The challenge

Laithwaites is the UK’s largest mail order and online wine merchant. Despite more than 700,000 regular customers, it’s always on the look out for new members.

Historically it has focused on direct mail, partnerships and press advertising to attract new customers. In 2005 the brand tested TV using long and short-form DRTV and ad funded programing, but on this occasion failed to find a way to match the efficiencies of direct mail or press.

The TV solution

In 2007 Laithwaites was ready to try TV again with a brief to reduce the cost per new customer and create a new high-volume recruitment channel.

The target audience was defined as frequent buyers of wine by mail order, corresponding to ABC1 Males aged 45 and older.

The message of Laithwaites’ great introductory offers was broadcast using a 15-minute infomercial, using material from previous ad-funded programming to reduce costs and running in infomercial airtime on mainstream stations.
The first test cost just £25,000 in September 2007 and ran on a range of upmarket, male biased channels. Calls were directed to a dedicated call centre team and campaign microsite. The results were spectacular with costs down 90% on the previous test and below press for the first time.

The success of this test encouraged Laithwaites to try shorter messages with another low budget trial. In January 2008 a 120-second commercial was used on a range of multichannel stations.

In order to test the effectiveness of the strategy, the brand then took a two-month pause while it waited to analyse the re-ordering behaviour of the new recruits as second and subsequent orders are key to profitability of the Laithwaites business.

The results showed that while the TV schedule was recruiting in good numbers, retention was lower than for customers recruited via other media.

Research showed that while consumers were engaging with the ad emotionally, they were only engaging with the initial offer and not considering the on-going relationship they could have with Laithwaites.
As a result the creative message was changed to highlight the on-going good value offered by the brand and the fact they could get a new case of wine every three months.

A third test in June 2008, based on this new offer and further changes to the call centre script and website information delivered against recruitment, cost per new customer and subsequent purchase.

Results

Since July 2008 Laithwaites has made TV a core element of its marketing mix using more than 20 channels including terrestrial.

After four years of trying to make TV work, the brand has found a blend that generates real business.
Within six months of rolling out the new strategy, TV has become the second-largest channel by volume for new customers behind direct mail and the second most cost efficient both at recruitment and for subsequent profitability.

“Adding DRTV to the media mix has enabled Laithwaites to recruit new customers, that were not being reached by the traditional mix of press and direct mail.”

Mike Colling, Mike Colling & Company