Mail Unleashed Transcript

Rory

Hello and welcome to Mail Unleashed. It's a series of films in which we talk to leading practitioners and senior marketers within the industry about their experience of discovering the magic of direct mail. The stories around their two favourite mail packs and other things which happen to come to mind. And today I'm delighted to be joined by something of a guru in the field of loyalty in the person of Natalie Milner, who, after a career, both agency side and client side, is now both group membership and loyalty director at the AA. So, Natalie, huge welcome.

Natalie

Thank you. Thanks for having me.

Rory

I'm intrigued to know which are the two packs you brought today.

Natalie

One from Wickes, which was my first client-side role. That was part of a loyalty program statement and a second, which I had nothing to do with, but love from Loaf.

Rory

Aha. Okay, start with Wickes, which is a bit of a cult brand for me. You were there for about four years, is that right? And it was your first loyalty job?

Natalie

I was there for a little longer than that. I joined as head of CRM and Loyalty, and then went on to be a digital director. And we launched the loyalty program, My Wickes Card. Which was. Which was hugely successful and perhaps one of the only times I've seen in econometric modelling the results of DM.

Rory

And so what were the properties of the card when you launched it?

Natalie

It was a points-based retail loyalty programme. So there was automatic earning and then we burnt those points initially through discount vouchers, that we sent out on a quarterly basis. So we auto-redeemed the points for people and converted them to vouchers and sent them personalised offers as part of a pack.

Rory

And so I think we can probably say this after these years, what was the sort of percentage take up? Did you offer it by direct mail or did you offer it in-store first and then use it as the basis of it?

Natalie

It was in-store first. So at the time, Wickes had no customer data.

Rory

No.

Natalie

It was when the word omnichannel was first emerging and being used. And so this was a great way to get to customer data. And we had an extremely rich base of data that we were able to leverage and use within this and ongoing programmes to huge effect.

Rory

And so, I mean, that was interesting because, I forget this, there was a period where, particularly for retailers, they were absolutely panicked by the fact that, you know, they wouldn't necessarily have the data that you know other people might have. The other advantage, of course, with any card of that kind is it really allows you not only to incentivise and to promote, but also to measure to a real level of absolute precision in the sense that, you can see the long-term effects regardless of channel.

Natalie

Absolutely. And any kind of loyalty program requires investment. And often there's investment that sort of returns over the long term with capital investment and systems and so forth. What was great about this was the measurability. So we were able to use really robust test and control methodology and see incremental uplift, particularly around these rewards statements, which won a couple of awards and I was quite proud.

Rory

Because I think sometimes direct marketing in general, but particularly direct mail tends to undersell itself. In that it measures success only in terms of the extent to which a communication achieves the end. It's specifically designed to do in the short term.

Natalie

Yes. I think measuring over the long term, so customer lifetime value is ultimately. You know. And understanding how you get to that. But because we had high volume quarterly statements that delivered these rewards and targeted promotions at quite high volume, we would see and be able to see that spike in the econometric model when they were redeemed.

Rory

So you could actually it that when the quarterly mailings went out, there was an absolutely clear attribute spike.

Natalie

There was a spike in econometrics. Yeah. 

Rory

So tell me about the Loaf mailing as well.

Natalie

Yeah. So this is one I think is a great example of how you can build a brand using direct media. And in fact, it's only very recently that Loaf have started an advertising campaign and prior to that they were they were using direct media, they were using press. What I really like is the creativity in these little packs, the way they’ve thought about providing something useful to you.

Rory

I think that's another point about physicality, which is we've made before on this very talk, which is the whole thing of time, which is we referred to the toast rack effect, you know that you quite often keep direct mail and act on it at a moment of your own choosing, whereas that doesn't really apply to most other media you're exposed to.

Natalie

And I think that's the way I would look at mail as part of the communication mix. What's the mindset of the person when they are consuming that media? If you will? Where might that opportunity be then to influence them at different points in the purchase decision journey. And of course, you know, gone are the days of junk mail where we had so much post coming through the door, we didn't pay attention to it.

Rory

So with the AA, of course, you have this fantastic, venerable, kind of, member organisation. Which I suppose sells insurance of all kinds combined with or independent of breakdown. But you're still presumably quite a heavy user of direct mail at the AA?

Natalie

Absolutely. Our customer base actually skews a little older, as you might expect, and we have some limitation on the amount of email addresses that we have, that we've collected over the years. So we are a heavy user of DM, for two reasons. One, necessity. Right, but also we're sending out welcome packs. And I think there's a real opportunity to send something that's important of value at the beginning of a relationship. To establish that with somebody. So, yeah. 

Rory

Natalie talk about the importance of a holistic view in terms of media selection I’ve always worried slightly that the use of metrics, ok. And you can only use so many metrics, reach and frequency, etc. and cost per x, the use of metrics will always victimise what you might call ‘outlier media’ because, you know, the virtue of direct mail is patently not reaching a large number of people very cheaply. But what it makes up for that is impact or you could, actually say kind of decisiveness, you know. You know, it actually it creates a crux of decision making in a way that most media don't. And that's probably the heritage of the fact that, you know, historically mail was something you had to respond to or at least consider.

And I’ve always thought radio falls victim to that same thing. It sort of just, it can unfairly fall off the schedule because those kind of media, which are disproportionately strong in one particular area often get actually penalised by the kind of metrics which are necessary for comparison and justification but don't necessarily lead to great decision making. And you talked about the thing about holistic media selection. I mean, I suppose Loaf would be a good example of that, wouldn't it? The piece you've chosen?

Natalie

Absolutely. And that was one of the reasons I chose it, in fact, because I think what they do very well is think about the unique properties of the media they're using and creatively choose their messaging and appropriately choose their messaging for that media. So you can have a, join up and have a weekly newsletter sent through to you by email. But you get something very different if you opt to receive their brochure through the post. And I think they do a very good job of thinking about how you were in a different mindset at that point in time. You want small consumable content in your digital newsletter and yes, you might click through and browse on the website, but you're going to have much more attention and time when you receive that little brochure through the post.

Rory

And with the AA you still plan to use direct mail. You mentioned the importance of physicality with membership. There's a little bit of me which thinks that actually until I've actually touched something with a brand on, I'm not 100% convinced it exists. You know there's that value to tangibility. What, Similarly with Wickes, I imagine you found that paper. I mean, now there'll be huge pressure on you at Wickes to digitise the whole programme to have people come in with smartphones and display a barcode.

Natalie

Inevitably.

Rory

Yes. That wouldn't necessarily be a great decision, It's sometimes a false economy, isn't it? I suppose.

Natalie

Yeah. I think the, you know, from the Wickes example, we needed a physical card, as an identifier to attach the customer to the transaction and have that rich data in the background. And of course apps, have taken that over with the digital loyalty card in a retail environment. For a brand like the AA though, I think there is a difference in that, you're not transacting every day, you're not going and buying something. Every week. There's an infrequency of usage and even if you have breakdown cover, or an annual insurance policy, you're renewing it once and the minority of people are breaking down and needing to use it. So I think there's an importance on thinking about how we make an impact and how we can engage with members during that year where hopefully they're not having to phone us up and make use of the thing they've bought.

Rory

I also think the idea of membership and to some extent loyalty might be bizarrely heightened by the fact that online gives you access to such a ludicrous proliferation of choice. And in many cases, I think consumers are looking for choice reduction. Can I just have one person who takes care of all this stuff for me under one roof? Actually, economists always thought that effectively the Internet meant the death of loyalty, because instant price comparison simply meant that everybody would just turn transactional. I suspect, that not the first time economists have got it wrong that we may actually see the opposite.

Natalie

Yes, I agree with you. I think, of course, you understand that people don't make rational decisions actually. We're not making logical decisions. We're making decisions based on how we feel, based on emotion. And I think that's the that's the key from a loyalty point of view. Does direct mail have the opportunity to make you feel special? To make you feel valued. Yeah, I think it absolutely does.

Rory

You wouldn't invite someone to your wedding by email. No. Okay. Effectively it says you are part of a select group because we wouldn't be writing to 10 million people.

Natalie

Absolutely. So any brand looking for those little opportunities to demonstrate the fact that you're valuable to them is going to really resonate on an emotional level.

 

Rory

So, Natalie Milner, thank you enormously for joining me on this edition of Mail Unleashed. And just to those of you watching, if you'd like to find out more how you can unleash the magic, and power of direct mail, you can find out a great deal more if you go to marketreach.co.uk. Thanks very much and see you next time.