November 2008

Achieving direct marketing
success with Location Intelligence
Achieving direct marketing success with Location Intelligence.

Identifying and understanding your target customers and finding more like them are critical to refining marketing messages and increasing direct marketing response rates. By utilizing geodemographic data and research, direct marketers can more accurately profile their target customers by taking into account lifestyle characteristics, purchase behaviours and media habits to optimize merchandising strategies and increase sales.

Prospect Media is a Toronto-based marketing services firm for direct marketers in a wide range of industries, including packaged goods, retail, media, financial services, charitable organizations and education. Founded in 1999 by David Maples and Sheryl Sauder, the company provides clients in Canada and the US with innovative, targeted and quality marketing services for optimizing marketing campaigns, increasing brand awareness and driving sales. Its turnkey approach includes a variety of delivery systems, including door hang cards, door hang bags containing sample products, and newspaper polybag programs containing advertisements, coupons and products. The company also distributes flyers and catalogues throughout Canada and the US through its sister company Stratafly.
“When clients come to us with a program, one of their biggest concerns is not wasting product which equals wasted money,” explains Greg Mieczkowski, the firm’s research manager. “In today’s economy, companies need to make the most of their marketing dollars and often, shrinking budgets. It is essential for them to reach the right customers in their target demographic, rather than simply blanketing an entire area.”

The challenge
Traditionally, direct to home marketing relied solely on Canada Post Forward Sortation Areas (FSA) to target client programs. But because this level of geography is immense—containing approximately 8,000 households—the distribution did not allow Prospect Media to investigate “lower-level” demographic and lifestyle characteristics to truly identify which households best fit the client’s target customer profile.

To more accurately identify market potential and deliver the client’s messages directly to the households most likely to respond, Prospect Media began leveraging geodemographic data and research provided by location intelligence company Pitney Bowes MapInfo. Working with PSYTE® Canada and U.S. Advantage, a comprehensive neighborhood segmentation system, and MapInfo Professional®, the company’s flagship mapping application, Prospect Media obtained the tools to more accurately profile its clients’ ideal customers, pinpoint exactly where they live and identify the most effective means of direct marketing to reach them.

Based on the specific client’s preferences, Prospect Media can pick and choose exact variables from a host of datasets to build customer profiles. The neighborhood segmentation tool enables Prospect Media to classify its client’s target customers into “clusters” or unique groups based on demographics, socio-economic and behaviour characteristics. By analyzing location, lifestyle and demographic characteristics, Prospect Media can work with clients to predict consumer product demand and identify new markets with similar traits, thereby helping to increase direct marketing efficiency and ROI.

Based on Dissemination Areas
Using Pitney Bowes MapInfo’s location intelligence solutions, Prospect Media bases distribution decisions on Dissemination Areas (DA), the smallest level of Statistics Canada geography, each containing approximately 250 households. With this micro level analysis, neighbourhoods that fit the client’s customer profile can be identified. “The flexibility of the databases and segmentation system allows us to easily integrate customer POS data or other third-party data, in whatever industry our client may be in, enabling us to service a broad client base,” emphasizes Mieczkowski. “The tools provide us with various options when pinpointing market areas, such as drive time or mile radius, helping to ensure distribution is within the trade are of each of our client’s store locations.”
By custom profiling, targeting and mapping, Prospect Media provides clients with more clarity on specific campaigns they want to initiate. Rather than just viewing data through a spreadsheet, the digital maps bring the data to life, enabling clients to display sales areas and targeted areas to gain an understanding of who their customers really are and where they live.
Door hang bags delivered directly to consumers’ homes are cost effective for clients and allow Prospect Media to track their success through incentives offered to customers who visit the client’s Web site or through coupon redemption. Since implementing a more targeted, geodemographic approach to customer profiling, Prospect Media has achieved 10-15 percent product conversion for door hang bags and door hang cards, as well as 60-85 percent purchase intent by consumers.
“Whether we’re working with clients in packaged goods or travel and tourism, the goal remains the same—getting the advertising message and product into the right consumer hands through an effective means of targeted distribution,” explains Mieczkowski. “Geodemographic data and analysis enable us to more accurately profile our clients’ target customers, helping us develop more effective direct marketing programs that help our clients increase brand awareness and meet sales goals.”