One Win, One Loss
REBOUNDING AFTER THE bittersweet launch and closing of a chocolate catalog, Miami-based Activa Marketing & Investment Group L.C. is readying a second mailing for its Fine Rose Club, a fresh-cut rose continuity.
Activa president Jose R. Azout says the program debuted this spring with three 50,000-piece mailings in March, April and May to names from upscale files such as home decorating lists. The initial mailings generated a .5% response which Azout feels is respectable for the continuity, especially considering consumers are likely wary about purchasing flowers by mail during hot months.
For $49.95 (plus $7.50 shipping and handling) members receive a dozen roses along with filler flowers and greens via Federal Express once a month. Each delivery includes a different rose variety and information on that flower (from locales such as Ecuador, Holland, California and Colombia), fresh-cut flower food, and care and handling instructions. New members of the club-which was started with a $200,000 investment-receive a free vase and pair of shears.
Azout was positive about the fact that not one customer has canceled since the program began, and the replacement rate on the flowers was below 1%. “We ran a great risk because we offered a seven-day guarantee [that the flowers would remain fresh].”
Limited outbound telemarketing has been tested, and a freestanding insert was slated to run in The New York Times last month. For the fall mailing, the focus may shift more from doing something nice for yourself to giving the roses as gifts (50% of the spring orders were gifts). Future plans may also include a B-to-B version of Fine Rose, for businesses that would like to receive fresh flowers weekly.
Activa (www.activamarketing. com) was founded in June 1997 by Azout and his family as a venture capital firm specializing in the direct marketing industry. The company is seeking out small to medium-sized second-stage DM firms with positive response rates, but not the management expertise or capital available to grow.
Azout had no prior experience in DM-he was in the fresh-cut flower business-but he did have a dream: To start a chocolate catalog.
“I loved chocolate and was always looking for new brands and flavors,” Azout says, noting $400,000 was invested in the project. “I figured there must be other people who felt the same way.”
(He wasn’t the only member of his family with a valiant DM dream that didn’t quite fly. One concept Activa tested early on was an Internet golf-joke service. For $39 a year, subscribers would receive a joke a day: “We had one subscriber,” Azout admits.)
Activa dropped two 150,000-piece mailings of the International Chocolate Connoisseur catalog in March and May. The ambitious 16-page effort featured chocolates from around the world, including Italy (Pernigotti), Holland (Droste) and Belgium (Cafe-Tasse). Over 40 lists were tested, including buyers from upscale food, apparel and jewelry catalogs, and chocolatier subscribers. None pulled higher than .5%, and the average was .25%-too low to warrant another mailing.
“We discovered that with the exception of gifts, chocolates are an impulse buy,” says Azout, noting that companies like Godiva, of course, do gangbusters with gift business.
Now, the company is positioning itself squarely in the venture capital seat, looking for companies to invest in. Proposals-including a program for marketing old radio shows and several vitamin and health catalogs-are being considered.
