That's Entertainment!

Folio: The Magazine for Magazine Management, June 1, 2001 by Thom Weidlich

Electronics direct marketer Crutchfield massages customers with e-mail messages

Crutchfield Corp. sells electronics for house and car, including home-theater systems and car stereos. It also specializes in video and photography (but not computers).

According to Alan Rimm-Kaufman, Crutchfield's vice president of marketing, the company sells more in these categories from its Web site than any other big seller, including Amazon.com. Its main competitors are large brick-and-mortar retailers like Circuit City and Best Buys.

The company, based in Charlottesville, VA, was started in 1974. Founder Bill Crutchfield used a typewriter to lay out the copy for his original catalog--on his mother's dining room table. The company now has 520 employees and exceeds $200 million in annual sales. It has 2.8 million previous buyers and 8 million active names in its database.

Crutchfield prides itself on selling thorough information, because installing a car stereo or setting up a home-theater system can be intimidating enough to scare people away from buying. To convey much of that information, the company uses e-mail.

Rimm-Kaufman says Crutchfield decided it would take a soft, informational approach to its e-mail programs. "Some of our competitors send very promotional e-mail--it's sell, sell, sell! Ours are informational. There's a depth to them."

He adds: "The positioning is that it's an information device: How does digital photography work? Can I mail Grandma the kids' video? Can I have MP3 in my dashboard? Then we have links back to our site: 'To read more or to see products, click here.' It's a very soft sell."

Crutchfield sends out its monthly e-mail newsletter, which it began about a year and a half ago, to 550,000 subscribers.

In fashioning the creative on the e-mails, the company has a distinct advantage. It does all the creative for its 160-page catalog (mailed three times a year to 7.5 million names each drop) and its 50-page book (four times a year to up to 5 million names) in-house and has from 20 to 25 writers and designers on staff. The scribes also write the online copy, of course. "In the catalog every word counts," Rimm-Kaufman says. "They appreciate writing online because if it takes a few paragraphs to explain a feature, they go for it."

The content is about the products and electronics generally, with a few exceptions. "When we come back from the Consumer Electronics Show, we do an article about that-gossip from the show, what's coming down the road," Rimm-Kaufman says. "People really like that."

And yet despite the soft sell, he says the e-mail newsletter generates more frequent purchases, though he declines to disclose numbers.

Everyone gets the same newsletter. "We don't have enough information to segment," notes Rimm-Kaufman. "A lot of these people are only e-mail addresses. I don't know anything about them. They're not on the house file."

But, interestingly, Crutchfield sends follow-up newsletters based on what people read in the first newsletter. "If there are four articles and one is on satellite TV and a huge number clicked on that," he says, "a week later we send a follow up with more information on satellite TV to readers who clicked on the link in the original piece."

In addition to the monthly newsletter, about four times a year Crutchfield sends out hot-deal messages.

In other e-mail, Crutchfield sends a thank-you note about a week or two after delivery, asking customers if they have any questions. This is in addition to the purchase receipt and the e-mail notification of shipment. The thank-you note helps to confirm the purchase in the buyer's mind.

The real one-to-one is done in the company's e-mail call center. Crutchfield reps--phone and e-mail--get eight weeks of training before they can talk to a customer. "They're not order-takers, they're real salespeople," insists Rimm-Kaufman. "The support they provide is tremendous." Crutchfield customers get free online technical support for the life of a product. Response to e-mail is guaranteed within a day but is usually done in hours.

All this massaging through messages is done for an important reason: Crutchfield's products are expensive. The average purchase is more than $300. The company's customers do a lot of research before they buy and the company's best source of new business is referrals.

That's why Crutchfield also goes to such lengths to provide information overall. Rimm-Kaufman says the company does its own profiling of each product in its database. On every product at the site it lists what's in the box. The site shows pictures of the back of components so surfers can see, for example, whether it has two audio inputs. "If the product is unique," he adds, "we could have 10 pictures." The in-house people measure every product and every car rather than rely on spec sheets, so descriptions have exact dimensions.

Though Web orders are processed automatically, each is reviewed by a representative--especially with car orders--to make sure the product will fit. "They can order something that doesn't fit but we follow up right away with a phone call to make sure it's what they want," Rimm-Kaufman says. The site has a popular feature called "What fits my car?" to allow users to determine what stereo systems are right for their make and model.