Columbia House radio campaign drives Internet traffic and new member enrollment

Columbia House Company, best known for its ridiculously low introductory music offers, finally took the plunge this past spring and took its message to radio.

Columbia House Company, best known for its ridiculously low introductory music offers, finally took the plunge this past spring and took its message to radio.

This is a company that in its 46 years of business has rarely swayed from its dogged strategy of pumping up membership with print ads in publications like TV Guide and free-fall inserts in newspapers across the country.

According to Ben Edwards, company president, the strategy has actually changed somewhat over the past few years, moving away from mass media to focus on more targeted direct mail programs, renting lists aiming at prospective members and using its own database to re-activate cancelled past members.

This then begs the question: Why radio and why now?

‘There’s been a significant shift in the media scene in that the traditional space media is not as productive,’ says Harjinder Atwal, executive VP and general manager of Columbia House Company. By using radio, the company is hoping to reach those who haven’t, for whatever reason, seen or bothered with the traditional print material. Unlike the print material, however, this campaign was created specifically to develop more awareness of – and participation in – the company’s Web site, launched in 1996.

The site, www.ColumbiaHouse.com, represents a key element in the company’s new membership acquisition strategy. Targeted e-mail prospect mailings, banner ads and button links on third-party sites have all been used to promote the site. And it’s popular. A good 20% of the company’s sales are over the Web, says Atwal. The company wants and expects this number to grow, particularly since it added a DVD Club to its roster a year ago.

The four 15-second radio spots hit the airwaves in a month-long pilot program in Calgary, Edmonton, Toronto and Ottawa. Three of the spots targeted music lovers of various genres – country-western, rock and hip hop – while the fourth targeted film lovers to promote the company’s Video Club.

‘They were a lot of fun,’ says Mark Weisbarth, president of Due North, which handled the test campaign. The spots feature caricatured narrators built around different genres of music (picture a Spinal Tap type character for the rock spot) discussing the benefits of logging onto the site. Everyone is familiar with the Columbia House message, according to Weisbarth. The upfront payoff in joining – 12 free CDs, five videos for five cents or four DVDs for 49 cents each – is what attracts people to the notion of the club in the first place. ‘It’s kind of a no-brainer,’ he says. The challenge was driving people to the site with the offer, he says. ‘The effort was all about pushing it online.’

Pushing it online makes sense, not only from a data management point of view – Atwal says online will translate into improved service and reduce costs – but also because the profile of the typical online member is so much more attractive than the core members achieved through more traditional means.

Company research shows that hard rock and roft sock, combined, account for about half of core active members, while alternative and country account for between 13% and 15% each. Meanwhile, four per cent of core members are classical/jazz enthusiasts, while another three per cent tend to order Christian music.

The median age of Columbia House members, achieved through traditional direct methods, is 33, with a slight female skew. Over half of the members have children at home, 58% have PCs and 45% have Internet access. Less than a quarter of core members – 23% – identify themselves as heavy CD buyers.

Pit this profile against the Web site joiner. They’re more likely to favour the dance/pop and alternative categories, and far less likely to be country or soft rock lovers. They’re also more likely to be male. But, most importantly, they’re younger, with a median age of 24, and a good 16% are actually under 18. Best of all, 30% indicate heavy prior CD purchases, compared to only 22% of non web joiners.

In fact, Columbiahouse.com is consistently one of the top sites in the Canadian market with on average about 250,000 unique visitors per month (source: Nielsen). In the past two years, according to Edwards, it’s enjoyed a sales growth of 36%. A younger demographic and higher buying activity could translate into more profit for the company if it could further rev up the online business.

The radio test campaign increased Web traffic and new member enrolment both during and after the campaign, according to Edwards. He says that the company may consider radio again.

For now, the company is looking towards improving the site, allowing members means to access their account and track purchases. If all goes as planned, the company will also be involved in some push technology efforts in the coming months, he says.

The Internet is playing a crucial role for music lovers. Witness the popularity of sites like Napster – a serious bane on the entire music industry, but especially for online music sellers like Columbia House.

‘A significant number of Canadian music buyers had been downloading music online,’ says Atwal. ‘This affected every music company’s bottom line. The shift towards pay-for-use service that Napster is undergoing will probably resonate with other online music providers, he admits.

For now, he won’t disclose what this may mean for the company’s online presence – whether or not it, too, will move to offering immediate access to music – but he says that it is something the company would consider if the public clearly wants it.