Do Communications Change Behavior?

The Air Miles reward program is Canada’s largest coalition loyalty program. Over 60 percent of Canadian households have enrolled in the program for free. Under this program, members earn Air Miles reward miles by buying goods and services from a variety of merchants. The Air Miles for Business program allows members to earn reward miles on their business purchases as well as their personal purchases as consumers. In the spring, the Loyalty Group, the creators and managers of the program, offered bonus reward miles to Canadian farmers in a direct-mail campaign urging them to buy products from such merchants as United Grain Growers, John Deere Credit, AgLine, Shell, and Goodyear.

Maria Wallin, marketing manager at the Loyalty Group, arranged for a direct-mail piece to be sent to 50,000 western Canadian farmers who had been active in the program in the 14 months prior to the campaign. In addition, mass media ads for the campaign were placed in six farm publications in western Canada. The goal of the campaign was to achieve a direct-mail response rate of 5 percent and to encourage 2 percent of those contacted to make purchases at one more farm merchant than they had used the previous spring.

Air Miles for Business turned to OgilvyOne Worldwide in Toronto for strategic and creative development of the mailing piece, and to Symcor Direct Response for the laser and letter shop production. Using the Air Miles member database, they developed 72 different combinations of letter copy and 2952 certificate sheet combinations, completely driven by past purchase behavior. The offer of bonus reward miles was designed to encourage increased spending during the promotional period. There was an additional incentive for each farmer to visit one merchant whom he or she had not visited the previous spring.

A control group of 10,000 western Canadian farmers who were members of the program but did not receive any mailings was set aside. The success of the campaign was measured by the overall response rate, the number of farm merchants used, and the number of reward miles earned by those who received the mailing versus those in the control group who did not. The result was that 12 percent of the mail universe responded to at least one of the offers, more than double the first objective. In addition, the number of reward miles earned by those who received the mailing was 59 percent higher than the number earned by the control group during the period of the promotion. The same test had been conducted in the previous year. At that time, the mailing had produced a 46 percent increase over the control.

The second objective was also achieved, as 6 percent of the mail universe made purchases at one farm merchant that they had not used during the previous spring. However, while the objective was achieved, the average number of farm merchants used was the same for the mail and control groups. So, what can we conclude from this? You can successfully use direct mail to get people to do more of what they are already doing. It is much harder to get them to do something different.