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In Hallett, South Australia a retail store ran a Direct Mail campaign to current and potential customers in surrounding suburbs. Sales increased dramatically. The same store, this time in Wangaratta, Victoria has had a loyalty program in place with local schools for over 6 months with equal success. And in Boreen, Queensland the local sports team sponsorship that has been in place for 3 years has increased that store’s name recognition and profile in the local community.
What these and 100’s of other marketing campaigns have in common is that they’ve been created and implemented using the same head office developed system: Local Area Marketing.
Individually, none of these local campaigns will feature in Marketing or any other national industry magazine. Collectively, however they are one of the key secrets behind the success of a variety of organisations.
Because it flies beneath the radar, LAM is not a marketing strategy that receives a great deal of attention. That’s starting to change. Organisations as diverse as McDonald’s, Caltex, Transperth - Perth’s public transport authority - and Chemmart rely heavily on LAM as the cornerstone of their local and regional marketing efforts.
Traditionally, LAM has been seen as particularly suited to franchise organisations. With the success and the marketing / cost-efficiencies if offers, however, LAM is fast being taken up by organisations in a variety of industries and fields that need to ‘do business’ locally.
The reason for this is that LAM is an incredibly efficient and effective way for multi store / outlet / office organisations to ensure that their overall strategies and tactics are successfully interpreted and deployed at the grass roots level. Plus, LAM gives each outlet the flexibility to react to local conditions. A well researched and implemented LAM program can become the quasi-marketing department for each outlet.
At the heart of the program is any number of ‘pre-packaged’ marketing solutions. One of the LAM programs we created for a major retailer contained over 15 campaign modules including Direct Mail campaigns, a local school loyalty program, new store opening promotions, 2 for 1 offers and POS. With changing conditions, modules were added, amended and deleted.
It’s all well and good to come up with a snappy national advertising campaign that runs for a limited time. But what’s going to make the prospect walk into your outlet in suburban Darwin and put their money down 3 months after the campaign has finished?
While the scope and style of each LAM program can differ according to each organisation’s needs, the program’s major benefits include:
1. Brand Protection & Consistency
Nothing frustrates a Marketing Manager more than to see their brand footprint crucified by a promotion or POS created by an over-zealous local store manager whose 3rd cousin runs an instant print shop down the road.
LAM ensures that while the local activity is easy for the local store to implement it also conforms to exactly what Head Office wants to do with the overall brand.
2. Cost Reduction
Instead of starting from scratch every time there’s the need for a new activity, there are templates already in place. Customised materials can then be easily created with only slight changes for local relevance.
When a new activity is developed for a specific area or outlet, the template can then be added to the LAM program so that the other outlets can take advantage of it. Of course, what this does is amortise the development costs over many rather than just the one campaign.
3. Increased Profits
According to the General Manager of a medium sized organisation, the outlets that are more active users of their LAM program are more profitable than those that are not. The challenge for Head Office is to convince those less involved franchisees / managers of the simple economics that greater compliance = greater profits.
4. Local Flexibility
The competitive environment may vary dramatically from one suburb to the next. When a direct competitor opens up next-door and slashes prices by 30% you need tools that will help you NOW.
LAM is tailor made for situations like this. By becoming that store’s quasi-marketing department when it needs it most, the outlet manager / owner is able to respond quickly and implement relevant responses.
The growing popularity of Relationship Marketing coupled with technology advances – internet / email / mobile phones / wireless / CRM software / digital printing – has really seen LAM come into its own. It has never been easier and more cost-effective for organisations at outlet level to form more profitable relationships with their customers.
Consumer cynicism and education is increasing so the more the organisation is seen to ‘understand me and be one of us’ the greater the chances for success.
With traditional media fracturing, LAM is essential for national or regional brands to take the final step locally. It’s essential that the key messages from your national campaign trickle down effectively. Inadequate planning as to how it can work at store level blunts the impact of too many expensive national campaigns.
Support materials that reflect the national campaign are important; so too are the follow-up complementary activities that help to close the sale.
Deciding what to do and when to do it should not be left to outlets alone. As it’s unlikely that every franchisee or outlet manager has a marketing background, every LAM program should include some form of a DIY ‘ready reckoner’ that allows outlets to enter their specific conditions and then come up with the best solutions.
So what steps do you need to take to set up a functional and flexible LAM program?
Overview
What does the organisation want to achieve? How do the outlets fit into the organisation’s overall objectives and plans? Does the organisation see itself as an active community citizen? What specific programs will be most effective when rolled out in local areas? The answers to these and other core questions serve as the foundation of the LAM development process. This ensures that all marketing initiatives – no matter where and when they are implemented – are integrated and are ‘on message’.
Marketing Planning
No one knows their area better than those who live and work in it. That’s why a robust LAM program enables each outlet to create its own Marketing Plan and activity schedule. Head Office can assist in its preparation by providing research, market trends and customer profiles. Once completed, Head Office or the Area Manager can check and approve the plan.
The types of program modules that should be included will vary according to the type of organisation and the market / s in which its outlets compete.
LAM programs often include the following modules:
Updating and refining modules is simple, particularly if the program is accessed via a password protected website. Once the program has been set up, an LAM program can run for years. We helped launch the Caltex Local Site Marketing Program in 1998 and it has grown every year since. It has now been rolled out in New Zealand and consideration is being given to further regional expansion.
Training
Training is critical with every LAM implementation. Simply sending out a web link or a large ring binder and hoping everything looks after itself will see it ignored. Training does not need to be intensive. A good LAM program should be easy to understand and implement, but it must cover the fundamentals to guarantee maximum compliance.
Project Management
Project Management is the engine room of LAM. Dozens and sometimes more individual projects are ordered from outlets at the same time via fax or email. Without well oiled Project Management processes and resources in place, LAM can fall in a heap. This is why most organisations, regardless of their size, outsource the development, implementation and management of their LAM programs to experienced and specialised marketing companies.
Launching the program alone is not enough. The success of LAM is dependent on it being successfully integrated with all the other organisation’s processes. Putting in place a program telephone hotline and a ‘field support’ resource responsible for visiting outlets to help with program implementation – particularly soon after program launch – are excellent ideas.
On-going support and reinforcement of the benefits of LAM at the outlet level will help the program to deliver maximum results for the organisation. Like most marketing programs, LAM is not a ‘set and forget’ process.
As each outlet is now its own marketing microcosm, activity performance and ROI can be assessed as per any campaign. Simplifying the measurement of results should be a process that forms part of the LAM package. How far you drill down with the evaluation – by campaign, outlet, area, state or nationally - is up to the needs of each organisation. Some organisations simply use the number of LAM activities implemented by each outlet for the preceding period as part of their KPI process.
Analysis of the impact of the overall program should be undertaken on a regular basis. Set the initial control benchmark and then assess the changes over time. Measurement and evaluation can be as flexible as the LAM program itself.
The power and simplicity of LAM provides so much for organisations at every level.
For the outlet, LAM delivers ‘structured marketing autonomy’. Which is infinitely more empowering than Head Office sending out generic programs and hoping they are relevant for every outlet.
For the Head Office marketing department, there is comfort in knowing that the brand is in safe hands, that there are no divergent campaigns being attempted and that national initiatives are being reinforced locally.
And for senior management, LAM helps to increase profits, reduce costs and enhance team morale.
Finally, LAM works for communities. It helps to provide jobs, creates local ‘news’ and better integrates the organisation into the local community.