Culwell & Son Case Study: Building an Email List

We’ve all seen the numbers showing us how email marketing prevails over direct mail in terms of cost savings and timeliness. (If you didn’t believe in the benefits of using email over direct mail, you probably wouldn’t be reading this column, right? But if you need more convincing, see this comparison chart.) So it’s often a goal of brick-and-mortar stores with substantial direct mail lists to get customer names onto email lists.

How to go about doing this?

Here’s how one retailer approached the task.

Email: Less Expensive, More Targeted

Culwell & Son is a high-end men’s apparel store with two locations in the Dallas area. Relying on direct mail (along with newspaper ads and radio spots) to acquire customers, the company had built up a list of about 21,000 names. But the expense — around $80,000 yearly for four mailings — made it obvious that email would be more cost-effective. Plus, using email would have another clear benefit: It would allow for more targeted messages.

“If we could convert these 20,000-plus names into email addresses, I’d write a check for $50,000 because that’s how much it would save in the first six months,” said Mike Culwell, the company’s president.

So a few months ago, the clothier began the work of gathering the email addresses of its clientele. It teamed up with e2 Communications, a company that specializes in email marketing communication and automation. e2 Communications created and runs the back end, while Culwell & Son handles the creative.

The demographics indicated that email marketing would work particularly well with the store’s clientele. The profile of the average customer is a 45-year-old male professional with a large disposable income and, thus, extremely likely to have a computer and Internet access. Culwell says it’s rare these days that he sees a customer who’s not online.

So getting these customers to hand over email address should be easy, right?

Not quite.

Getting the Addresses

Because of privacy concerns, consumers can be wary about handing over their email addresses, so the company set about overcoming this reluctance. And here’s how Culwell & Son turned a common technique into something special.

The store created sign-up cards that were placed prominently at the retail counters. (Note: 65k file.) So far so good. This is a technique other businesses use, and it helped convert some customers.

But the clothier went a step further. For every email address a salesperson gathered at the store, he or she was paid $1.

OK, a dollar doesn’t sound like much. But who minds pulling in an extra $5, $10, or $15 a day? And the results show this incentive is working. Culwell doesn’t know the exact numbers, but he estimates it probably helped double the number of addresses collected.

Why is it working?

Because it turns a task into a game. Plus, it keeps the idea fresh in the salespeople’s minds. And on occasion, Culwell & Son will have special contests, such as giving $20 to the person who recruits the most customers that day.

The Numbers Now

Using this technique and other, online efforts, the database went from about 1,000 members at the end of June to about 4,500 now, and the company’s president is anticipating he’ll have about 6,000 by year’s end. He notes that he hasn’t experienced much backlash from his customers: About 95 percent who are asked if they’d like to fill out the cards do so, and while he didn’t have exact figures for me, he says “only some” unsubscribe.

Culwell estimates half of the database addresses come from store sign-ups, with the other half coming from those who go online and submit their addresses. Each month the company spends about $250 to send roughly 10,000 messages.

And how are those who receive the emails responding?

When individuals sign up to receive emails from Culwell & Son, they are immediately sent a gift certificate for $25 off a purchase of $100 or more. Plus, if they submit their birthday month and day information, they receive a $50 gift certificate (with no minimum-purchase requirements) mailed to them on that day. At last calculation, shoppers who received these incentives spent an average of $264!

And in case you’re still not convinced, consider this anecdote. Culwell & Son ran a two-month promotion this fall on suits and sports coats using email and direct mail. The company did $80,000 worth of business, primarily in the beginning of the promotion, before sales tapered off. With four days left, Culwell spent 10 minutes creating a reminder message that was emailed out to the database, and it brought in an additional $20,000 over those next four days. Culwell says many customers emailed him and thanked him for bringing the promotion to their notice again because they’d forgotten about it.

Ultimately, Culwell said, he would like get every name on the direct mail list onto the email list. But if he could get even 75 percent of the direct mail names converted, he’d abandon the company’s direct mail efforts.

“Email,” he said, “is just that effective.”

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