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Case Study: Do Gamblers Respond to Direct Mail?

Date: November, 2014 -- this Fresh Data Case Study we’ll take a look at how a Danish nonprofit organization, who fund their support for youth sporting facilities with proceeds from lotteries, sports betting and other games of chance, faired when they tested direct mail for the very first time and further illustrate how the response metrics held up against existing traditional and online methods of communication for acquisition purposes. This Fresh Data Case Study is brought to you by Data Services, Inc. in cooperation with our friends at the Prescott Report.

In a recent article we covered the experience of Dyrenes Beskyttelse, a Danish non-profit organization supporting animal shelters.  They tested letters and cards only, media only (radio), and a combination of letters and cards and radio.  The results of using the combined media in terms of recall, interest, relevance and branding were dramatic.  

Another Danish charity, Danske Spil, has likewise tested direct mail, but literally against all comers.  The company was founded in 1948 and supports facilities for children in need (“SOS children villages”), sports for children, and high performance sport. 

Funding is generated by ongoing lotteries and other games of chance named Lotto, Quick, Tipps and Oddset.  In addition, they offer betting on sports games and horse races and they offer online poker and casino games.  These generate some €700,000 profit per day in a country of about five and a half million people! 

Danske Spil offers a “Plus Abo” service which provides an additional lottery drawing each week for those who subscribe. For the first time ever the company decided to use direct mail to promote subscriptions to this service, in addition to TV, radio, newspapers and magazines, and of course online. 

 A very colorful direct mail piece went out in five versions to five different target groups.

As an involvement device, the letter offered the recipients a little taste of winning.  The reader was invited to go to the homepage of Danske Spil to check if the free entry number in their letter had won an expenses-paid holiday trip.   

The test was formulated and results tabulated by media specialists from “Brand Science/OMD” who had developed tools to track the results and calculate the media source of the response and the amount of turnover attributable to each. The model also takes into consideration competitive advertising, holidays, and even weather! Their work is highly respected in Denmark and this analysis is considered 90% accurate. 

The results of the campaign “Plus Abo” were astounding: 

Surprisingly, direct mail at 84 was by far the least expensive driver of new subscribers.  The online cost per subscriber (basically email and search) was 10 times more expensive

In fact, direct mail contributed 21.5 % of the new subscribers generated by the campaign, against 7.6% of the new subscribers generated through TV, radio, print adverts, and online combined.

Letter mail was then incorporated as a key element in the marketing program of Danske Spil and the average cost of new subscriptions has been reduced by 28%. 

There is absolutely nothing so convincing as success, and be very sure that an institution such as Danske Spil who has done this since 1948 knows what it’s doing through constant testing.  It’s a very professional and impressive organization. Take a look if you’re inspired: 

And you can bet that the company utilized the best data management and data quality protocols in order to get those results, just as Data Services, Inc. will help you with advanced data hygiene and marketing analytics tool to drive your data-driven decisions.