Dipping into an estimated $14 million budget this year for direct marketing, Volvo Cars of North America LLC will break a direct mail effort next week aimed at engendering loyalty with new and old customers.
Owners of 2002 Volvo models will receive a welcome package and existing customers will be informed via a series of end-of-term mailings that their leases are up and how to refinance.
“It creates a lasting relationship, so people will enjoy their Volvo experience and look to buy another one,” said Ron Greene, president/CEO of Euro RSCG Devon Direct, a Berwin, PA-based agency that was recently awarded the direct account.
Each mail effort has a separate look-and-feel in keeping with the tactical objectives.
The welcome package, for instance, is a 9 inch-by-12 inch dimensional mailing. Contents include a personalized letter, customized on-call cards for Volvo customer support that can be kept in the glove compartment, and a color brochure talking about Volvo's driving experience.
Also in the package are a directory of Volvo dealerships in North America and brochures supplying leasing and finance information and accessories. A reply card can be mailed to start a dialogue with Volvo through mail or e-mail news and updates.
Every customer who bought a 2002 Volvo car starting November gets the welcome kit. Greene would not say how many people that is.
The other mailing is first in a series destined for Volvo owners who elect to lease or finance their cars. It will inform customers six months before their lease is up.
That 6 inch-by-9 inch package will carry a personalized letter, a wallet-sized reference card for the pocket or glove compartment and an oversized leasing guide folder for contract information.
“Because their lease is expiring, we want them to appreciate that they can now begin the process of continuing a new lease contract with a new Volvo,” Greene said. “They can elect, through this program, to purchase or lease a new or pre-owned Volvo. Another option they have is they can purchase their current Volvo.”
A second mail package will drop to the same customer three months before the Volvo car's lease runs out.
Besides containing some of the standard elements, this package will include a wear and use evaluator. This clear plastic tool helps monitor the condition of the car for scratches and dents to evaluate the possible charges for dings.
A final mailing to the same leaseholder will go out a month before the lease ends. At that point it is just really a reminder to contact the dealer. A toll-free number is included for customer questions.
The mailings are proof that it is cheaper to keep existing customers than bring in new ones.
“I think that in this environment, it's important to make sure that you don't lose any business and that you retain as many people as possible,” said Phil Bienert, manager of CRM and future product strategy at Volvo, Irvine, CA.
Owned by Ford Motor Co., the Goteborg, Sweden-based Volvo has models like the S60 and S60AWD sedans, the flagship S80 luxury sedan, and V70 wagon and cross-country models.
The automaker is gearing up to launch its XC90 sport utility vehicle this fall. A Web site at http://www.volvoxc90.com is already up, attracting consumers to sign up for e-mail updates. Outbound e-mail has kicked off, though direct mail will break only in the fourth quarter.
In a way, this assignment for Devon signals Volvo's serious interest in direct marketing.
“The program that Devon Direct is handling is something that we started rolling out Jan. 1 and it's a key part of our owner communications program,” Bienert said.
“In the past, most of our direct marketing was done on a project-by-project basis. We didn't have a direct marketing agency of record and now we've been able to consolidate it with the agency handling general advertising,” he said.
Devon is one of seven companies under ad agency Euro RSCG MVBMS Partners, a New York agency that has held the Volvo general advertising account for a decade.
To win the direct account, Devon had to beat out four undisclosed agencies. VSI Holdings, Bloomfield, MI, handled Volvo's owner-loyalty programs it recently downed shutters. VSI's budget for such efforts was estimated at $2 million, according to Ad Age.
Volvo this year is expected to spend an overall $93 million on advertising and marketing, including below-the-line efforts like direct.
“I would say every year direct marketing becomes more important in our marketing mix,” Bienert said.
