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Apr 29, 2014
Case Study

Email Marketing: 300% conversion rate increase for Sony Rewards using consumer data

SUMMARY: Sony Electronics wanted to drive acquisitions for the Sony Rewards loyalty program for Sony's credit card, and leveraged internal data to accomplish this.

In order to reach influencers and those most likely to be influenced, Sony also added customer interaction data to drive a 300% increase in overall conversion for the Sony Rewards loyalty program.
by Courtney Eckerle, Manager of Editorial Content

"The [Sony] Card helps deepen the relationship and engagement between a Rewards member and the Sony Rewards program," said Aashish Rangwalla, Senior Manager, Acquisition Marketing, Sony Electronics.

Sony Rewards is a rewards and loyalty program that cuts across the entire Sony universe in the United States, and points can be redeemed for more products and experiences.

As customers interact with various Sony products, whether it be electronics, the PlayStation brand or movies, they have the opportunity to earn Sony Rewards points.

"It is very similar to if you think about a frequent flyer program for an airline or a frequent stay program for a hotel," Rangwalla explained, adding, "customers can then redeem for Sony products and experiences and things related to various Sony entities and content — things like movie premieres [and] backstage passes to concerts."

CHALLENGE

Running the loyalty program for the card marketing services group, ensuring customers sign up for and continually interact with Sony through the rewards and loyalty program is the team's main concern.

In terms of organizational roles and responsibilities at Sony, Rangwalla leads the credit card acquisition team within his group.

"So basically, my team and I are tasked with working across the Sony ecosystem to market the credit card in all of the relevant places and the right places and to help drive new credit card account acquisition," he said.

Rangwalla and his team were facing two challenges at the beginning of this campaign. Due to United States banking rules and regulations, a bank has to be the issuing entity for a credit card.

"So in our case, Sony certainly is not a bank, at least not in the U.S. So we don't issue the credit card," he said, adding that Sony's partner bank is Capital One.

With all of the team's campaigns, Rangwalla has to work for cohesive buy-in across the two companies.

"I certainly work with all of my colleagues across the Sony universe within the U.S. to market the credit card, but on the flip side of that, I work very heavily pretty much on a minute-by-minute basis with my colleagues and partners on the Capital One side to make sure that we're working together as one entity, one unit," he said.

The final challenge was "not necessarily list fatigue, but we wanted to drive cost-effective acquisition," he said, but added that list fatigue was part of the team's broader concerns in pursuing greater acquisitions.

Since the target group of this campaign was Sony customers buying various Sony products, the team needed to be mindful when embarking on this email campaign to not have any kind of negative brand implication.

"Certainly within some of each channel like display or email, there really isn't a direct cost of marketing … [but] there are technology costs. But it's not like direct mail, where you're paying to basically send every piece of mail out the door," he said.

With that in mind, the team needed to be proactive in ensuring the campaign was calibrated correctly.

"We certainly don't want them to be turned off to the brand because all of a sudden, they're getting blasted with credit card solicitations from Sony. … We didn't want to do anything to damage the relationship between the brand and the end customer," he said.

Rangwalla added, "As you can imagine, like any good marketers, my team and I basically were working to figure out how [to] overcome these challenges. How do we make sure that these challenges don't inhibit our ability to achieve our goals and objectives related to credit card acquisition?"

CAMPAIGN

Rangwalla works with the PlayStation brand, to send credit card solicitations to that base, and with Sony Electronics, on the e-commerce site for Sony's store.

"We market the Sony credit card as a way for Sony enthusiasts, Sony loyalists, Sony purchasers to get more from their purchases by signing up for the credit card. There is certainly an incentive that is used, but they're able to earn rewards points for the purchases that they make," he said.

Within the company's sphere, there are a finite set of ways to reach and market to the end credit card prospect, according to Rangwalla.

"We certainly have our tried and true channels that we use and that we market through, but I was also looking for other ways, other channels with which we could market to people that may be interested in a Sony or PlayStation cobranded credit card," he said.

The team decided to embark on a precise, data-driven email campaign — managing data they had never fully utilized.

The approach was twofold, with an effort geared toward influencers in the customer base, and then focusing on people who are open to peer pressure — the influenced.

What the marketing team did was examine the existing cardholder base and from there, identify individuals within the existing credit card base who are considered influencers.

According to Rangwalla, the influencers were "those people who others listen to, or those people who others take trends and cues from as it relates to lifestyle choices and decisions about anything from credit cards to what movies to go see," he said.

The campaign that was implemented was a member-get-member referral email campaign using an influencer scoring, comprised from Sony's existing data and social media data collected on customers by a vendor.

Step #1. Gather relevant data on customers

"The way that it works within the Sony ecosystem is we certainly have data on our customers — how they interact with the Sony brand, what they're buying," Rangwalla said.

The one data challenge the team immediately faced was that not all of Sony's customers interact directly with the company.

"Someone can usually walk into a Best Buy or go to Amazon and purchase a Sony product, a TV, a camera, whatever it may be, and if they never register that product, we at Sony don't know that they bought that product," he said.

Unless the customer registers the product they bought from another retailer or purchases directly from Sony, they do not have direct interaction and a data connection.

However, Rangwalla said the company has enough data on customers in its list to pursue the campaign with customers who interact directly with them as part of gathering points for Sony Rewards.

"If you think about Sony Rewards on the whole or even the Sony ecosystem, absolutely. That's part of what the Sony Rewards group and the loyalty program is all about. Creating that engagement, creating that interaction between Sony customers, Sony loyalists, Sony enthusiasts and the brand," he said.

The data gathered on existing cardholders to inform the campaign included:
  • Purchasing history (preferred products, purchase frequency)

  • Interactions with Sony

  • Preferred channel of interaction

  • Prospect data

As an example of the specific data that Sony Rewards gathers that can be utilized, Rangwalla described a customer who earns points by uploading a picture of a movie ticket stub from a film released by Sony Pictures Entertainment.

"By them doing that and earning points, we at Sony learn that Carol just went to see this particular movie, or Courtney just went to see this particular movie. It's because you raised your hand," he said.

Just like most organizations out there, he added, Sony strives to consistently have a very robust understanding of interactions with customers.

Now the team needed to understand the interactions customers were having amongst themselves.

To accomplish this, the team then enlisted a vendor to connect the internal data with information from thousands of open data sources, used to identify real customer connections.

Connection types included:
  • Place of residence

  • Schools, colleges and universities

  • Professional activities, like co-presenting at a conference together

  • Travel, dining out, shopping together

  • Social media activities, like sharing photos

By integrating this data, the team was able to determine "not just what happened within the Sony ecosystem, but how these individuals are behaving, how these individuals are connected to other individuals in the world, in the social graph," he said.

In connecting the two, Rangwalla said the team was trying to "further our business intelligence … by augmenting that understanding and that intelligence with what's happening in terms of interactions amongst our customers and those interactions that happen outside of our ecosystem."

Rangwalla said his takeaway from this part of the process was looking at "all these ways you should be leveraging and could be leveraging this information to drive better ultimate results and better meet your objectives."

The team decided to use this data to determine who the influencers were, as well as to discover those who were susceptible to peer pressure in order to drive conversion.

Step #2. Focus on influencers

After collecting the needed data, the marketing team worked to test a program focused on influencers in the customer base.

Before embarking, given the strong partnership with Capital One, the first thing Rangwalla needed to do was "socializing the idea and aligning with them," he said.

Adding buy-in on that side and making the case of what the value and potential ROI were in this campaign was a pivotal step.

Starting at the top of the funnel, Rangwalla said the team first considered how many cardholders were currently in their base, and went through the process of ensuring that any needed suppressions were made.

They worked their way down to see "who within that base we can actually contact for this referral campaign."

From there, looking at the existing and current lists of credit card holders, the team went through the process of ensuring that any suppressions for honoring opt-outs due to non-contactability or for other reasons were applied to these customer sets, Rangwalla said.

They also applied filters to customers who hadn't met minimum purchase thresholds, focusing instead on garnering more optimum consumers.

"After all those various suppressions were applied, we had a core set of customers," he said, from which social data was gathered and connected about to generate a list of influencers that had "the greatest ability to amplify their use of the Sony Card."

The team then used this core set of customers for an email send.

The email encouraged the recipient to "Refer friends to the Sony Card!" and had two calls-to-action of "Refer Friends Now."

The central copy of the email featured two graphics detailing how the cardholder could receive up to $250 in rewards themselves, and $100 statement credit for any friend referred.

Test to verify

The email was segmented and sent out to two groups: the influencer list and a randomly selected group from the regular list consisting of customers that were not identified as influencers.

"We marketed to them in the same exact method, the same exact offer, and then compared the results and saw that 2.8 times lift for the influencer base segment versus the control segment," Rangwalla said.

Step #3. Target the easily influenced

With the success of the first test on influencers, Rangwalla and his team decided to use the information to find another channel to target in driving credit card acquisition.

"It's almost the inverse of an influencer. It's actually who is under peer pressure," he said, meaning those people that are more likely to listen to other individuals, or take cues and advice from other peers.

Rangwalla said this development in the campaign was natural to capitalize on how humans interact with one another.

"In terms of a lot of advice, I turn to my father … he's a good sounding board for me. He's retired, he reads a lot. He's a wealth of knowledge that I tap into," he said, explaining that "by that definition, I'm under 'peer pressure' from my father because I tend to listen to what he says."

To identify more easily influenced prospects, the marketing team used the same data to identify customers who had recently purchased a Sony product. Then, they identified other customers in the customer's "friend network."

Using a combination of Sony ecosystem and social media data, the team was able to connect a customer who, for example, had just purchased a Sony camera, with someone in their friend network who had purchased the same, or a similar product soon after.

"There's a high degree of probability that these two individuals are friends and they were talking. When the first person bought the camera, they likely shared how great of an experience they had using that camera, how much they loved it. That influenced that second individual to go out and get that camera, too," Rangwalla said.

How that relates and translates into Sony's marketing is the ability to take "our regularly scheduled email campaigns and apply a peer pressure propensity model," he explained.

Previously, the team was using large lists of prospects and customers they wanted to market to and "we weren't being all that judicious. We certainly weren't necessarily marketing to everyone, but we were just marketing, not applying any kind of targeting or segmentation," he said.

The team tested out the email campaign again, this time with the peer pressure propensity model, against a non-targeted or targeted list.

This test garnered a 380% lift in response rate, and even though it was the outcome the team was expecting because of the first test, "the percentage lift was very surprising and very favorable."



RESULTS

Since running that test, Rangwalla said, "We've pretty much instituted [the] peer pressure model as well as just a typical response model into all of our email marketing with several of our business units," and more are set to adopt it soon.

The results this campaign was able to achieve through data targeting were:
  • The influencer send saw 2.8 times lift against the non-influencer list

  • The peer pressure send saw a 380% lift in response rate against the non-influencer list

  • Prospecting campaigns saw a 300% increase in conversion

The team was able to meet their goal of reducing volume while increasing influence — email campaign volume reduced by 30%.

One result of the campaign in targeting influencers was even though the team saw a significant lift of almost three times the control, it was within a very small population.

"So though the [influencer test] worked, and it proved itself from a business perspective … we were not able to really move forward with it because the numbers ended up being so small and it just doesn't end up being worthwhile. So it didn't scale as well as we hoped it would," Rangwalla said.

With applying various suppressions, the team was left with a small population from within their larger list to find influencers. After applying response rates and conversion rates, the actual number ended up being not worth doing a follow-up campaign as of yet.

"It's on the radar. We know that it works, which is good. We just need to make sure that we've got enough of a critical mass before we revisit that campaign. I'm hoping we can do that later this year," he said.

From the overall campaign, Rangwalla said his takeaway was for the team to continue to "push the boundaries of how we think about the power of various products and the power of what [we] can do with various data."

Going forward, the team is working on ideas that are extensions of this campaign, but evolving further to drive more credit card acquisitions for the Sony and PlayStation cards.

"The idea is keep working … and keep pushing and challenging to bring in more ideas," Rangwalla concluded.

Creative Sample

Sony influencer email

Sources

Sony Electronics

Pursway — Sony's influencer marketing analytics vendor

Related Resources

Marketing Automation: Key challenges a global information company overcame to transform from batch-and-blast to persona-driven email marketing

Email Marketing Segmentation: Clothing brand uses social behavioral data to drive a 141% increase in revenue

Social Media Marketing: Sony Electronics increased new follower growth 200% with charitable Pinterest board

Social Email Integration: Sony Electronics nets 3,000 clickthroughs from email to "pin" on Pinterest

Email Summit 2014: Top takeaways from award-winning campaigns

Email Marketing: BustedTees' personalized send times increase email revenue 8%


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