UPS Delivers Coupons Direct to Consumers’ Doors
UPS is making special deliveries this week to residents in five test markets
around the U.S. The packages contain discount coupons
and samples from a wide variety of retailers and consumer goods marketers including
Bed Bath & Beyond, Johnson & Johnson, Sephora, Williams Sonoma,
Zappos and others.
The UPS Direct to Door program will begin its test to consumers in zip codes
in Chicago, Dallas-Ft. Worth, Miami, Phoenix and Washington, D.C. Each package
delivered to consumers contains roughly 12 offers and samples.
“As
marketing channels evolve and consumer choices increase, we need new touch
points to connect with customers,” said Pat Connolly, executive vice president
and chief marketing officer at Williams Sonoma, in a press release. “With
a UPS Direct to Door delivery, we’re reaching an active consumer, an important
factor for increased response rates.”
“Retail
marketers are looking for ways to make their messages stand out,” said Casey
Chroust, executive vice president of retail operations, Retail Industry Leaders
Association. “UPS Direct to Door serves as a very unique and targeted marketing
approach because messages are personally delivered to the door, which makes
the delivery special.”
Discussion
Questions: What does the UPS Direct to Door program offer retailers and
brands that other direct marketing vehicles do not? Do you expect to see
higher redemption rates with this program than with competitive models?
The approach is good. Share the cost of delivery among a group of advertisers. Rather than receiving something that looks like standard junk mail, the UPS Direct to Door program gives the package more importance and the household may in turn take the offers more seriously. For the program to work long term, UPS needs to be sure to keep the offers unique and of real value. If they don’t consumers will soon realize this is just another piece of junk mail.
Question. How are UPS and the coupon advertisers selecting households? Are they using syndicated data or some other source? This could have a major impact on the program’s success.
I like this UPS Direct to Door concept. I hope it can be customized to what I want when I want. If it is the beginning of a relationship, that’s perfect. If just another delivery of brands squawking AT ME without my input, not so much. I also wonder if they could save some trees with more green packaging.
I love it! What a great example of a company–excuse in advance, the play on words–“Thinking Outside The Box.” Curious to see how the test goes, and how far they take it beyond handing off the offer/sample.
It sounds as if the marketers are trying to find a new way of doing the same old thing. Though not UPS, these types of co-op programs have been around for decades.
The question that has to be asked is, how are the target consumers chosen and delivered? Unless, EACH package is matched to a particular consumer, the marketer is wasting effort and resources. The days of dropping coupons to those who don’t use them are numbered.
The equation works slightly different on the sample side, but only slightly. It is more efficient to give a target user a coupon for a free package at the store than to shotgun samples to the marketplace to users who will never buy the product.
This has potential. Similar to the way that direct-mail coupon packets spread delivery costs across multiple brands, a UPS-delivered sample pack can make direct-to-home sampling more economical.
UPS says it will only drop these goodies off at homes that are already receiving a delivery on a given day. That makes cost-effective sense. It’s also selective in a positive way–delivery recipients will by definition be active direct-to-home shoppers, an excellent target group for marketers.
I’ll be interested to learn more about how UPS supports fulfillment of these sample packs. How customizable will their contents be? You can visualize the potential of this: Samples and offers might target specific delivery routes or block groups. Even individual households could be targeted, where the offering brand has some “one-to-one” information about purchase behavior.
From the recipient’s perspective, opening a surprise package of custom-selected samples and offers might be a tiny thrill.
Getting ‘junk’ mail to stand out is always a problem. 99% of the flyers hitting my mailbox go straight to the recycling bin. Courier packages always get opened, so this would seem to allow advertisers to ‘get to the front of the line’ in households. Add in that it appears to be a targeted approach, and it looks like a winner.
Now, can UPS add in this extra volume of deliveries and still maintain its service standards for the rest of their customers? That will be interesting to watch.
This could very well be an excellent strategy for direct-to-home brands to begin cultivating a positive and personal relationship with consumers. The element of hand-delivered, unexpected yet targeted/personalized sample(s) can have a lasting impression and build brand good will. The key will be to what degree UPS and these partner brands can personalize the sample boxes to be most appropriate for each recipient.
First thoughts on receiving Direct to Door Pak yesterday were:
1) Why is the UPS guy here so early ringing my doorbell?
2) It’s nice to get coupons we might use.
3) Dead trees.
The concept has potential, no doubt. Here’s hoping UPS figures out a way to do it with the least amount of packaging necessary. Amazon’s inclusion of coupons and samples in boxes of products ordered from its site seems a comparable alternative to UPS in terms of customer quality but at a lower cost to the environment. That is something today’s marketers need to consider.
The UPS “brand” separates this old idea from all the others and provides advertisers with a better than even chance to increase redemption rates. Key to ultimate success is maintaining a high quality level of participants. Wonder if and how UPS will be able to control this….
The UPS Direct to Door program to dispense retailer offers from manufacturers and retailers is a forward thinking idea. UPS is a very solid company that will do an excellent job. Now it’s a matter of how prepared and how well the retailer will plan, implement, and execute. And there is the multi-million dollar question.
Cost of delivery:
1. Courier
2. Mail
3. Inserts
4. Internet
5. POS
6. Phone Txt–POS
It seems unlikely that this will be the new thing.
Gene Detroyer is right on target (excuse the pun) when asking about customizing the contents of these packages to the individual recipient. And if James Tenser’s comment about UPS only delivering it to households that are already receiving a package is correct, then UPS may have found a way to keep the delivery costs low.
I see an interesting opportunity here for UPS. They already know a lot (some would say too much) about most households–specifically, they know what they have delivered to the household before. If a household receives regular shipments from 1-800-Contacts, then I’ll bet Bausch & Lomb would kill to get a mini bottle of their All-In-One contact cleaning solution into UPS’s Direct to Door package. The trick is building a fulfillment system that allows Just-In-Time targeted contents based on which households have packages en route. A simplified model might look like this:
1. UPS picks up a package for household X.
2. The fulfillment center nearest household X (or maybe at the UPS hubs through which that package will be routed) is notified to put together a Direct to Door package for household X based on pre-defined rules for which households each brand wants to reach.
3. The Direct to Door package gets routed to the same delivery depot as the original package, and both packages are delivered to household X together.
Of course, even better (and less creepy) than UPS using prior deliveries for targeting the contents would be if they could tie in to the household’s purchase histories through loyalty memberships….
There’s been a consumer backlash against the waste created by receiving unwanted catalogs and junk mail, so that makes me wonder whether consumers will roll out the welcome mat for UPS Direct to Door.
That said, having a box hand delivered along with another item the consumer definitely ordered does separate it from snail mail junk and create a bit of excitement. And, the list of participating brands is pretty good, as I assume are the enclosed coupons and samples. If the participating brands and product can be kept at a high level and the list of consumers receiving the boxes is truly targeted to those inclined to shop and buy, then this could prove a good way to reach consumers.
This is an innovative approach to direct mail from UPS which recognizes the challenge that marketers have in reaching consumers in this cluttered environment. Over the past 10 years, coupon redemptions have consistently declined, as newspaper subscriptions have diminished and some of the direct mail co-ops have gone out of business.
The UPS approach of a direct door delivery will be very effective the first time it is used, undoubtedly. Over time, though, consumers will eventually regard the package as yet another gimmick and, if the offers and samples inside are not personalized, they will begin to discard them wholesale, just like other vehicles.
UPS must strive to leverage consumer insight for personalization, or their novel approach will soon be on the discount rack, like all the rest.
I’m more skeptical on this concept for one fundamental reason: anyone can send a 3-D mailer today and the only real value in doing this through UPS is the non-USPS nature of it.
On the plus side, the level of spam and highly irrelevant digital direct marketing is making traditional postal mail increasingly effective.
However, what could truly set this apart and make it a grand slam home-run is if UPS actually begins to collect and/or use the data about the households it delivers to. If they connect prior shipper data to residential addresses, including names, then they can create a staggeringly powerful proposition. Otherwise it’s just more semi-targeted mass marketing.
This is a great idea. When paired with the retailer’s consumer specific data, the UPS direct program will reach the selected consumer during their crucial special promotions time frame. The retailer can also set the sample delivery program to follow their consumer home catalogs, offering something special to their special consumers. This promotion can also affect the retailer’s online customers.