After test program, Ford rolls out more relevant direct mail strategy

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Following a test earlier this year, Ford is launching a variable data print strategy for its direct mail program that will result in consumers receiving more than 1 million pieces of relevant mail annually.

The automaker is rolling out the program across its entire portfolio of extended service products, a process it expects to complete in the next six months. Ford hopes the more than 1 million pieces of annual direct mail will result in "an increase of tens of millions of dollars" in sales, said Mark Bardusch, national sales and marketing manager of extended service business at Ford.

Faced with 1% response rates a year ago for its direct mail promoting extended service plans, Ford searched for a better way to communicate with its existing customers via the medium.

“We were doing a mediocre job of giving customers a reason to pick up the phone and call our experts,” Bardusch said. Ford has added some basic personalization in its direct mail, such as the customer's first name and vehicle, in recent years.

Working with direct marketing services provider and digital printer Budco and the Xerox 1:1 Lab, Ford developed a test to compare the effectiveness of its existing direct mail messaging against a mailer that, while virtually the same from a creative standpoint, inserts data and images relevant to a specific recipient.

To accomplish this, additional data was pulled from various Ford divisions that maintain detailed databases on customers, including demographic information such as age, income and gender.

“We looked really hard at how we could connect that data with the right messaging about the different reasons why having an extended warranty is important to different customers,” said Jeff Sierra, VP marketing and product development at Budco.

This might include images that reflect if the recipient has a family or references to the car owner's home town, for example. Between the personalized images and additional data, there were approximately 40,000 possible data combinations to produce each mailer. The mailers were printed on a Xerox iGen presses.

The test ran from November 2008 to February 2009 and included a universe of more than 20,000 Ford F-150 owners who were nearing the end of their factory warranties. Recipients received either letters or self-mailers with basic or enhanced personalization.

The results from the campaign included a 5.7% overall increase in response rate and 35.7% increase in sales penetration, or the number of recipients who purchased an extended warranty afterwards.

“One of the key reasons for the success of this campaign is that the personalization allows the customers who call us to know that we can design something that best fits their lifestyle,” said Bardusch.

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