The Data Challenge
How custom segmentation helps The San Diego Union-Tribune find new subscribers
Like at all major newspapers, it has become harder and more costly for The San Diego Union-Tribune—the second-largest newspaper in Southern California—to find new subscribers. To develop marketing and sales plans to approach consumers differently based on their lifestyle and circulation habits, the marketing and circulation team at the Union-Tribune determined it needed to develop a custom segmentation system.
Two recent business changes helped propel the marketing and circulation team’s challenges. The first change was internal: The Union-Tribune recently started to promote four-day and Sunday-only subscriptions; previously only seven-day subscriptions had been pitched actively. While the new offers were successful in acquiring more four-day and Sunday subscribers, some of its acquisition efforts were achieved at the expense of seven-day subscriptions it might have sold. Realizing this, the Union-Tribune wanted to identify prospects most likely to sign up for the different types of subscriptions and approach them with the right offer.
The second big impact to new customer acquisition was external: the Do-Not-Call Registry, which took effect in the fall of 2003. Like most newspapers, the Union-Tribune relied on telemarketing for the largest percentage of subscription starts. To offset the impact of a do-not-call list, the Union-Tribune needed to identify best prospects for other direct response acquisition channels such as direct mail and door-to-door canvassing.
To leverage its investment in Claritas data metrics, the Union-Tribune partnered with Integras, the analytical services division of Claritas Inc., to build a custom segmentation system.
A needs assessment determined the newspaper’s custom segmentation system would require a hierarchical framework that could be used for different applications. Strategically, it was important the system have a small and manageable number of consumer segments that could be used for messaging and positioning. For more tactical day-to-day applications such as acquisition, retention, upsell and re-activation, a larger number of more discrete segments would be needed.