CAMPAIGNDIRECT: ISSUE - This reader offer may breed loyalty or loathing/Is the Telegraph in danger of alienating its audience with a mail-order fashion range?

First it was bingo, then it was cut-price air tickets. Now the latest weapon in Britain’s newspaper wars appears to be skirts, jackets and blouses.

First it was bingo, then it was cut-price air tickets. Now the

latest weapon in Britain’s newspaper wars appears to be skirts, jackets

and blouses.



In a bid to explore just how loyal readers can be, the Telegraph

newspapers have launched their own fashion range. The T Collection is

aimed at 35- to 70-year-olds who might frequent Marks and Spencer

Clothes such as a pounds 110 wool and cashmere camel coat are intended

to be value for money, upmarket and reliable - in fact all the things

you might expect from the Telegraph. And they are available off the

page, nestled among relevant editorial, bringing home shopping to a

general audience.



The range is the idea of Kevin Gavaghan, executive director of Telegraph

Enterprises, the umbrella company launched more than a year ago to

explore the commercial opportunities of the paper’s editorial. Having

already launched a direct book and golf service, he is convinced it

works. ’This increases the profile of the Telegraph and makes people

feel they have a tighter relationship with it,’ he says.



What Telegraph readers may not yet realise, but will if things really

take off, is that Gavaghan and his team of 18 plan to do more than wait

for responses to roll in. ’Advertising our offers in the paper is a way

of recruiting people. A good 70 per cent of the business is behind the

scenes through direct mailings. This isn’t intended to support

circulation,’ he says.



The T Collection, and three other services to be launched in the coming

weeks, are only the tip of a massive direct marketing iceberg, developed

in conjunction with the Telegraph’s development director, Tony Coad, and

its four databases, held by Alchemetrics and Hart Hanks/IFM.



The reasoning behind the direct-sell initiatives is two-fold. On one

level, they extend the kind of one-off readers’ offers that

traditionally the Telegraph has done very well, with each expected to

make a profit even after paying for its own ad space. Gavaghan calls

them a ’third-party revenue stream’ after circulation and

readership.



The other is to keep readers loyal. Gavaghan says the products on offer

are about value for money and reliability - and the approach seems to

work; offers sell despite their prices being comparable with those of

competitors. Feedback shows that even when they buy holidays or tickets

for sports events, purchasers believe their applications will be

prioritised by being a Telegraph reader.



’A Telegraph-endorsed offer will outsell an unendorsed one by 30 per

cent,’ says Gavaghan.



Perhaps this affinity is not surprising, given that products and

services are devised using market research to find out what readers

want. Only then are manufacturers, service providers and fulfilment

houses contracted to deliver the concept. Once commissioned, the paper

has little to do with the merchandise.



Products are developed by using information gathered from customised

questions on the Telegraph’s lifestyle questionnaires that supply the

group’s Lifestyle database of one million. As questions on products

become more specific, questionnaires targeting only 20,000 to 30,000

people are sent out, sometimes eliciting 70 per cent response. Focus

groups are then used to finetune the idea.



But using the companies’ sophisticated databases for offers is a two-way

street, and most direct selling provides as much information as it uses,

helping the group’s other below-the-line initiatives. The Telegraph’s

transactional database stores and segments information on 5.5 million

people who have responded to offers in the past, which is then used to

mail information on offers not necessarily advertised in the paper.

Respondents to recent golf offers, for example, are now mailed with a

quarterly newsletter which bypasses the paper entirely.



In theory, the idea of constructing a highly targeted direct mail

programme aimed at newspaper readers is a good one. The audience is as

well defined as any other and the scale of the Telegraph’s operation

must minimise the chance of poorly targeted, intrusive communications.

But because the programme is still in its early days, few readers will

have been exposed to its full scope, making it hard to assess what the

irritation factor could be.



Perhaps it is this that makes the paper’s competitors sound so relaxed

about what is going on next door. Few do more than produce the odd offer

themselves and that’s how they want it to stay.



Michael Halstead, the joint managing director of the sales promotion

agency, HH&S, which works for Associated Newspapers, says: ’You have to

be careful that you are building the brand rather than cashing in on it.

If you had responded to a gardening promotion, how would you feel being

hit by offers for other things?’



Tony Watson, the managing partner at Lowe Direct, which handles Times

Newspapers, adds that own-label products could alienate existing

advertisers as well as readers. He cites the fact that the Telegraph

scrapped plans to launch a discount brokerage service last year after

financial advertisers complained. He adds: ’It starts to look like rank

commercialism if you aren’t careful. They are following Richard

Branson’s lead, which is one thing if you are a manufacturer but it’s

different if you are a media owner.’



Whether the Telegraph manages to strike the right balance remains to be

seen, but one thing is certain. Its readers are not shy and if they feel

intruded upon, they will make their feelings known quicker than you can

say ’junk mail’.



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