Average growth per year is 10%. Most of Larry’s automotive repair
competitors are down this year, but Master Tech is up 15% in total sales.
Last week (week of December 14th) they had 10 new customers and the
weekly average is between 10 and 20.
Other advertising:
None
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Master Tech Inc. Automotive Service
Budget:
When Larry started this program he was devoting about 7% of his gross sales
to his direct mail advertising efforts. As his sales have grown, he now
devotes 3-4% of gross sales to direct mail. The mailings cost $315/1000 so
his annual budget is approximately $16,500.
In 2006, they dropped their acquisition direct mail. In their 6 years of
business that was the only year that sales were flat. The reinstituted the
mailing program in 2007 and sales grew over 10% that year.
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Master Tech Inc. Automotive Service
Quotes from James you might find interesting:
His advice? “Don’t do hit and miss – get in and stay in it. Be there in the mail box when
something malfunctions or breaks down. Be honest. Provide exactly what you promise.
Provide quality service with the latest automotive diagnostic and repair technology.”
“Keep good records, analyze response and customer characteristics. For instance, over
60% of our customers are women, so we try to communicate in ways that appeal to our
potential customers, and reach them where we don’t have so much competition.”
“We researched advertising methods before we opened the shop. We didn’t want to
compete with shops for the ‘lowest price’ coupon users. We definitely get our money’s
worth using weekly direct mail advertising”
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Powell Renovations
Background info:
Powell Homes took the slow new construction market as an opportunity to launch a
home remodeling division in 2008. Powell Renovations mailed the first “Imagine” piece
twice in 2008 and the Powell-Built remodeling piece once.
“Imagine” Objectives:
Secure at least 10 in-home presentations and convert at least 3 of them to projects.
Projects need to exceed $50,000 each.
Market:
Powell Renovations targeted 800 homes in the area where Brooks and Todd Powell live,
Normandy Park, Seattle, Washington. The list was a conventional compiled database of
homeowners in carrier routes for their neighborhood. This group was mailed in June
and again in August, 2008 for a total of 1600.
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Powell Renovations
The Package: 13” x 10” jumbo card. 4/4. Personalized letter on address side of card,
photos of Powell Renovations interiors on the back.
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Powell Renovations
Offer:
“Call today for a FREE in-home renovation analysis! We’ll bring you a $50
Starbucks® Gift Card when we meet!” Response options included local phone or
web landing page.
Message:
Emphasized protecting the investment you’ve made in your home by updating it
with any amenity you can imagine: home office, theater, chef’s kitchen, larger
rooms, raised ceilings, etc.
Results:
Eight in-home renovation analyses were completed. Three renovation projects
were sold totaling $300,000. One of these came several months after the first
mailing. Powell Renovations received a call from a homeowner on Mercer Island
whose daughter passed the card on. That particular homeowner purchased a
$150,000 remodeling project for her home.
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Powell Renovations
Background info:
Brooks and Todd decided that some of their best prospects for remodeling were folks
who owned a Powell-built home. Brooks and Todd are the 4th generation of Powells to
own Powell Homes. The company has a record of every home they have built in the last
100 years and they have searched county records and know who owns each home now.
“Powell Built Homes” Objectives:
Secure at least 5 in-home presentations and convert at least 3 of them to projects.
Market:
Powell Renovations targeted 576 owners of Powell-built homes in the Seattle area.
Offer:
As an experiment, the Starbucks® Gift Card offer was set at $25 (as opposed to $50) and
offered to anyone who completed an in-home remodeling analysis conference.
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Powell Renovations
The Package: 13” x 10” jumbo card. 4/4. Personalized letter on address side of card,
photos of Powell built homes on the back.
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Powell Renovations
Message:
The personalized letter emphasized that Powell Homes built the “house you now
call home. Space needs re-evaluation and may call for change and updating.” Who
better to make the upgrades you want than the folks who built your home?
Results:
Nine in-home renovation analyses were completed (almost double their goal).
Four renovation projects were sold totaling $100,000. At one of the meetings that
resulted in a sale, the husband confessed that they chose Powell Renovations
because of the $25 Starbucks® gift card. “My wife was about to throw away the
card when I said, ‘Hey, don’t we get a $25 Starbucks card if we meet with those
guys?’ We were planning on remodeling anyway, and the card made the difference
of who we called. Once we met the Powell brothers we were impressed and that
sealed our decision.”
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Powell Renovations
Budget:
For the two mailings, design, printing, postage ~ $3000.
Quotes from Brooks Powell you might find interesting:
“We started using direct mail in 1986 on the recommendation of a friend in the mail
business.”
“We try to have something in the mail every 6 weeks or so; either to send to users of
our services or to real estate and mortgage professionals.”
“The other thing we’ve found effective is sponsoring community events; women’s
health events; community celebrations, etc. It keeps our name out there as community
supporters who care about our neighbors.”
“Our response rates consistently come in between 2-3%, and we seem to always get a
good return on our investment in direct mail.”
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Powell Renovations
Other Powell Mailing Projects:
Powell Homes did a number of “newscards” in 2008 and 2009. I’ve provided some
examples on the next few slides. This is the outside of the women’s health fair
sponsorship card.
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Other Powell Mailing Projects:
This is the inside of the women’s health fair sponsorship card.
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Other Powell Mailing Projects:
Powell Homes did a number of “newscards” in 2008 and 2009. This is the 100 year
anniversary card.
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Other Powell Mailing Projects:
uInside of the 100 year anniversary card.
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Powell Renovations
Other Powell Mailing Projects:
The most current remodeling mailer (sent out in December, 2009) – no results yet,
of course. Size is 11” x 5.5”. 4/4 printing. Same offer of $25 Starbucks® gift card.
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Powell Renovations
Other Powell Mailing Projects:
The most current remodeling mailer (sent out in December, 2009) – no results yet,
of course. Size is 11” x 5.5”. 4/4 printing. Same offer of $25 Starbucks® gift card.
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Powell Renovations
Annual budget for direct mail: $12,000 - $15,000
Advice from the Powell brothers:
Focus on your markets. Know your customer. Know what appeals to them.
Mail consistently. Look for new markets to explore and don’t be afraid to approach
them and see what happens.
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Discussion Questions:
What’s common to each of these successful small business direct mail case
studies?
Could any of these clients benefit from more sophisticated direct marketing
strategies? If so, what?
What do you observe about the offers each of these mailers has chosen to use?
What types of challenges do each of these mailers face?
How have their direct mail programs enabled them to meet their unique
challenges?
Has our current economic situation had an impact on these mailers? If so, in
what ways?
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Your Questions:
Thanks for your time and attention!
I have live samples of most of the mail pieces in this presentation; please feel free to come up and examine any of them
or ones from the panel presentation after we’re dismissed.
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