CINCINNATI -- A series of customized co-op mailings for Tide With Bleach that appeared in consumer mailboxes during August and September is among the first fruits of Procter & Gamble's extensive data base marketing activities.
The program, which allows retailers to accrue credits based on case volume and apply them toward targeted direct mail, puts P&G on the leading edge among brand marketers who have been developing consumer data bases.
Co-op direct-mail pieces have been developed and mailed for the Publix Super Markets chain in Florida, and for Venture Stores' Chicago area market, among others, market observers said. The mailings identify the retailer and include a coupon for Tide, typically worth about 50 cents.
The Tide program went national this summer, following testing earlier in the year in the Illinois and Wisconsin markets, said P&G spokeswoman, Teri Glover. Several Tide mailings went out in June. The latest round focused on Tide With Bleach.
"This program provides our customers with an opportunity to comarket their stores with a leading brand, that being Tide," she told Brand Marketing. "Customers earn credits toward this based on case purchases. This is similar to our ongoing co-op advertising program."
She added, "This is a program that we are offering to all customers nationwide. It provides customers an opportunity to send
customized mail pieces to consumers living in their areas."
Burt Flickinger, consultant in the consumer goods practice at A.T. Kearney, New York, said a limited test of the program at Publix has been a "phenomenal success."
"P&G has been putting together a phenomenal data base for a long time. It is a living, verified-within-two-weeks consumer data base. When used with a retailer's own shopper data, a combination of the two can really help pop share," he said.
"Direct mail is the next Starship Enterprise evolution of the Tide program," Flickinger added.
Ken Harris, consultant with Cannondale Associates, Evanston, Ill., said that while a number of packaged goods companies are exploring data base marketing, the Tide program differs from any that have come before in several distinct ways.
"One, they have a better data base than most. Two, they are using it to tie in with the trade. And three, they are offering it in lieu of spending other dollars with the trade."
Harris said that the mailings are all sent to names drawn from P&G's proprietary mailing list. Since those names will include many area residents who are not current customers of the participating retailer, "It gives them leverage to add value," he said.
Jim Keller, senior vice president of business development for DCI Cardmarketing, Manasquan. N.J., said "I think it is a very smart thing for P&G to be doing. Tapping into one of their proprietary lists may enhance the number of customers coming into the store. To me there is a win for the retailer and manufacturer and also the consumer gets significant value. Importantly in that event, you can really thank your customer for supporting your brands."
The direct mail program was developed for P&G by J. Brown/ LMC Group, a marketing agency based in Stamford, Conn. Jack Brown, chairman of the agency, confirmed his firm's involvement, but declined to provide further details.
Although advertising co-op is a widespread practice among marketers of fast moving consumer goods, observers said they were not aware of any other programs to date that linked in with data base marketing.
"Accruals for big accounts are not new," said Mickey Goodman, a managing partner at Market Growth Resources, Wilton, Conn. "But paying out in terms of media or direct marketing? That would be really smart because it brings in equity for the brand."
Said A.T. Kearney's Flickinger, "P&G is the world's largest advertiser and the most efficient buyer of measured media at costs far below what other advertisers can manage, due to its volume leverage. They can share some of this savings with retailers. Retailers can literally buy full carloads of Tide plus get advertising on top. This entire proposition is much more powerful than any other competitor can offer," said Flickinger.
While P&G says it offers the Tide program to all its accounts, Cannondale's Harris said he was skeptical that any but the largest accounts -- "the top 30" -- will be able to take advantage of it.
"It won't pay out beyond a certain level," he said, and enumerated overlapping trading areas and trade channel issues among possible obstacles. "If retailers can meet a certain criteria they can participate."
DCI's Keller said he didn't see any major obstacles for retailers to take advantage of the direct mail program. "It might be for P&G's largest brands, but my sense is it would not be scaled to any particular retailer. I don't think it has to be limited to the largest accounts," he said.