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How Direct Mail Led to a 286% Return for Chicago-Based Pizza Company
Small businesses are constantly looking for ways to engage their consumer base, as Macromark is well aware. In the restaurant industry particularly, the local consumers that are in close proximity to where the business is located are prime targets that need to be made aware of the menu. Old Chicago is a pizza restaurant chain in the city from which the company gets its name. With their most recent direct mail campaign, and with a little trial and error, the chain was able to garner some incredible results, surpassing any of their previous campaigns in which they used digital formats.
What the owners at Old Chicago determined through a series of surveys was that they were missing out on customers from the higher-level income bracket, namely between $80,000 and $100,000. To address this issue, they sent out direct mail pieces to zip codes that matched those higher-income levels with pop-off tops offering both $5.00 off and 20% redemption codes. The campaign started last October and ran for approximately three to four months.
Though redemption rates were high at about 10%–12%, Darla Bowen, Old Chicago’s director of marketing, noticed a dip in overall business. She attributed the lesser business to the fact that they had tried to cater their menu to the new, higher-income crowd, which ended up alienating their core set of customers.
So to adjust, Old Chicago restructured their targeted direct mail campaign, sending postcards to both higher – and lower-income zip codes, which had different redemption codes on each to assess which group produced a higher redemption rate. When the lower-income group fared better, Bowen focused all direct mail campaigns on them for the remainder of the year. With an 8.5%–10.9% redemption rate and yielding a 286% return on investment, Old Chicago’s latest campaign has been an overwhelming success.
Old Chicago decided to base their campaign on zip codes, which ended up being the right select for their purposes. Being a long-time mailing list broker, Macromark understands the importance of choosing the right select for any given campaign. We offer several select options to our clients and will advise on which ones we feel would most benefit their campaign.
Another takeaway from the Old Chicago campaign is that they showed patience. When their initial campaign didn’t yield the type of results they were looking for, they made adjustments and tried again. What’s important to note is that they looked at the entire scope of their results, having analyzed the redemption rate against the levels of income and how those numbers directly impacted sales. Knowing how to determine whether your direct marketing efforts were effective is important to how you proceed with future campaigns.
Having Macromark be part of your campaign will ensure every aspect of the project is handled in a manner in which we strive to generate the best return for your business.
Source:
Dupre, E., “Direct Mail Helps Old Chicago Make Some Dough,” Direct Marketing News web site, November 13, 2014; http://www.dmnews.com/direct-mail-helps-old-chicago-make-some-dough/article/382949/.
David Klein