PAW PAW INCREASES PURCHASES VIA CALLS

PAW PAW, Mich. -- One-store operator Paw Paw Shopping Center here has completed two tests of a new automated telephone marketing system that has so far elicited double-digit responses to an offer for free staple products while boosting basket sizes.The system, provided by BasketBooster, New York, generated a greater than 10% response to an initial 400-household phone campaign tried in March and a

PAW PAW, Mich. -- One-store operator Paw Paw Shopping Center here has completed two tests of a new automated telephone marketing system that has so far elicited double-digit responses to an offer for free staple products while boosting basket sizes.

The system, provided by BasketBooster, New York, generated a greater than 10% response to an initial 400-household phone campaign tried in March and a 12% response to a 600-household effort launched in April, according to Marvin Imus, president of Paw Paw Shopping Center, a family-owned independent supplied by Spartan Stores, Grand Rapids, Mich.

In addition, Imus said he found that shoppers who responded to the 15-to-30-second offer, all loyalty card holders, increased their basket size between 15% and 30%. The offer was for a free gallon of milk or a free dozen eggs to shoppers who made a minimum purchase of $10 within a two-day period and mentioned to the cashier that they had been contacted about the offer.

Imus, who plans to do further tests of the system, said he expected higher response rates "as people get comfortable with it" and remember to redeem the offer, made two days prior to the redemption period.

Four groups of loyalty shoppers were targeted in shoppers were targeted in

the campaigns, based on level of purchase history. "We wanted to keep it simple to make sure that phone calls would be acceptable," Imus said. Shoppers were called between 10 a.m. and 4 p.m., in an effort to reach their answering machines while they were at work, he noted.

About 80% of the calls reached an answering machine or service, said Jose Barroco, chief executive officer, BasketBooster. Shoppers who answered the call got a shorter message, he added.

Imus taped his own personal messages in which he identified himself for the campaigns. "I could have had a professional do it but I wanted to use my voice," which many shoppers of the small-town store would recognize. "I may fumble and stumble in the messages, but it seems more natural and less intimidating than if it's not someone they know or recognize."

Imus said he has never done a large-scale telemarketing campaign before. In the past, he has used the phone to call specific shoppers on their birthday.

Imus obtains shoppers' phone numbers from loyalty card information and provides the list to BasketBooster, which handles the automated calls. Shoppers can opt out of receiving further calls by pressing 0 or calling an 800 number, said Barroco. Imus acknowledged having some concerns about not offering an opt-in or opt-out scenario before doing the calls, but thus far only one shopper has opted out. "Most of them thanked me," he said.

Barroco said BasketBooster's phone campaigns are exempt from federal laws barring telemarketing solicitations because the calls are aimed at existing customers. In fact, because phone lines are "less cluttered than they used to be, that has worked in our favor," he said.

The cost of the BasketBooster service, which includes message creation as well as delivery and analysis, ranges from 5 to 10 cents per call, said Barroco, who launched the service this year. He said several other retailers, mostly independents, are testing the service.