Puts Its Marketing Bucks Online

Share this content: will spend more of its marketing dollars online than offline this holiday season -- a first in the site's five-year history.

Russ Eisenman, director of marketing and business development at, would not reveal numbers, but said was spending 65 percent of its holiday marketing budget on the Internet, up from an estimated 20 percent last year.

"The reason why I did it is because the advertising proposals that came to me this year were based on realistic things. They weren't based on vapor," he said.

Based in West Sacramento, CA, is the e-commerce arm of Tower Records, a 200-strong international retail chain selling music and video titles. The holiday effort is a three-pronged, segmented campaign through Dec. 19 using Annuncio software. Targeting music collectors ages 25-34 -- slightly older than the typical online music consumer -- will send more than 30 million e-mails, 600,000 catalogs and run 25 promotions for online sales.

"This is the year we're really testing the response rates from specific marketing programs," Eisenman said.

Profitable customer acquisition is one of the aims. Eyeing portals for traffic, has opened stores in Yahoo and AOL's shopping areas. The e-mails and catalogs along with print, television and radio ads will seek to drive traffic. For retention, the retailer is using a mix of e-mails and direct mail. Customers who have not bought from for the past 90 days will receive follow-up e-mails using Annuncio's software.

"We'll be able to track enough people who have purchased through our direct mail catalogs and we'll be able to identify the customers who have purchased," Eisenman said.

Consumers who have not purchased will be e-mailed again, reminding them of the special offer sent in the original missive.

Another effort is the Top 1,000 Customer campaign. has sent e-mails to its best customers with $10 offline store credits already included in their accounts.

Like many online retailers, wants to promote its site as a destination for the purchase of music, video and DVD gifts. Hence, selection and discovery of new music comes to the fore. Creative messaging in all marketing material stresses this point.

"The overriding call to action is simple use in ordering and fulfillment -- you buy it and it's delivered right to your door," Eisenman said. "We've tailored offers based on customer segments. Most of the targeted offers are based on purchase behavior and come with free shipping and gift wrapping and, in some cases, dollars off."

Competition is another issue addressed by this campaign.

"I'm trying to identify new brand positioning points away from pricing," Eisenman said, "because that's what online stands for in so many years. Through all the research we've done, price is always the No. 1 thing the customers say, and we're trying to step away from that and to really focus on what Tower's been doing for 41 years [since the first store opened]." accounts for nearly 5 percent of Tower Records' sales.


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