Identifying the direct mail-prone consumer

Abstract

Current modeling research in target marketing usually stresses the identification of profitable names for specific mailings. There is little recent research about the characteristics of typical direct mail (DM) customers. In this paper we determine the link between customers' socio-demographic characteristics and their propensity to purchase products through the mail. We hypothesize the existence of a latent variable, DMproneness, which represents a consumer's tendency to shop via direct mail. Our model links the socio-demographics of customers to their self-reported purchase behavior through the latent variable of DM-proneness in a Multiple Indicators and Multiple Causes (MIMIC) model. We also introduce a second latent variable, DM information interest, which represents the desire to receive direct offers through the mail. The model allows for testing the influence of DM information interest on DM-proneness. We fit the model to actual consumer data using the LISREL program. The findings show that the characteristics of the DM-prone and the DM information-interested are similar, and that DM information interest appears to directly affect DM-proneness. The DM-prone consumer is identified as relatively younger, with somewhat lower education, rather welloff, from a relatively large family, and relatively more likely to have a female head of the household. We also show that consumers' tendency to shop via direct mail can be captured by a latent variable approach, and that DM-proneness can be quite well predicted by demographic consumer characteristics.

Understanding Customer Experience Throughout the Customer Journey

“…Although it mainly considers channel choice behavior, it offers key insights into analyzing, managing, and influencing the customer journey. Initially, studies focused on the choice of one specific channel, such as catalogs and direct mailings (e.g., Eastlick and Feinberg 1999; Leeflang et al 2013), online channels (e.g., Ansari, Mela, and Neslin 2008; Venkatesan, Kumar, and Ravishanker 2007), and mobile channels (Ko, Kim, and Lee 2009; Wang, Malthouse, and Krishnamurthi 2015). Since the arrival of e-commerce, an enormous amount of studies have assessed the drivers of online channel use.…”

“…Such preferences, and the influence of specific touch points, may change over time. Firms are confronted with operational challenges on how to deliver a good experience to these heterogeneous, dynamic segments (e.g., Leeflang et al 2013).…”

“…Firms are confronted with accelerating media and channel fragmentation, and omnichannel management has become the new norm (Brynjolfsson, Hu, and Rahman 2013; Verhoef, Kannan, and Inman 2015). Moreover, customer-to-customer interactions through social media are creating significant challenges and opportunities for firms (Leeflang et al 2013; Libai et al 2010). Customer experiences are more social in nature, and peer customers are influencing experiences as well.…”

Non-Store Retailing and Customer Satisfaction in Asaba Metropolis, Delta State, Nigeria

“…This finding support Bergemann (2010) finding that direct mail allows for greater customer targeting. Leeflang, spring, Van Doorn & Wansbeek (2013) identified a direct mail-prone consumer, establishing a link between socio-economic group and preferences of marketing communications. This implies that mail order can influence customer satisfaction.…”

“…However, being conducted in Australia, this research has limited applications to the UK consumer, as culture is a huge determinant in consumer choice (Yakup, 2011). However, later research from Leeflang, Spring, Van Doorn & Wansbeek (2013) counters their previous opinion to identify a direct mail-prone consumer, establishing a link between socio-economic group and preferences of marketing communications. Through a quantitative testing of hypothesis, they find 1) Younger people are more likely to be direct mail prone and 2) Younger individuals are more likely to purchase through direct mail, which contradicts the view of Greco (2011) that highlight 60-74 as the main users of direct mail.…”