Let’s Go Back to College!

Let’s Go Back to College!

For this week’s blog, we’re going back to college, where sleeping until 11am (skipping your 8 o’clock class) and drinking beer in the afternoon could be “majors” in themselves. Andrea Godfrey, an assistant professor of marketing at the University of California at Riverside and co-authors, marketing professors Kathleen Seiders of Boston College and Glenn B. Voss of Southern Methodist University, have authored a study entitled “Enough is Enough! The Fine Line In Executing Multi-channel Relational Communication.” The study was recently published in the July issue of the Journal of Marketing. To “cut to the chase” the study concludes that businesses should do most of their customer outreach by postal mail and go easy on telephone calls and emails (God bless them).

According to the authors, three phone calls, along with three or four emails, and nine or 10 postal mailings over three months is the ideal mixture to stir customer interest. More contact irritates customers who don’t like getting bombarded with pitches. According to co-author Godfrey, “Good old snail mail seemed to be more effective in the long term than phone and email.” The results challenge a popular marketing theory that constant communication with customers is essential to building a strong relationship, Godfrey said.

You know this blog is a fan of “Cliff’s Notes”, so the executive summary of the study is below:

Enough is Enough

Research shows optimal amount of e-mail, phone and mail communication between businesses and customers

More isn’t always better.

That’s the main message of a paper that analyzed 39 months of phone, mail and e-mail communication between an auto dealership and its customers in an attempt to measure the ideal level of communication to maximize customer spending.

“We probably need to rethink the idea that to have a strong relationship with customers we need to be communicating with them all the time,” said Andrea Godfrey, an assistant professor of marketing in the School of Business Administration at the University of California, Riverside who co-authored the paper.

The paper “Enough is Enough! The Fine Line in Executing Multi-channel Relational Communication” has been published in the July 2011 issue of Journal of Marketing. Godfrey’s co-authors are Kathleen Seiders, an associate professor of marketing at Boston College, and Glenn B. Voss, an associate professor of marketing at Southern Methodist University.

The research yields new insights into the unintended and potentially detrimental effects of communicating using multiple channels. While the study focused on an auto dealership, the findings can be applied to a variety of industries, especially service-oriented fields, Godfrey said.

The researchers found the ideal level of communication varies across channels and that once that level is reached additional volume generates an increasingly negative customer response. They also found the ideal level of communication through one channel decreases as volume in other channels increases. This is in contrast to previous studies that found synergies when communication occurred in multiple channels.

And, perhaps the biggest surprise: mail was a pretty effective communication method. Customers tolerated about twice as much mail compared to phone calls and e-mails before their spending levels started to decrease.

Going into the study, Godfrey didn’t expect mail to be very effective because people are so numb to junk mail. But, after reviewing the findings, she believes customers tolerated more mail because it is perceived as less intrusive than telephone calls or e-mails.

The research focuses on multi-channel relational communication, defined as personalized communication with existing customers through various channels as part of a marketing strategy. The communication can remind customers of needed services, announce new products and locations, survey satisfaction or convey promotions.

Despite widespread use of multi-channel relational communication, the effects on customer spending are not well understood. Most agree that some level of communication is better than none, but little is known about whether there is an ideal level, if too much communication can turn off customers and how the different communication channels combine to impact customer decisions.

The researchers matched the results of 1,162 surveys filled out by customers of the auto dealership with corresponding data from the company’s contact records and transaction database. Contact records included the dates each customer was contacted and communication channel used. The transaction database captured the date of the customers visit and the amount the customer spent.

Using three-month increments, the researchers found the ideal level of communication was three contacts for telephone, between three and four for e-mail and between nine and 10 for mail.

The researchers also looked at ideal levels of communication when two channels were combined.

For instance, in one example, they found with one telephone contact the ideal number of concurrent e-mail contacts is five to six, but the ideal number of e-mail contacts drops to two to three when there are three to five telephone contacts.

They also found when there is one mail contact, the ideal number of e-mail contacts is approximately five, but the ideal number of e-mail contacts drops to one when the number the mail contacts is five.

While this study only focused on mail, e-mail and telephone communication, in the future Godfrey and her fellow researchers would like to measure the effectiveness of the next frontier of methods of communication: texting and social media. Like the traditional methods of communication, she expects they will be effective for a while, before some level of burnout occurs.


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