From Cataloger to Multi-Channel Retailer

Industry: 
Multi-channel retail
Key Solution Areas: 
Data analysis, email marketing strategy
Results: 
$500k in saved catalog costs | Annual email-driven sales have outperformed expectations by 2%, a 25% YoY increase | The number of orders increased almost 3.5 times while revenue almost tripled

Evolution of a Legacy Brand

Silver Star Brands, founded in 1934, is one of America’s largest direct-to-consumer companies. Silver Star, formerly known as Miles Kimball Company, rebranded in 2013 to signify its evolution from a mail cataloger to a multi-channel retailer. The company consists of six brands selling gifts as well as health, wellness, and household products: Miles Kimball, Walter Drake, Easy Comforts, Exposures, Native Remedies, and As We Change. Silver Star targets women age 50 and older, reaches 120 million U.S. households, and has a database of more than 24 million customers. 34% of customers order products via mail orders, 34% do so via phone, and 32% via the Internet.

Silver Star Brands had been on a sales and earning plateau for several years up until 2013. In 2014, Silver Star underwent a major overhaul—in less than a year and under budget—that produced an immediate increase in profitability and beat forecasts. By re-evaluating the needs of its customers and market, Silver Star rebalanced its investment into strategies, technology, and people. This revitalization included selecting a single partner, Yes Lifecycle Marketing, to transform its database and email marketing initiatives. 

Yes Lifecycle Marketing’s full-service offering ensured we had technical, strategic, and account support every step of the way. It made a world of a difference that our digital and direct marketing needs were met by a single partner.”

Kathy Hecht, VP of Marketing and Business Development at Silver Star Brands

A New, Customer-Centric Approach

Kathy Hecht, VP of Marketing and Business Development at Silver Star Brands, along with her team, broke down legacy processes and embraced a more customer-centric approach to marketing, thus changing the way promotion and circulation planning decisions were made within the organization. They augmented traditional campaign-centric analyses by introducing new concepts and approaches that focused on customers rather than campaigns. With insights and guidance from Yes Lifecycle Marketing, Hecht and her team were able to determine whether their company was mailing too many catalogs to unresponsive customers. The findings:

  • More than 50% of new Silver Star customers place orders in response to the second or third catalog they receive
  • Less than 9% place their first order after receiving their eighth catalog

What’s more, analysts at Yes Lifecycle Marketing segmented Silver Star’s customer database and isolated a group of nearly 1.1 million customers that each received 6 to 13 catalogs annually and yet hadn’t purchased in over 2 years. Yes Lifecycle Marketing determined this segment represented a marketing cost of $4.6 million, and identified 129k customers (receiving a total of 1 million catalogs annually) whose email addresses were on file as “low hanging fruit.” Silver Star heeded Yes Lifecycle Marketing’s advice and eliminated the catalog mailing for this segment since that wasn’t the most effective marketing channel for the audience.

In addition, the Silver Star team allocated just 1% of the $500k in savings ($5k) to email marketing, thus replacing the catalog mailings with digital communications for the 129K customer segment. Yes Lifecycle Marketing also proposed Silver Star conduct a test to more precisely gauge the incremental impact of catalog mailings versus email communications. The test included randomly dividing customers into three segments to determine through which channels they should be messaged:

  1. Catalog and Email
  2. Email Only
  3. Catalog Only

The experiment revealed:

  1. Adding a catalog to an email stream lifts conversion by 42% and adding an email stream to a catalog increases conversion by 81%. Overall, the combination segment produces the most revenue and total marketing ROI
  2. The “Email Only” segment generates more revenue and marketing ROI than the “Catalog Only” segment
  3. The “Catalog Only” segment yields the highest average order value (AOV), but the results don’t offset the relative underperformance in terms of conversion

Today, Silver Star continues to use models to determine which customers qualify for catalogs. The difference now is that they know better than ever which customers their direct mail investments are reaching, and which customers are providing the best returns on these investments. These new insights have resulted in meaningful, large-scale changes in the way resources are allocated at Silver Star. Instead of wasting money mailing catalogs to high-cost and low-revenue customer segments, Silver Star has redirected (and continues to redirect) resources to its digital strategy, namely email.

Yes Lifecycle Marketing’s Analytics team facilitated our evolution from a cataloger to a multichannel company by uncovering insights and identifying opportunities that allowed us to better integrate our online and offline marketing channels.”

Kathy Hecht

New and Improved Email Marketing Program

Silver Star worked with Yes Lifecycle Marketing to enhance its triggered email program and personalize messages based on customers’ online behavior. For instance, when a customer subscribes to email communications, Silver Star sends her a multi-touch welcome series. This automated email sequence—which was previously a single touch and deployed manually—offers purchase incentives and encourages sign-ups for Silver Star’s rewards program and social sharing, among other things. Nearly a quarter of subscribers open these welcome messages.

Another one of Silver Star’s behavior-based email triggers is based on cart abandonment. If a customer adds an item to her shopping cart but doesn’t make a purchase, Silver Star sends her a three-part email series. The triggers, with an average open rate of about 38%, have enticed customers by extending deals on shipping and building a sense of urgency with each subsequent message.

Similarly, if a customer visits a brand site but leaves without putting anything in her cart, Silver Star may send her an email containing the product(s) she was browsing, as well as a few item recommendations that are pulled in using the company’s in-house affinity model integrated with Yes Lifecycle Marketing’s email marketing solution, Yesmail360i. These browse-based emails boast open rates close to 40%.

These triggered emails are just a snapshot of the many Silver Star enhanced and implemented after working with Yes Lifecycle Marketing. The campaigns ultimately had a profound impact on conversions. For instance, Silver Star’s welcome, abandoned cart, post-purchase, and birthday emails for Miles Kimball that were deployed between January and April 2015 (when the brand was fully on-board with Yes Lifecycle Marketing) outperformed those from the same period in 2014: 

  • The number of orders increased almost 3.5 times
  • The number of orders per click increased by 41%
  • Revenue per click increased by 24%
  • Revenue almost tripled

Silver Star has achieved success not only by executing email triggers, but also by adopting a Yes Lifecycle Marketing-designed mobile responsive email template. This template has allowed Silver Star to streamline the email production process by using flexible modules that can easily be reordered and removed/ added from one message to the next.

All in all, Silver Star’s new and improved email program has enabled the company to beat annual email-driven sales predictions by 2%, marking a 25% year-over-year increase.

Yes Lifecycle Marketing’s digital and direct marketing expertise enabled us to automate triggered email campaigns, eliminate excess spend on inactive customers, and ultimately increase revenue.”

Jennifer Heim Marketing Retention Manager at Silver Star Brands