ICON Health and Fitness Uses Mobile to Ramp Up Sales
Mobile has helped the fitness equipment manufacturer quadruple the customer product registration data it collects—data that it uses to garner cross-sales.
Often marketers need only a few key data points to grow wallet share. That's why, for ICON Health and Fitness, accurate product registration data is the beginning of a healthy customer relationship. But, until recently, the fitness equipment manufacturer, home to brands like NordicTrack and HealthRider, lacked the accuracy and registration volume needed to make a significant impact on its up- and cross-sell marketing efforts.
The solution to both came from an unexpected place. Nick Palmer, director of ICON subsidiary and fitness equipment warranty provider Universal Technical Services, had been researching UTS's main competitors—insurance companies—when he noticed a trend: Providers were allowing customers to register their service plans and file claims online, instead of having to mail them or call customer service.
Intrigued, he reached out to The Warranty Group, an insurance company and ICON's underwriter, for insight. He was referred to Registria, a SaaS platform provider that was piloting a new tool called Photoregister—a solution that allows customers to register their products by taking a picture of an icon and texting it via their smartphones. The simplicity of the process could help Palmer boost ICON's registration rates. Unlike with a QR code, customers don't have to download an app to use the technology.
After testing the registration technology, Palmer was hooked and decided to implement the solution in November 2014.
Before kicking off a pilot Palmer needed to know ICON's registration rates. So, he crunched some numbers and discovered that its registration rates were about 10%. He then learned from a colleague that ICON entered the registration data—which sometimes contained human errors—into its Salesforce CRM system but didn't use it to market to customers. There was nowhere to go but up.
ICON decided to start small and test the technology on one of its most popular product lines, the NordicTrack treadmill. It also decided to encourage product registrations by offering customers an additional 90 days to their manufacturer's warranty if they register within 30 days.
There are three ways customers can register their treadmill: via email, online, or mobile. ICON uses Photoregister's technology for mobile registrations.
After customers buy a treadmill and take it out of the box to assemble it, they see a layer of film over the console that's used to protect the machine. On that film is the Photoregister logo and an icon, which includes a number that's unique to that specific treadmill. Customers using mobile registration can take a photo of the logo and icon with their smartphone and text it to a short code. Doing so tells ICON the treadmill's model, serial, and version numbers; plus it ensures registration accuracy.
Within about 30 seconds of sending the image, customers receive a text with a link to NordicTrack's online registration portal asking them to complete the registration process. To complete their registration, customers must provide additional information—including their name, email address, home address, and phone number. They're also asked to provide their purchase information, including where they purchased the product, what date they purchased it, and how much they paid. All of this data is then uploaded into ICON's Salesforce CRM system, and the customer becomes a lead for all ICON brands.
After customers provide this information, they can opt in to NordickTrack's communications and finalize the process by hitting “register.”Customers who start the registration process and don't complete it will receive a reminder text to do so.
Once customers hit “register” they're taken to a confirmation page showing that their registration is complete. They're also presented opportunities to extend their warranty, register another product, or purchase similar products.
“[Those registrations are] like an open cash register,” Palmer says.
Customers who choose not to purchase extended warranties are divided into deciles based on retail price, previous purchase behavior, product family, and third-party data, including marital status, education level, race, and house value. Customers can provide some of this lifestyle and demographic data on their own by creating an online profile after they complete their registration. Registria then scores them based on their propensity to buy again.
Flexing its CRM muscle
Depending on their decile, customers will receive an email, a phone call, or a direct mail piece. Customers will receive one of several different types of email campaigns over time. The first email is sent to customers who registered their products but didn't buy an extended service plan. They receive a series of early in-warranty offers. The second set of emails is sent to those who didn't purchase an extended service plan and their manufacturer warranty is ready to expire. ICON will send these prospects a series of reminder emails and let them know that they can still purchase an extended service warranty. The third and final set of emails, which are renewals, follow a similar reminder model.
If a customer hasn't made a purchase within a week of receiving an email, he will receive a phone call.
As for the direct mail pieces, one way that ICON determines who receives them is by factory warranty expiration. The company sends an early-bird offer 45 days before the manufacturer's warranty expiration followed by a last-chance offer 15 days before expiration, Palmer explains. But ICON doesn't send direct mail pieces to customers who have a low propensity to buy again. “When someone goes in to one of our trade partners and buys a $299 treadmill, the conversion rate on buying an extended service plan is so low that...we would lose money by sending them direct mail pieces.”
Pumping out strong results
After testing Photoregister on the NordicTrack product line, ICON has boosted its registration rate from 10% to 38%. The company also drove a $2.2 million increase in service plan revenue over the course of a year. The increased registration data ICON is collecting has provided new insight into customers, such as how many customers make repeat purchases. Another discovery: Customers who buy a treadmill will often buy a lower-end upright bike, too, Palmer notes.
But the company isn't done pumping up its registration program yet. Palmer says he'd like to drive the product registration rate to 40% and that ICON plans to test different calls-to-action to get people to register. Plus, the company aims to roll out Photoregister to its other brands.
It looks like this fitness equipment company's growth strategy is on the right track.
This article was updated on March 7, 2016 to clarify the registration and follow-up processes.