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May 2007
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Results Suffer from Static

IT HAS become commonly accepted that adding variable data to a direct marketing program significantly increases response rates. However, a true control group has often been missing from the evidence cited. Results are typically compared to previous mailings or industry averages, not a static mailing with the same design and message.

Alerus Financial, a North Dakota-based banking institution, decided to include very systematic testing as part of its first application of variable data in a program designed to obtain new loan customers. The company wanted to compare variable data marketing to static methods and establish a baseline for its future marketing efforts.

[ The Proposition ]

With interest rates rising, Alerus noticed a decline in the number of credit card debt consolidation loan applications that it was receiving. For several years, the company had discussed offering pre-approved customer loans to a targeted group of customers and prospects, but it had yet to put the plan into action.

Alerus’ marketing manager had been talking with nDialogue, a direct marketing firm, about the option of doing a variable data campaign with a personalized URL and tracking. To enable a comparison of the results from a variable data vs. static mailing, nDialogue recommended dividing the pool of 7,500 prospects (provided by the financial firm) in half, choosing the names at random.

[ The Solution ]

The first piece sent was a variable data self-mailer that contained a personalized URL (PURL) for each recipient. People who didn’t respond to the initial offer were then sent a print-on-demand postcard with a different set of PURLs. nDialogue tracked phone calls, visits to each landing page, submitted contact forms and click-throughs.

The target audience was segmented via age demographics into three ranges—25-35, 36-45 and 46-55 year olds. The creative team at nDialogue created personalized messaging and images designed to appeal to the core needs of each group. At his or her personalized URL, a respondent discovered more information on the credit card loan consolidation offer, was able to submit an auto-populated contact form, and use an interactive calculator on the page to estimate their monthly loan payment.

Because Alerus had not used tracking mechanisms for its previous direct marketing efforts, nDialogue created a test segment similar to the kinds of mailings the financial institution had done in the past. This static program involved sending one self-mailer that employed the same creative used for the middle age group of the variable data segment. The same offer was made to the static and variable data segments, but only a single toll-free number was offered as the response device.
 

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