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Oct 24, 2002
Case Study

How Flexcar Gets a 72% Marketing Email Newsletter Open Rate

SUMMARY: If your company operates in multiple locations, or has multiple
product lines, or multiple buyer demographics, then you really
should be considering publishing several different email
newsletters.

Who has time? Flexcar decided instead to create one ultra-
personalized newsletter that adjusts itself to each subscriber.
That may sound complicated (and expensive) but it is really not.
CHALLENGE

With a tiny "multi-hundred" ad budget, Flexcar auto
rental service desperately needed a cheap solution to spur usage
and to help the Company grow more quickly.

Director of Marketing John Williams was already having print
newsletter stuffed in with every printed bill that was mailed to
customers whenever they used the service. The tactic saved on
postage and envelope printing, but the general content did not
reflect Flexcar's brand of being flexible for individuals' needs.

Plus, only about 50% of the consumers who had signed up on
Flexcar's site to become members then went on to actively rent
cars through the service. These bill-stuffer newsletters only
reached about half the people in Flexcar's opt-in database.

Williams decided an email newsletter was his best bet to reach
everyone without busting the budget.

A generic mass-send newsletter wouldn’t do. “We needed a
personalized tool that would be valuable to each customer.”
Williams explains. “Each subscriber had to be able to easily
customize the content and frequency of their newsletter." After
all, what is the use of news of an available Flexcar in Seattle to
someone in LA?

Plus, he figured the more personally relevant a newsletter he
could send to each member, the greater the likelihood members
would be inspired to forward issues to friends.

When your advertising budget is itsy-bitsy, you grab every straw
of viral marketing you can get.

CAMPAIGN

Williams did not have the hiring budget or spare time
to create this highly personalized newsletter in-house. "I
needed something I could run as a one-man show," he says.

He was also highly aware that marketers sending mass email
broadcasts from in-house are frequently filtered out by ISPs
these days. "S*pam filters don't allow private companies to send
member blasts."

Finding a vendor that was willing to work with a small
company on a budget took some research. Williams notes, "Most of
the email marketing firms I looked at handle complex, large scale
operations with thousands and thousands of customers, and they
charge a minimum or $5k to $10k per month." Finally he found the
right vendor for his needs (link below).

Next Williams had to decide how much personalization to offer
readers. He chose four levels:

-> Level 1: By name
Both the salutation and ending of each issue addresses the
member by their first name.

-> Level 2: By location
Instead of just assuming that a member would want
information about specials and news in the region indicated
by their street address, Williams went the extra mile and
made the sign-up form flexible so members can ask for
information in more than one zip code.

If new members request an area that is not currently served,
instead of flashing a "no service" error, the sign up form
politely offers them the ability to be notified when the
service comes to their area.

-> Level 3: By HTML vs Text
Many marketers forget that the HTML versus text debate is not
just a matter of what format an email user can receive, but
also what format they prefer to receive. Williams made
sure he asked, and that HTML was described clearly in the
question for those who might not know what it means.

-> Level 4: By Content Topics
Subscribers have their choice of 10 different topics, such
as "News articles about Flexcar" and "News specific to the
Bay Area Region (Including special deals on Flexcar
vehicles)."

Again, note that Williams is not assuming you want
information about a particular region based on your
mailing address. You must request it, and can pick
whatever region you would like.

-> Level 5: By Frequency
Picking newsletter frequency is tough for most marketers.
Too frequent and readers stop opening your messages, too
seldom and readers forget you exist. Williams decided to
offer sign-ups their choice of two frequencies, "Monthly"
and "As soon as new information is available."

However in reality, he decided to limit the "as soon as"
frequency to about every two weeks. He explains, "I didn't
want managers in the various regional offices to turn it
into a crutch and send a member blast every time a special
popped up" thus risking the chance that open rates might
drop dramatically.

Once Williams decided on the personalization, he took three
further steps prior to launching the newsletter:

Step 1: Getting internal feedback

Williams sent a sample issue to Flexcar's general managers in
three regions. "I wanted to get their input to make sure I
wasn't missing primary things about the grass roots level of how
these things work," he explains.

After getting back emailed comments, he took it one step further
and held a series of conference calls with the managers to dig
into their ideas further. Turns out the managers' biggest worry
about the new newsletter was, 'How will members in my region be
able to contact us easily?'

Everyone decided to add a big clickable "Give Feedback"
button to the end of each issue. (Link to sample below.) Users
clicking on the button get a very simple pop-up form that asks
for their comment, and asks for their email if they want to get
an emailed response. The feedback is then automatically directed
to the manager in their region, plus a copy is sent to
headquarters.

Step 2: Adding a Strong Privacy Statement

Williams added the words, "Flexcar does not share this
information with anyone ever" at the very start of the newsletter
subscription form.

Step 3: Adding More Links to the Sign Up Form

Instead of counting on a box in the member registration process
to collect 100% of subscribers, Williams got more aggressive with
the offer by adding links to the sign up form from all of the
site's major pages. This way visitors who did not want to go all
the way and become full members quite yet could still get the
newsletter (and hopefully become persuaded to become full members
later).

The new personalized newsletter launched six months ago in May
2002.



RESULTS

A remarkable 72% of subscribers open an average issue
and a recent special announcing the new Miata had an open rate
of more than 90%. (We know of few other newsletter publishers
who could boast of numbers like these.)

The newsletter's active readership has parlayed into more sales, since its launch members rent on average 15% more hours of car
use. (Flexcar rents by the hour instead of by the day.)

The newsletter is as viral as Williams had hoped, more than 30%
of new Flexcar customers come from member referrals often because
someone got a forwarded issue.

More than 22% of readers have used the Feedback button at some
time (link to a sample of an actual reader feedback below).

After reviewing initial reader feedback, Williams changed the
order that content appeared in the newsletter. "Customers said
they were less interested in news on Flexcar and more interested
in vehicle updates and things pertinent to their regions. Now
the information specific to their region is the first thing they
read and then we scale it down into more generic Flexcar info."

Interestingly, when given the choice, many people did want to get
news on car rentals in more than one region. The numbers are:

60% wanted Seattle car info
16% wanted Portland OR car info
66% wanted LA car info
17% wanted DC Metro car info
---
159%

Of the other types of information choices offered, here is what
readers wanted:

97% New Flexcar Programs & Enhancements (the only pre-checked
option)
97% To hear about New Vehicles in Your Neighborhood
86% Tips on How to Maximize Flexcar Membership
71% News Articles about Flexcar
69% To Participate in Flexcar Fairs and Events
68% News Articles on Transportation Issues

Adding the subscription link to other places than just the member
registration form was a big success. Currently 31% of opt-ins
are not members yet. If growing your list is important,
definitely put your offer in more places on your site!

Useful links:

Sign-up form for personalized FlexNotes
http://www.tailoredmail.com/flexcar/

Sample of a FlexNotes newsletter issue, plus an actual response
to their "instant feedback" form:
http://www.marketingsherpa.com/flexnotes/ad.html


The service Flexcar uses to create and distribute FlexNotes, and
to manage the subscriber database:
http://www.tailoredmail.com

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