As part of its effort to help independent booksellers market their stores more effectively, the American Booksellers Association has rolled out a new fee-based program, Local Marketing Intelligence. LMI is designed to help booksellers identify just how far their customers travel to shop--whether they live or work within a three-, five- or 20-mile radius of the store, or more--analyze which zip codes generate the highest sales and identify age groups or ethnic groups that may have been left out of marketing plans.
Michael Hoynes, marketing officer of the ABA, told PW, "The idea behind the project was to adapt some of the proven strategies of consumer-marketing companies for bookstores. It's not about spending more money on marketing, but about being smarter. We know our corporate competitors are out there doing this, too. It's all about person-to-person marketing." Based on data that the ABA compiled from 20 general and specialty bookstores that participated in a year-long test pilot of LMI, Hoynes said, "Most of the bookstores found that their market was better than they thought it would be. What came out was that they knew things about their area, but they didn't put them into marketing."
In order to participate in LMI, stores have to provide a database of at least 1,500 customers. The ABA then compares this database with U.S. census information for the area. Roxanne Coady, owner of R.J. Julia Booksellers in Madison, Conn., signed up for the pilot because she was worried that her store had saturated its market. "At first blush," she said, "it looked like we had plucked all the low-hanging fruit. But we found pockets like young families on the lower end of the economic scale." What appealed to her about LMI was that it offered an inexpensive way to reach her customers. Simply put, she said, "We're out of marketing dollars, and we can't keep mailing to 23,000 people on our customer database."
By targeting shoppers using LMI, Coady hopes to get a bigger percentage of purchases for R.J. Julia from current customer and to gain new customers. ABA statistics show that independent bookstore customers buy 20 books a year, but only an average of eight from independents. In fact, only 39% of adult books are purchased in a retail bookstore whether chain or independent. For booksellers uncertain about taking the plunge, Coady advised, "I think if stores are going to survive and grow, we need to do this."
In order to continue collecting marketing data about her customers, Coady is in the midst of revamping her frequent buyers' book club. At the same time, at the ABA's suggestion, she started doing monthly business card drawings for prizes as a lure to build her e-mail customer list. Between May and August, she collected 2,500 addresses. Coady acknowledged that some people, like her husband, Kevin, are turned off by the Radio Shack—style approach, which gathers point-of-purchase customer information on every transaction, but most are happy to be part of grocery store and drugstore discount card systems like one begun by the CVS chain this summer. "Our customers are being marketed all the time," she said.
ABA CEO Avin Domnitz underscored the importance of gathering data about customers in order to better target marketing efforts. But, he noted, "if the person doesn't want to give the information, you have to respect that. The key word is permission. There has to be some value."
Although 10-year-old Reading on Walden Bookstore in Chicago is much smaller than R.J. Julia, co-owner John Presta faces many of the same challenges when it comes to sustaining growth. "One of the things we found out," he said, based on his store's participation in the LMI pilot, "was the biggest buyer of children's books is grandparents. People stay in our community for 20 years or more. We don't get a lot of movement." By marketing children's books to grandparents and by following LMI's suggestion that he not overlook the students and faculty at nearby St. Xavier, a small Catholic university, Presta's sales have risen. "We're up about 30% in sales," he estimated.
Another pilot program participant, Chuck Robinson, co-owner of Village Books in Bellingham, Wash., has also fine-tuned marketing efforts based on information provided by LMI. "It did a couple of things for us," said Robinson. "We were doing a lot of the right things, but we found that over 20% of the people in our frequent-buyer database live more than 20 miles from our store. One of the things it said to us was to continue our outreach marketing and really beef it up." The other thing Robinson learned was that "we have a large number of retirees coming into our community. We knew that to some extent, but one thing that the ABA has underlined is the grandparent market."
As a result, Robinson began a radio campaign on the importance of reading with and giving books to grandchildren. He also added daytime programming for grandparents unwilling to come out at night. One recent daytime event, which was very successful, offered advice on how to pick books for your grandchildren.
As it did with Coady and Presta, the ABA encouraged Robinson to update information on his customers more frequently. Although he tried to do so every year, Robinson conceded that in the past he hadn't made it a priority. With the added push from LMI, last December Village Books got 1,000 updated addresses, as opposed to 250 the year before. In addition, the e-mail list grew by more than 300 names to 1,700.
For Robinson, the response has been proof positive that "just changing a couple things can make a big difference," he said. "You can redirect your advertising dollars in a way that makes more sense. You need to figure out who your best customers are. Most of us don't have the background to do that."
LMI is not a replacement for other marketing efforts, booksellers say. But as the pilot program participants found, it does offer a chance to level the playing field by giving independent booksellers the same in-depth information about customers that their larger land-based and online competitors have. Most important, LMI helps booksellers use that information cost effectively as they market to one person at a time.