Re: Market Research Success Stories

Posted by Ian Straus on January 24, 2000 at 14:39:44:

In Reply to: Market Research Success Stories posted by Chris Riepe on January 21, 2000 at 17:27:14:

Often it's hard to quantify results because the dollar benefit depends on taking action; and seldom does management say "if not for your research we would have done something really stupid".

But I've got my own unpublished story:
At La Quinta Inns, in 1996, the three of us profesisonal-level folks in Relationship Marketing were fairly new to the company.
(I left LQ this past summer, when they moved headquarters - so this is not a shameless commercial plug).

LQ has a frequency program, Returns Club.
Our predecessors had a fairly frequent program of "re-activation" mailings: Sending a discount coupon and a request to come back, to frequency club members who had not stayed in the hotels recently.
That sounded OK, but we saw no proof that it worked, and couldn't quantify the benefits. We considered doing a split sample test, treatment group and control group.

Instead, we did a fairly cheap phone survey of members who had not been active for the appropriate period of time.
Came to find out, a large proportion had moved and not updated their phone or address with us - so our mailing to them would have been wasted.
The rest had changed jobs or retired, so they no longer travelled nearly as much, or no longer travelled in our market areas.
Hardly anyone had become inactive because they were annoyed at us, or won over by competitors.
Twin conclusions:
1) The reactivation mailings were a waste - so we saved several tens of thousands of dollars a year by eliminating them.
2) LQ's service quality is pretty good; best to concentrate on growing the frequency program. Which we did.

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