october 2010

All content copyright © 5one 2001 - 2010. All rights reserved. Confidential.

Vital Health Foods: Vital Vitamins

Targeted Coupon

May Cashback ClubCard MailingPost-Campaign ReportOctober 2010


Contents

• Introduction

• Coupon Redemption & Response

• Incremental Analysis

• Immediate ROI

• Conclusions & Recommendations

2


Introduction

• 150 000 ClubCard customers targeted utilising 5one’s targeting tool

• Campaign period: 3 May – 4 June 2010

• Both Current and New customers targeted:

• 75,000 Current shoppers

• 75,000 New shoppers

• Reward level constructed tested:

• Get R10 off when buying 2 or more Vital products to the value of R80 or more

• Get R5 off any Vital product purchased

• Control group of look alike customers measured over the campaign period

3


The Mailing

4


Contents

• Introduction



• Immediate ROI


5

All content copyright © 5one 2001 - 2010. All rights reserved. Confidential. 6

Targeted Coupon: Redemption

Redemption: customers who bought featured product at the same time as handing in the coupon

How many mailants shopped the promoted products?

• Overall redemption rate is good: 1.7% (above 1% is ‘good’ for Current shoppers, 0.5% ‘good’ for New shoppers)

• Current offers generated an excellent redemption rate of 3.1%

Coupon MailedRedeeme

dRed. Rate

New 75,000 254 0.3%

Current 75,000 2,343 3.1%

TOTAL 150,000 2,597 1.7%


Targeted Coupon: Response

Response: customers who bought featured product regardless of whether they handed in the coupon

A more accurate metric for campaign success as the coupon acts as both a discount and marketing message.

• Overall response rate is excellent: 6.6% (above 2% is ‘good’ for Current, above 1% for New)

• Offer to New shoppers driving 581 new shoppers to the brand

Coupon MailedRedeeme

dRed. Rate

Responded

Resp. Rate

New 75,000 254 0.34% 581 0.8%

Current 75,000 2,343 3.1% 9,248 12.3%

TOTAL 150,000 2,597 1.7% 9,829 6.6%


Contents

• Introduction



• Immediate ROI


8


Incremental Shoppers

CouponMailed Resp. Rate

Responded

Control Resp. Rate

Incremental

Shoppers

% Incremental

New 0.8% 581 0% 581 100%

Current 12.3% 9,248 6% 4,596 50%

TOTAL 7% 9,829 4% 5,177 53%

• Overall the control group shopped at a substantially lower rate than targeted shoppers resulting in a high % of incremental shoppers

• All New shoppers to the brand incremental!

Incremental analysis shows how total mailed responders would have shopped had they not received the mailing – essential in understanding actual effect of the campaign.

How many shoppers were incremental?


Incremental Units

How many more units were purchased?

• Due to high response rate of customers 60% of total units purchased were incremental

CouponTotal Mailed

UnitsIncremental

Units%

Incremental

New 690 690 100%

Current 12,404 7,117 57%

TOTAL 13,094 7,807 60%


Incremental Sales

How many more sales were achieved?

• Total mailed sales of R550k achieved, with 48% sales being incremental

• Nearly half of all sales generated was incremental, and on average an additional R27 per responder gained

CouponTotal Mailed

SalesIncremental

Sales%

IncrementalIncremental / Responder

New R5 R 22,398 R 22,398 100% R 39

Current R10 R 527,675 R 244,226 46% R 26

TOTAL R550,073 R 266,624 48% R 27


Contents

• Introduction



• Immediate ROI


12


Immediate Return On Investment

• Overall ROI is excellent: 433%

What was the immediate ROI of the targeted coupon based on Incremental sales?

CouponTotal

Mailed Sales

Incremental

Sales

Production Costs

Gross Profit

ROI

New R5 R 22,398 R 22,398 R 25,000 -R 2,602 -10%

Current R10 R 527,675 R 244,226 R 25,000 R 219,226 877%

TOTAL R550,073 R 266,624 R50,000 R 216,624 433%


Contents

• Introduction



• Immediate ROI


14


• Overall campaign generated ideal response:

• Redemption rate: 1.7% (2,597 shoppers)

• Response rate: 7% (9,829 shoppers)

• Highly successful at driving incremental behaviour:

• Shoppers: 5,177 (53%)

• Units: 7,807 (60%)

• Sales: R 266,624 (48%)

• Overall campaign generated an excellent immediate ROI of 433%

Campaign Summary


1. Continue to use targeted coupons to invoke re-purchase and gain new shoppers to the brands

2. Test broader offer for new customers (less niched / fewer constraints)

3. In-depth analysis of what the Vital shopper looks like, how they shop across the range and what competitor products they are purchasing into

Recommendations


Thank-you

Nikki Emerton – Account Manager [email protected]

Zakariya Patel – 5one [email protected]

mailto:[email protected]

mailto:[email protected]

october 2010

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