New Customer Welcome Programs
By Shari Altman
Five ways to make new buyers feel appreciated—and more apt to buy from you again
Consider yourself as a consumer or business customer making your first purchase from a new vendor, supplier, catalog, store or Web site. You overcame the innate risk of buying from a firm you've never dealt with before—risk that the product will be in stock and appear as expected, risk that what you are purchasing will deliver the value anticipated when you decided to plunk down your own (or your firm's) cold, hard cash. Don't you want to be welcomed and recognized, and know that your business with this new company is appreciated?
Your customers desire no less. But many direct marketers don't even include a thank-you letter after the first customer purchase, let alone a more elaborate offer. Having spent so much money to acquire your new customer, it is distressing to me that so few marketers are willing to take the next logical step by devoting the time to formally say thank you and welcome that new customer into the fold.
Excuses range from, "I just never thought about it," to, "Our retention rate is good, so I didn't think we needed a special welcome." But that's the point—it's a part of the process that is not required, but because it's not necessary it's almost always noticed and paid attention to by customers.
Think of customer welcome/thank-you letters as inexpensive public relations. Everyone likes to be appreciated, and your welcome/thank-you letter puts a positive face on your company to each new customer. Who wouldn't want to make a purchase with a company that appreciates her, as opposed to one that takes her for granted?
Of all the direct marketers I've worked with, continuity marketers most consistently include new customer welcome/thank-you letters and other new customer material, bonus gifts and offers. This makes sense for two reasons:
1. Continuity buyers have the opportunity to deliver very strong lifetime values to the marketer—if they stick with the program through multiple shipments.
2. Continuity programs are more complex and often require some explanation of how the club works, how to change shipment contents, etc.
How Continuities Roll Out the Red Carpet
As someone who's been involved in marketing numerous continuity programs throughout the years, I can't recall a single program that didn't include a welcome/thank-you letter with information on how the club worked, club policies, etc. Most continuity marketers also include free gifts in the new member package as an extra thank you.
An example of this is Cigars International Cigar-of-the-Month Club. John De Marco, vice president of Cigars International, notes that his new cigar club customers get a free cigar cutter and matches, as well as a welcome letter and "how it works" information about the club. Cosmetique, another continuity marketer, goes all out with its new customer welcome material—including testimonials to reinforce the decision the customer made in signing up, an offer to get a gift when a friend signs up, a free shoulder bag (purse) and, of course, "how the club works" material.
Infomercial Marketers Do it, Too
Most infomercial marketers also take the time to include thank-you/ welcome material to solidify a sale. In outgoing new customer shipments ProStrong nail care does this, and not only includes a thank-you letter that carefully reviews what's in the package and instructions on how to use the product, but also a color chart with all the nail polish colors available to purchase. Alexis Vogel Cosmetics similarly includes a welcome booklet that thanks the customer, welcomes her, explains how to organize the products in her initial "kit," draws attention to the separate "get-a-friend" offer in the box, and encourages her to send in a testimonial.
Charles Gay, president of Alcone Beauty, a marketer of professional beauty products available to non-professionals, reports that Alcone Beauty thanks its new customers, continuity or otherwise. In one-shot new customer orders, Alcone delivers a special thank-you letter as well as two or three promotional coupons for other one-shot items. In Alcone's continuity and auto-replenishment club programs, the firm ensures the promotions coupons included are the best deals possible. It also encloses a free, unannounced gift to add an element of "surprise and delight" for the customer. Regarding the results of the promotional coupons included, Gay says, "They're a definite little revenue booster."
In a similar vein, Sara Lee Direct offers $4.95 flat shipping for a second order to every new customer to its One Hanes Place catalog.
Get in on the Welcome Act
So what if you don't already have a new customer welcome program? What should you include as part of your program? Here's a run-down of the possibilities you may want to consider and the benefits to each:
1. Thank you/welcome letter.
- This is a must, and a prelude to anything you do to court first-time buyers. The letter should be written by someone whose identity matters to your customer. This may be your president or your head of customer service. Make sure the tone of the letter is appreciative—e.g., delighted the new customer chose to purchase from you. You also may want to incorporate some basics of how to interact with your company (methods of purchase, how to make a return, customer service hours, etc.). These steps can go a long way to setting proper expectations and eliminating customer frustration later.
- Consider whether you want to use preprinted generic letters or personalized letters. As you might imagine, new customers pay more attention to personalized letters. You may save money by creating a letter/invoice combination form that enables you to have a personalized thank-you/welcome letter for limited incremental expense.
2. Information on other products available for sale.
This can take the form of catalogs or other inserts. Even if you don't have enough products to develop a catalog, educate new customers on the breadth and depth of your product line. This gives them an opportunity to find another item to purchase sooner rather than later.
3. Discount offer for a second order.
A two-time buyer is more profitable and more likely to respond to future promotions than a one-time buyer. Develop a special new buyer offer to ride along with the first purchase—a discount off a second order, a "free with second-order purchase" offer where the "free" item is highly desirable. Highlight the fact that this offer is exclusively for new customers.
4. Unannounced free gift.
Who doesn't love a surprise gift? The gift needs to be something of interest to most new customers. It doesn't need to have a high price tag, but don't give away the lime green wallets no one wanted to buy at any price. An unannounced, bonus gift tells new customers they're dealing with a company that delivers greater value than anticipated.
5. Member-get-member/get-a-friend offer.
When a new customer has received the purchase, it's an ideal time to get the newly converted to extol your virtues by sharing the "find" with a friend. Consider including material for a get-a-friend promotion. Offer a discount or free gift to both the new customer (as a thank you for sharing with his/her friend) and the friend; of course, the offers to each will be different. For example, you could offer a 10 percent discount to your new customer and then extend to the customer's friend the same prospecting offer used to acquire the initial customer.
How will you welcome new customers? Consider your audience, other active promotions, and what is operationally feasible. Like every other aspect of direct marketing, this is an area where testing different options is imperative to finding the best solution for your business. No matter which approaches you choose to take, saying "Thank you" and, "We appreciate your business," always is valued and often rewarded with additional purchases.
Shari Altman is president of Altman Dedicated Direct, a direct marketing consultancy specializing in retention, continuity, auto-replenishment and loyalty marketing. She can be reached at (336) 969-9538, or by e-mail at email@example.com.