Case Study: The Effectiveness of Emory University’s Course Catalog as a Marketing Tool

By Jacob Ensign, Business Analyst, JMH Consulting, Inc.

How effective is your catalog in marketing your classes? How many catalogs hit the trash as soon as they reach your targeted addresses? How many catalogs do you need to mail to get one person to register for a class? How much average income does each catalog generate? It is becoming increasingly difficult to justify the increasing costs of printing and mailing course catalogs without asking these types of questions. In addition, while direct mail is still a primary marketing tool in the continuing education industry, and it represents huge expense, in both labor and dollar amounts.

Data-driven decision-making seems to be the motto of the decade in the business and academic worlds, but I find that there often a disconnect between the intention to be data-driven and the capacity to act on those intentions. While many sources indicate that we need to be thinking about data-driven decisions, there is a lack of empirical support for the benefits it offers and “how-to” guidance.

In this article, we discuss how JMH helped Emory University’s Center for Lifelong Learning (ECLL) improve their catalog mailing process. Before starting this project, Emory had no way to accurately measure the effectiveness of their catalogs. By asking pertinent questions and analyzing the available data from previous mailings, we were able to make significant improvement to the revenue generated by mailed catalogs. The result was that the catalog changed from a quarterly bear and pain-in-the-neck to a predictably profitable endeavor.

Background

Since 2004, JMH Consulting has been responsible for the management and marketing of ECLL continuing education programs. Among many of the activities JMH staff performs on Emory’s behalf, JMH helps design ads and the layout of the quarterly catalogs. While we have automated much of the catalog process, there is still a lot of hard work and expense involved.

Catalog production alone takes upwards of three weeks of teamwork. We generally allow another two weeks for catalog printing and distribution. In addition to the staff time on this project, the catalog rank as the departments highest direct marketing expenses. Emory spends over $35,000 on each catalog. Multiply that by four times per year and it is not difficult to see why the catalog represents an extremely important project for JMH and Emory staffers.

Before fall quarter in 2006, we had no answers to the questions posed in the first paragraph. A lot of design work, project management, and dollars went into the marketing piece, but we had no hard evidence to support the presumption that we all held: that mailing nearly 90,000 catalogs every quarter is a good investment of our time and money. While Emory mailed catalogs to people in nearby zip codes and that fit a select demographic, Emory staff trusted that the total amount of money generated by mailed catalogs was worth the money and time spent on sending them. Intuitively, we felt many catalogs were wasted on zip codes that did not contain likely customers. Rather than assuming we could target prospective customers based on demographic information, we sought to base improvements on actual observed behavior of people in each zip code.

Methods

By asking a good question, you can develop a sound strategy for generating useful and functional answers. At the beginning of the article, I posed four questions:

• How effective is your catalog as a marketing tool?
• How many catalogs hit the trash as soon as they reach your targeted addresses?
• How many catalogs do you need to mail to get one person to register for a class?
• How much average income does each catalog generate?

JMH set out to answer the second two questions in the fall quarter of 2006. The ultimate goal of the project was to determine whether some zip codes that had historically received catalogs should be removed from future mailings because they failed to generate enough revenue to justify the cost of printing and mailing catalogs to those residents.  

Comparing registration data from Emory’s database with data from the mailing house, we analyzed the zip codes to which Emory was sending catalogs. We compared the number of quarterly registrations that came from each of those zip codes to the number of catalogs mailed to those zip codes each quarter. Immediately, we found shocking results: in one zip code, Emory only received one registration for every 400 catalogs mailed there. In another zip code, every 15 catalogs resulted in a registration. Perhaps the most surprising aspect was that both zip codes “looked” like good candidates based on the demographic criteria Emory used at the time! Imagine that.

In other cases, the differences between zip codes were not as obvious. They required further analysis. Using the dollar amounts generated by registrations from each zip code, we compared the actual cost of catalog printing and distribution to the income generated from each zip code. This allowed us to compute the true ROI for each zip code receiving catalogs.

In the spring quarter of 2005, the total ROI from catalogs mailed to non-customers was a dismal -30%. That means that Emory was actually spending more money to print and mail catalogs than the catalogs generated in new revenue. Based on our recommendations, Emory shifted how the catalogs were distributed. Emory stopped sending catalogs to zip codes with negative ROI and increased the number of catalogs sent to profitable zip codes. The result was a dramatic improvement in ROI for spring 2006: the total ROI of the speculative catalogs reached 88%. That means that in spring 2005, the catalog was losing money. In spring 2006, it was earning money. ROI for speculative catalogs continues to operate at a higher level each quarter since the initial analysis and recommendations.

Since we saw such value from the initial analysis, we decided that we might derive more value by drilling further down. More recently, JMH applied the same analysis at the carrier route level. A carrier route is the set of all addresses to which an individual postal carrier delivers mail. Mailing houses frequently use demographic data about carrier routes to create mailing lists for their clients. We repeated our analysis of zip codes for individual carrier routes and, not surprisingly, found that there is diversity in ROI within each zip code.

For example, we mailed catalogs to households in 16 carrier routes within one zip code. Over a six-month period, three of the 16 had negative ROI (-100%, -100%, and -70%). However, four of the sixteen had positive ROI over one thousand (1042%, 1715%, 2138%, and 3517%).

Using this information, we identified the carrier routes that had demonstrated very healthy ROI. Emory then used this information to refine the list of catalog recipients even further. In effect, Emory cut the remaining unprofitable carrier routes. This can only increase the ROI even more.

Final Thoughts

Our analysis of catalog effectiveness for Emory’s Center for Lifelong Learning resulted in simple changes to the process of selecting catalog recipients. These changes were easy to implement and resulted in a positive increase in revenue and profitability for all of ECLL.

If your continuing education department is not thinking about direct mail in this way, it is time to start. You must be asking and answering the right questions. If you are not already thinking about marketing in terms of data, it is a safe bet that your department is wasting valuable time and money.