HALLMARK USES LOYALTY EFFORT FOR SEGMENTING CUSTOMERS

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Hallmark Cards' 5-year-old Gold Crown Card loyalty program grew more sophisticated in 1998 with the introduction of targeted mailings, while annual sales tracked to the core program continued to grow in double digits.

The company rang up $1.5 billion is sales tracked to Gold Crown in 1998.

Going into 1998, the natural next step to build on the successful program was targeting.

"The key initiative in 1998 was to begin to segment our database," said Cindy Jeffries, Hallmark director of advertising. She said the timing was right since the company had amassed the necessary data to start dissecting them for consumer behavior.

Hallmark sends quarterly mailings to its 16 million-name database of Gold Crown Card members. The mailings include a statement of points accumulated in the loyalty program, a coupon for dollars off merchandise based on the point level, and a brochure featuring seasonal cards and gift-related products. All components are designed to reinforce the emotional benefits of Hallmark products.

Loyalty marketing agency Carlson Marketing Group, Minneapolis, helped the greeting card company divide its huge database into seven distinct segments, and several mailings dropped in 1998 were aimed at test marketing specifically to those groups, such as "card fanatics" and "ornament fanatics."

"We were able to get the greatest return on investment and bring the most targeted message to consumers," said J.D. Henning, senior account supervisor at Carlson.

Added Ms. Jeffries: "We've been successful in creating a relationship between the consumers and the stores. Simplicity is key. You need to make it easy for

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