Arizona Republic grows readership with segmentation tool

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The Arizona Republic has increased readership through a database-marketing program that focuses on segmentation.

Despite the growth of the Internet, many newspapers want to increase their print subscriptions. One newspaper is the Arizona Republic, published in Phoenix. The state's largest newspaper, it circulates throughout Arizona. It has been owned by the Gannett newspaper chain since 2000.

"The print provides a nice packaging of the information that would take forever to find on the Web," said Greg Bright, director of data management at the Arizona Republic. "There is a lot of trust in the brands of printed papers. We believe that print is here and here to stay and want it to grow."

The Arizona Republic had always wanted to grow its readership through segmented direct mail, and had used a data anlytics tool that allowed it to do segmentation modeling in the 1990s. However, because of staff turnover and attrition, Mr. Bright said the newspaper lost the people who knew how to use the tool, so the newspaper was not able to do segmention modeling with any sophistication.

"We were left with a tool that was very hard to use," he said. "We joked that a new person coming on board could not do any modeling for six months."

At the beginning of 2002, the company realized it needed a new tool. In 2003, the company started its tool search in earnest by attending rade shows and using the Web as a search tool. The company even went outside the industry to see what other companies were using.

"We wanted a tool where the learning process would be measured in days, and was very quick to pick up, very quick to do analysis work," Mr. Bright said. "We were looking for a speed-of-thought tool."

In 2004, the Republic turned to Denver, CO-based AsTech Intermedia, a provider of data-driven marketing automation services for the publishing industry. Its marketing automation and analytics product, Maxx, handles segmentation, analysis and campaign management. Maxx is delivered to AsTech InterMedia by its partner smartFocus, a management software provider for direct and database marketing.

Mr. Bright said Maxx sits on top of the Republic's data warehouse, which included demographic, psychographic, life-stage and purchase behavioral information. The demographic data is from Acxiom, supplemented with infoUSA data, Geoscape data, county tax assessors' information and PRIZM data from Claritas. Some of the data is refreshed every week, and sometimes every six months, depending on the data providers' schedule.

The tool is mainly used for acquisition-based direct mail for the Republic, Mr. Bright said, and enables it to drill deeper into its targeted audience.

"We can look at anybody in a particular zone, for example, by income, by age or by income and age," he said. "We might find that we have a sweet spot of income and age. This is where the speed-of-thought process comes in - you can change your direction without having to build another model or getting the IT department involved. The answers are almost instantaneous."

As a result of using the system, the Republic can also mail out more personalized, more finely tuned direct marketing pieces.

"Before Maxx, we would send out 100,000 direct mail pieces to the Northeast section of Phoenix, and then a month later, send out another 100,000 to the Northwest section," Mr. Bright said. "Our goal was to not send the same number of pieces out over and over again. With Maxx, we've been able to develop models of who is most likely to become a subscriber as well as who is most likely to remain as a subscriber."

In addition, while the basic concept of the mailings - to promote the newspaper - are the same, the offers may be different.

"One person may be offered a weekend-only subscription, while this person's neighbor may not," Mr. Bright said.

The Republic does seven different mailings per month. A recent mailing included 120 different life-cycle segments, and the Republic used four different versions of creative.

The mailing received better then expected results. In fact since using the new system, the Republic reports double-digit response rates for some targeted mailings, according to Mr. Bright.

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