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Sharing our Secrets: Part 1
Which are the best channels for recruitment? T
By Nigel Swabey,
nswabey@mailtrainmedia.co.uk
If I’d known then, what I know now…. Catalogue brands like Kaleidoscope, Scotcade, Innovations and even Scotts of
Stow, would have been much more profitable.
rial and error is an expensive way to learn one’s trade, and direct
retailers have had a tough time in recent years. That’s why we’ve recently decided to start sharing our experience with industry colleagues in the DCA. We’re quite happy for the secret of our success to become an open secret.
New Customer Recruitment Part 1 – Our Top Ten Offline Channels
The 4 key metrics we use to rate each recruitment channel – we call it the Q-score. Ask any direct marketer to name their greatest priority and they’re likely to put ‘New Customer Recruitment’ right at the top of their list. We all need a reliable source of low- cost or no-cost new customers for our brands. New customer recruitment is our top priority as although we do everything possible to retain customers, certain types of customer attrition like mortality, are unavoidable. Each year, you may need to find 10,000, 50,000, or in our case at least 150,000 new customers, to maintain the size of the 0-12-month customer file and feed future growth in the business.
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But in my 47 years as a direct retailer, I’ve learnt that there’s so much more to prospecting than finding the lowest ‘cost per acquisition’ (CPA) or cost per customer (CPC). Your cheapest new customers are not always your best customers. At Scotts, we’ve tried almost every channel of recruitment over the past 30 years and have developed a metric that takes account of the pros and cons of each individual channel. Q-Score is the mnemonic we use to remind ourselves of the values we use to measure the value of each recruitment channel.
Q is for Quality – which channel has highest LifeTime Value (1=Low LTV, 10 = high LTV) S is for Scalable – which channel offers the greatest volume (1 = not scalable, 10 = scalable) C is for Cost – which channel offers the lowest cost (1 = High cost, 10 = no cost).
R
is for Risk – which channel carries the highest risk of losses (1 = High risk, 10 = Low risk)
The reader should bear in mind that Scotts’ experience of Q-Scores may not be applicable or appropriate for other brands, products or services.
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