Reaching The RichOur Work — By Lois Geller
PaineWebber was a well-known investment firm. (UBS absorbed them a couple of years ago) They came to us through their ad agency.
PaineWebber had a new service called Insightone. It was designed to appeal to people with over $500,000 in liquid (investable) assets. The ad agency would create a few commercials and we would do the direct mail. We wondered why they’d spend money on commercials to reach so few people but we were a guest agency and stayed mum.
The client had already tried to do direct mail on their own but it didn’t work at all. They did have a house file of potential investors, though, and they wanted us to use that.
We did a little homework first. PaineWebber made a 1.5% annual commission on every account. The minimum Insightsone account had $500,000 in it and 1.5% of 500 grand is $7,500. We figured we could spend a few bucks to reach the unreachable… rich people.
We spent a little extra money on first class postage (live stamp), high end typed name and address matched to the letter and a fairly expensive premium… a hard cover book written by a TV personality who worked for PaineWebber. We tested 6 different markets and 5 different letters. We also tested using a nice brochure versus no brochure (and learned that the brochure actually depressed response, a phenomenon we’d seen a few times in the past with high net worth prospects).
Perhaps most important, we tested a whole bunch of outside lists with carefully chosen selects against the client’s house file and beat the house file by 70%! Bingo!
Once we analyzed the responses to all the tests, we figured out that we could probably generate a 3.5% response nationwide. We had discovered a goldmine.