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1、SUBSCRIPTION MARKETINGHow to Leverage Continuity for Greater Rewards SUBSCRIPTION MARKETING/2RRD/MARKETINGSOLUTIONSAs consumers satisfy their needs nearly instantaneously through the Internet,marketers recognize the next big hurdle in revenue generation is keeping the engine running.Enter subscripti
2、on marketing.A modern day re-skinning of the mail order continuity program,subscription marketing serves the willing buyer with a steady flow of consumables and collectibles,wrapped in convenience,value,personal service and delightful surprises.In exchange,the marketer receives a predictable stream
3、of orders and revenue.Some recognizable names in this category include the pioneers,such as The Franklin Mint,International Masters Publishers,Columbia House and Book of the Month Club,but also contemporary businesses like Dollar Shave Club,Birchbox,Blue Apron,Cellars Wine Club,Chewy,OfficeMax,Harry
4、 and David,and Nutrisystem.Subscription marketing programs are more popular now than ever because they deliver six valuable benefits to the marketer:1.Stable revenue,essential for business planning,from inventory to financing2.Reduction of new customer acquisition costs3.Reduction of new customer ed
5、ucation and service costs4.Opportunity for customer advocacy and referrals5.Enhanced understanding of customer wants and needs for new product6.A loyal and receptive customer base for upsell and cross sell The qualifying factor in successful subscription marketing programs is a product or service th
6、at has consistency in definition,is consumable or collectible,and a customer base which wants or needs it regularly.Computers do not qualify;printer inks do.Cremation services do not qualify;diaper services do.The subscription e-commerce market has grown by more than 100%percent a year over the past
7、 five years.In just the past year,15%of online shoppers have subscribed to an e-commerce service.INTRODUCTION1.McKinsey&Company,“Thinking Inside the Subscription Box:New Research on E-Commerce Consumers”15%OF ONLINE SHOPPERS100%RRD/MARKETINGSOLUTIONSSUBSCRIPTION MARKETING/3RRD/MARKETINGSOLUTIONSTWO
8、MODELS OF SUBSCRIPTION SERVICECLOSED-END DEALSSpecific,defined group or series of products that are limited by the term,number of orders,number of units or total dollar value:music collections books home study coursesOPEN-END DEALSContinues until the customer cancels:newsletters magazines and online
9、 entertainment foods and beverages cosmetics and personal hygiene vitamins office suppliesKey Consumer ValueDescription CompaniesSave time and money Replenish the same or similar items Primary categories are commodity items such as razors,vitaminsAmazon Subscribe&Save,Dollar Shave Club,RitualBe surp
10、rised by product variety Receive a curated selection of different items,with varying levels of consumer decision making required Primary categories are apparel,food,beauty productsBirchbox,Blue Apron,Stitch FixGain exclusive access Membership provides access and can convey additional“VIP”perks Prima
11、ry categories are apparel,foodJustFab,NatureBox,Thrive MarketE-commerce subscriptionsSubscribe for replenishmentSubscribe for curationSubscribe for access325513E-commerce subscriptions generally fall into one of three categories.%Source:McKinsey&Company,“Thinking Inside the Subscription Box:New Rese
12、arch on E-Commerce Consumers”SUBSCRIPTION MARKETING/4RRD/MARKETINGSOLUTIONSRetainerAutomatically bills against the consumers credit card or Paypal account on a regular basis,irrespective of the buyers level of usage.The marketer promotes to the buyer in order to extinguish the balance.Auto-RenewA va
13、riation of retainer,in which the marketer automatically bills the consumers credit card or Paypal account in advance of a fixed period of use.Bill MeA pre-or post-shipment event,and is most commonly seen in series purchases.THREE OPTIONS FOR BASIS OF PAYMENTNaked Wines bills the buyer a fixed dollar
14、 amount monthly,accumulating a prepaid balance against which purchases can be made.TurboTax bills consumers in advance of issuing the current tax accounting software.Weight Watchers bills in advance,and then auto-renews at a monthly rate.Examples include gift subscriptions and collections,lawncare,o
15、ffice plants and flower care.$THE HOW AND WHY OF SUCCESSFUL SUBSCRIPTION MARKETINGContinuity programs work for a number of reasons,and can fail when execution levels fall short.Here are some basic,non-negotiable rules to work with:01 The product or service inherently is a series,either of consumable
16、 items or collectibles.02 The purchase plan is easy to grasp and has demonstrable value,either for its uniqueness,convenience,or election at a compelling price.03 The system,including order management,inventory,shipping and customer communication,is fulfilling subscription expectations.04 Customer s
17、ervice is easily accessible,real-time and fast,via live chat or phone,24/7.05 Customer and order analytics are continuously monitored for service issues,customer feedback,order regularity,payments,order changes,cancels and starts.SUBSCRIPTION MARKETING/5RRD/MARKETINGSOLUTIONSDelight&SurpriseShipment
18、s and unscheduled special offers include items that communicate lagniappe(something extra as a bonus,reward or gift).InsightThe best programs generously share information,by way of newsletters,bulletins,whitepapers,blogs,direct mail,webinars and magazines for the purpose of reinforcing a memberships
19、 value.CommunityCommunity members should be invited to join chat groups,Facebook,Twitter,Pinterest,local meetings,conventions and contests.ContactRegular communication from the programs leader is the necessary component in a personal affiliation to a product or service.The leader advances the concep
20、t of community and identity.Email,social media and direct mail letters and notes all support the relationship.The Greater GoodIn some cases,membership implies and supports commitment to a cause,purpose or larger goal that is championed by the marketer,for example disease cures,social welfare and glo
21、bal charities.IdentityTo some extent,a subscription membership is like an association membership.As appropriate to the program,members may welcome a membership badge,in the form of branded clothing,accessories,stationery,gadgets,jewelry,certification,cards,packaging and manuals.SUBSCRIPTION PROGRAMS
22、 ADD VALUABLE INTANGIBLESSUBSCRIPTION MARKETING/6RRD/MARKETINGSOLUTIONSYour best prospects are your current customers.Your next best prospects are somebody elses customers.To that end,look within your own customer files for those multiple purchases,and screen for series sales opportunities.Those opp
23、ortunities may not exist unless you are able to cross sell a new concept.For instance,a one-time purchase of tableware may be the basis for creating a recipe club,a dessert program or table flowers program.To prospect beyond your customer files,you have several avenues to pursue:1.Contact at least t
24、wo list researchers and brokers for their guidance.They will assemble prospect pools made up of known interests:association lists,magazine readers,entertainment buyers,TV ad responders and loyalty club members.Look for email addresses and postal addresses.2.Based on the demographics of your current
25、customers,you can custom select prospect pools from database compilers like Experian,Transunion,Equifax,and Acxiom.Typical profiles include education,income,age,home,marital status,children and car status.3.A third approach is to select prospect lists by clusters of socio-demographic overlays that s
26、egment lifestyles and lifestages.Claritas PRIZM and Acxiom PersonicX are known providers.Beyond these,there are numerous analytical firms that have created new prospect pools based on web-based transactions and browsing.Their reach is broad,but entirely focused on internet activity,which limits your
27、 communication channels and prospect identification.PROSPECTINGSUBSCRIPTION MARKETING/7RRD/MARKETINGSOLUTIONSThe classic continuity program was launched by direct mail.Prospects were presented with elaborate and compelling displays of benefit-laden brochures and letters and samples.Direct MailDirect
28、 mail still retains a corner of this market and is popular among all demographics and ages.Indeed,millennials give more credence to direct mail than they do internet ad placement.Among all media choices,it has the unique power of 100%trackable activity.You know exactly whom you mailed to,and who rep
29、lied.Still,the sales channel is skewed towards older,wealthier consumers,which coincidentally is the domain of subscription marketing programs.Those programs which offer physical samples,and large format printed visuals such as literature,collectibles,art,entertainment,newsletters,home and garden,he
30、alth and beauty are viable,successful subjects in hard copy media like direct mail,package inserts,FSIs and co-op mailers.Direct ResponseDirect response via cable TV programming is a powerful agent.Cable programming is targeted on tightly defined interests,so that continuity programs can be promoted
31、 to smaller,more focused groups than traditional network channels.There are literally thousands of cable channels in the U.S.,and for any of the major carriers,there are at least 200 available to promote your program.Cable provides a controlled release of your comprehensive story,based on the ad con
32、tent.You can start and stop it on a dime.Tracking is one way only:inbound telephone sales and Internet response.You can calculate cost per acquisition,measure timing,but not response percentages.THE MULTI-CHANNEL APPROACHSUBSCRIPTION MARKETING/8RRD/MARKETINGSOLUTIONSWeb-Based MarketingWeb-based mark
33、eting is clearly a vast opportunity for prospecting,via Search,Web ad placement,social media and content marketing.Cookies enhance ad placement,and are the basis for volumes of helpful browsing analytics.On the downside,web-based marketing is challenged by pervasive and relentless bots,which artific
34、ially drive up wasted ad costs.As well,web marketing cannot identify actual visitors who do not authenticate at your site.On the Internet,your market is unidentified until you take an order.An additional downside to web recruitment is the ease at which a visitor can be re-routed by various clicks.Yo
35、u can lose many eligible prospects due to the wealth of distractions available.EmailEmail contact is an accepted and powerful arm in both prospecting and customer communication.It is an essential for most programs,as it continually offers opportunity to educate,congratulate,upsell,reinforce,surprise
36、 and remind your customer.Email also provides a solid platform for response analysis based on e-address for prospecting,and more comprehensive statistics for known customer lists.SUBSCRIPTION MARKETING/9RRD/MARKETINGSOLUTIONSA communication strategy that incorporates a variety of channels will help
37、you reach the right person at the right time.A grandmother of four may personally enjoy browsing through a Babykins catalog,but when it comes to ordering,she turns to the iPad her kids gave her last Christmas.An elaborate newsletter delivers content while a live Facebook page draws us in with a conv
38、ersation.Blow-ins and FSIs stop a magazine reader in mid-sentence,but your uninvited pop-up ad can rile the same person who was reading the news online.Use direct mail as a trigger to send your customers to your website to order.Then,follow up with an email,with a link to your website,to ensure they
39、 received your message and take full advantage of the offer.Marketers must embrace multi-channel to cover the diverse habits of age groups while recognizing the physical laws of browsing:we are everywhere,at any time,and thats where you will find us.MULTI-CHANNEL IS THE RIGHT CHOICELikewise,a writte
40、n thank you note enclosing a VIP discount card gives a lot more traction than a shower of emails stacking up in the“Unread”column.RRD/MARKETINGSOLUTIONSRRD Marketing Solution hosts the largest and most diverse direct marketing production platform in America.You can harness our resources with confide
41、nce:1.Strategic direction in design of campaigns including targeting and creative2.Creative design and copy for acquisition and retention3.Production of hyper-relevant and personal direct mail in small to large quantities with spectacular format arrays4.Postal logistics that improve delivery,timing
42、and reduce costs5.Analytical tools and expertise to test and track winning features6.Email enhancements that support profitable customer communication7.State of the art web-retargeting and bona fide online ad placement to known prospectsBorn out of the mail order industry,subscription marketing prov
43、ides revenue stability and also drives growth rewards going forward.2018 RR Donnelley Marketing Solutions.All Rights Reserved.Optimize Engagement.Visit MS.RRD.comRRD MARKETING SOLUTIONS BUILDS INTERACTIONS THAT DRIVE RESPONSEIf you would like to learn more about the direct mail trends that can improve readership and results,contact us today at 800.722.9001 or .