Survival of the fittest

When times were good, brands could rely on consumer trust. If you did a good job, people responded. But having watched the demise of the banks over the past year, consumers have had that trust shaken to the core. As a result, brands have to work a lot harder to generate trust and get consumers to part with their cash.

Direct communications is one area where companies can reach consumers quickly on an individual basis. It doesn’t take a genius to work out that those brands failing to fine-tune their direct marketing to appeal to valued customers and address trust issues are likely to suffer in 2009.

It is fortunate, then, that industry insiders believe something of an evolution is taking place. The days of mass mailings – both direct mail and email – are well and truly over, they say.

The former approach never really worked anyway, according to Andy Ruddle, sales and marketing director at REAL Digital. “It had little to do with targeting, timeliness or appeal; consumers were rightly cheesed off by it; and how can such tiny conversion rates be viable?” he asks.

Simone Barratt, UK managing director of email specialist e-Dialog, describes the need for a more focused approach/ “the same relevance story that we’ve all been singing for so long”.

Her clients, which include BA, NatWest and Sony, are divided into two camps, she says. Some are “like rabbits in the headlights, keeping their heads down”, while others are taking a more aggressive stance, honing their strategies to sell themselves out of the recession.

“Now’s the time to focus on analytics,” she says. “It’s a healthy response to ask whether we are working as efficiently as possible.”

For the majority of direct specialists, the focus has shifted to retention rather than acquisition. “It’s about cross- and up-sell right now,” says Mike Spicer, group managing director of EHS Brann. “CRM and loyalty are an important part of the mix.”

EHS Brann is working with easyJet, for example, to improve customer journey management – looking into whether certain people always book the same trip at the same time every year, or whether they only ever fly from one particular airport, and targeting their offers around such information.

Any marketer worth his salt knows you’ve got to show you’re aware how the recession affects individuals and change your messaging accordingly. “For once, the customer really is king,” adds Spicer.

And “personalisation” doesn’t just mean slapping someone’s name on a letter or, for travel brands, boasting “I know what you did last summer”. Sam Jordan, managing director of agency Baber Smith, is well aware that this simplistic or overly informed approach can do more harm than good: “What some brands can learn about customers, particularly financial brands, would terrify people if they saw it staring back at them from their computer screen and doormat.”

Small things can make a big difference – whether that’s asking consumers how they would prefer to be contacted, thanking them for choosing your brand or sending follow-up emails asking how their experiences could be improved.

Data lies at the heart of such effective communication. “Use the information that’s available online,” says Steve Davis, executive vice-president and president international at GSI Commerce. “Maybe someone left items in a shopping basket but didn’t purchase. A follow-up email checking everything is OK can be helpful.”

He believes that using data well is vital for businesses. “There is no question that brands are showing a much tighter focus on data now, due to all the difficulties they are facing,” he adds.

Some think that brands are doing well at integrating direct communications in the face of a recession. Tony Spong, business director at client/agency intermediary AAR, says: “People are thinking in terms of combinations of channels.”

True integration, however, is not easy to achieve. Bob Udale, planning director at Archibald Ingall Stretton, says that, as a customer of First Direct, and despite his respect for the brand, he’s been disappointed by the seeming lack of a joined-up strategy between his behaviour online and the direct mail he receives. “Although it generally has a customer-centric approach, it seems the two aren’t totally joined up. It needs to be seamless to feel natural,” he says.

In order to aid this process, many brands have started sending direct mail along with personalised URLs (pURLs). This is one trend that has been noted by Royal Mail’s recently launched Mail Media Centre (MMC), which aims to showcase the best uses of direct mail and act as a source of inspiration for advertisers and agencies. Antony Miller, head of media development at Royal Mail, is another who believes brands need to get smarter. “Finally they have to sit up and listen, and make that pound work harder,” he says.

By way of example, MMC business development manager Mike West describes a recent BMW launch where key prospects were sent personalised MP3 players with James Bond-style “top secret” messages encouraging them to test the latest model and visit the website and store.

Waitrose is another brand that has impressed the MMC. The retail chain produced direct mail designed to engage with people on a local level, informing them, for example, about the sausages at their local supermarket that are sourced from the nearby area. “It uses localisation well despite being a global brand,” says Miller.

Sadly, the relevance of locality isn’t always leveraged well by brands. Andy Wheatley, strategy director at Tangent Direct, says: “In 2006, Vodafone branded all its stores according to location. This was the first sign to me that a big brand was looking into the idea of locality, but it seemed only cosmetic. We are what we are because of what surrounds us.”

Customer advocacy is another area that only a few brands are really exploiting. This is a strategic mistake, warns GSI’s Davis. “Customer advocacy, and ratings and reviews, can have an incredible impact on confidence in the brand and sales,” he says. “But some are fearful of negative feedback and not proud enough of their products.” Davis uses Toys R Us in the US as an example of a brand that is using customer advocacy to good effect, allowing parents to post feedback and photographs on its website.

At a time when companies are looking to rebuild or maintain confidence in their brands, there’s nothing stopping them enlisting their best customers to help. This is nothing revolutionary: they don’t have to look much further than the information that they hold in-house in order to discover how to please these same people.

Case study: confused.com

Price comparison website Confused.com has used real customers in its ongoing TV ad. According to chief executive Carlton Hood: “They were surprisingly nice. The ad was really easy to do.”

Personalisation, driven by data, is at the core of the brand’s marketing strategy. Embracing the world of Web 2.0, the site includes an option for individuals to submit their own videos. Hood says: “We need to be as fair and as transparent as possible.”

Confused.com communicates to its customers predominantly by email, although it does do some direct mail, and has plans to make use of the mobile channel via interactive platforms. With a database of nearly 10 million consumers, Hood says it’s important to create segmented, tailored communication streams according to factors such as lifestyle and geography.

This process has been easier than it might have been, given that the database does not comprise merely of email addresses. Since car insurance was the brand’s lead product when the site was launched in 2002, there is plenty of rich data on the lives of consumers.

Best price lists are sent to people who’ve bought insurance before, and there is a system of alerts and reminders to help people finish their customer journey. Hood says the aim is to be a helpful service rather than merely reactive.

“We’re proud of our triggered emails. If someone abandoned a quote half way through, we would send them a follow-up email,” he adds.

But Hood warns: “With personalisation you can be too pally. It’s about being quick and efficient. You are a service provider, so don’t pretend to be their best friend.”

Wise words

“No amount of personalisation will change my impression of a bank if it’s just a veneer. Establish trust as a starting point.” Mike Welsh, ceo, Publicis Dialog

“Don’t try to sell me what I’m not interested in. Be true to the principles of DM and ask how can we be more helpful?” Bob Udale, planning director, Archibald Ingall Stretton

“User-generated content is really good for developing transparency. The door is open and you can see in; although some brands would rather that door was still firmly shut.” Matthew Heath, strategy director, LIDA