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Sep 12, 2002
Case Study

Ticket City Measures Print Newspaper vs Ezine Ads

SUMMARY: And they both won! Print newspapers brought in the sheer volume of new customers the Company needed to grow, while email newsletters brought in the most cost effective (by far) new sales. Learn how direct merchant Ticket City has adjusted its advertising budget from offline to online. Plus, hear how the Company measures sales by the channel that initially triggered the sale (as opposed to the channel it ultimately came in on).
CHALLENGE

Ticket City is perhaps best known for its toll free number 1-800-SOLDOUT which it advertises everywhere you could possibly imagine.

"It's been sort of a guerilla approach to marketing," explains VP marketing Zach Anderson, "from old standby methods like postcards and brochures through the mail to e-newsletters, banner ads and listings on Overture." The Company even ran ads on the last newly aired Seinfeld episode, and is now one of the first advertisers to test video ads in elevators.

With so much outreach, Ticket City did not know where most new customers came from, or which sales were gained the most cost effectively.

"You can throw money everywhere, but until you try to understand where your sales are coming from and how each customer hears of you, marketing is like throwing darts blindfolded," says Anderson. (We will bet every marketer reading this completely agrees.)

CAMPAIGN

Ticket City's orders come in three distinct ways: Through the phone, via clickthroughs on promotional hotlinks, and from Web surfers who go directly to the site to purchase.

However, Anderson knew the channel a customer uses to order is not necessarily the exact same channel they heard about the Company from. All of Ticket City's advertising and marketing campaigns are carefully integrated, mentioning Web and phone equally. For budgeting and strategic planning, where an order originated from is far more important in the long run than what channel it ended up being taken in.

The Company built an integrated database on the back-end that every single order feeds into no matter the channel.

Anderson yearned to gather loads of customer data by surveying incoming orders, but that is not practical. "We couldn't bombard them with 20 questions. We want it to be as unobtrusive as possible. While we'd like to ask extremely pointed questions, like which newspaper, we have to balance customer experience in everything we do."

He limited the data gathered to two critical points:

1. "How did you hear about us?" Sales reps ask callers after they place orders, the Web's order form has a check box, and responses all hotlinks in newsletters and Web ads are carefully counted using affiliate software.

2. "Are you a new customer?" Anderson notes, "We want to know the repeat business rate, but we don't want to count a repeat customer against another media."

The site and phone sales reps ask this question when people order. Just to be sure they got the correct answer, Ticket City's database also runs regular checks matching new orders against past ones.



RESULTS

Ticket City's data reveals that newspaper ads are the most productive media buys for generating new customers. In July 2002 alone, approximately 50% of new clients were referred by newspaper ads. However, viral pass-along buyers from Ticket City's own in-house customer newsletter come in at the lowest per-new-customer cost (just $10 per new client versus $40 average for any other media).

Therefore Anderson's begun a full-throttle push to get more email newsletter sign-ups, again using multiple channels including in-bound telesales.

However, he warns that increasing email can backfire. "It can be a touchy situation since so many of us spend part of our day removing junk mail left and right." The key to not crossing the line for Ticket City is focusing on interesting content (versus sales pitches) and limiting newsletter frequency to twice a month.

Anderson's measurement reports have made a definite impact on his budgeting for the future. Three years ago the Company spent 75% of its ad budget on print media ads, now 50% of the budget is dedicated to online and email.

These shifts are working. Since the Company began tracking where new customers come from, its sales have risen 300%, and in 2001 Ticket City was named the 17th fastest growing under $10 million company in the Austin area. This year they hope to win a similar award, but in the over $10 million category.

http://www.ticketcity.com

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