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Nailed It: DMNews talks with Mike Mulligan, GM, Safeway Direct Insurance

Mike Mulligan, general manager of Safeway Direct Insurance explains how his company used direct mail tactics to engage the Hispanic community for the first time in the company’s history.

Q What were the campaign goals?

A First, to increase our brand awareness because Safeway had never been sold direct to the customers. We needed to provide instant recognition and credibility to the Hispanic community. We partnered with Chicago Fire soccer club and launched a sponsorship deal with their star player, Cuauhtémoc Blanco. Our second goal was to establish a solid base of Hispanic customers who would provide for referrals and retention. Our third goal was to double our sales volume in year two. Our final goal is to achieve a closing rate of 30%, which we have met.

Q Safeway, in conjunction with marketing consultancy Fuse Msc, turned to Vertis Communications for additional help in reaching the Hispanic demographic. How did Vertis help?

A They provided consumer information, which we thought was very on-target to our customers and what we were looking to do. As they’ve indicated [in their findings], 70% of Hispanic adults who speak Spanish at home had responded to direct mail in the past 30 days. Another finding is that 75% of Hispanic adults make a purchase from direct mail compared to 62% of non-Hispanic adults.

Q How did you leverage direct mail to achieve the campaign’s goals?

A Every one of our pieces that goes out offers a premium on a call for a quote. This can range from a 20-minute phone card to Mexican national soccer team jerseys.

Q What were some challenges?

A We realized many of our consumers who are first-generation Hispanics have no credit cards and no checking accounts; in order for them to complete the sale, we needed to find a way to close the transactions with cash. We partnered with Western Union, which allowed our customers to go to any Western Union facility to make a payment and we would pay the service fee on their behalf. We also opened up a satellite office within the Hispanic community to allow cash payments.

Q What are the results?

A This is a three-year plan. For the first six months, we did one half-million dollars in sales; for the first year, it was over a million in sales. For year two (the campaign launched a year ago), we project more than $2 million in sales … Referrals are a key component to our Hispanic initiative, accounting for 12% of all sales and close at a rate of almost 50%.

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