May 8, 2003, 12:00 AM

Variety in frequency boosts e-mail newsletter responses, Blockbuster learns

Blockbuster tested regular frequency and variable frequency e-mail newsletters and learned that customers like variety better. “Maybe it’s the surprise factor,” says a Blockbuster marketing exec.

E-mail marketing is still a work in progress, but as retailers test various methods, certain practices are emerging. For instance, Blockbuster Inc. began a major test of e-mail last year. Among the techniques it wanted to test were whether customers responded better to regular e-mail newsletters or to variable frequency newsletters. It told half its base it would send the newsletters every two weeks and the other half that it would send the newsletter on a varying schedule, although no more than two or three a month. It included a discount coupon in the newsletters as a tracking mechanism.

Blockbuster liked the idea of variable frequency because it would allow greater ability to respond to events. “We wondered if we could get that flexibility and not impact response rates,” says Michelle Malish, director of CRM programs for Blockbuster.

Six months later, it found the variable frequency produced a higher response rate than the regular frequency. “Maybe it was the surprise factor that got them to respond better,” Malish says.

Blockbuster also tested a coupon that appeared in the newsletter and a coupon that required a click-through. Even though the click-through coupon attained a higher redemption rate, the difference wasn’t large enough to warrant making the customers take an extra step to obtain the coupon, Malish says. Thus Blockbuster presents the coupon within the newsletter.

The main point of the test was to determine if e-mail could be as effective as other media in driving store sales. Blockbuster has been pleased with the results and now incorporates e-mail marketing, using e-mail agency Quris Inc., into its regular marketing mix, Malish says.

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