Continuity marketing

Continuity marketing is a method of providing goods or services to consumers that relies on direct marketing and continues into perpetuity. Also known as auto-replenishment, this relationship continues until the customer decides to end it by notifying the marketer.

Overview

The general concept is that a customer places an original order, typically through a mail order offer or online. This original offering is usually heavily discounted and acts as a loss leader. Within a prescribed period of time, a subsequent shipment will be delivered to the customer. Thereafter, additional shipments will continue to be sent at regular intervals. If the customer has not indicated which specific product they wish to receive, then the marketer will choose for the customer's on the basis of that customer's previous choices. This continues until the customer notifies the supplier of their choices or their desire to discontinue the service.

This has been a primary distribution method for well-known book clubs, such as Doubleday and Harlequin, and music clubs, such as Columbia House. International Masters Publisher has distributed millions of recipe cards internationally in this fashion.

Unlike the questionable marketing practices of some companies, modern successful marketers use very clear and deliberate language, repeated several times and located prominently, to explain their program. However, many customers fail to, or refuse to, understand the continuous nature of the offer. While pleased to receive the deep original discount or free sample, the customer often misses the opportunity to review the terms and conditions. When the next shipment arrives with an invoice, these consumers become agitated and resentful. This avoidable experience unfortunately results in a considerable waste of resources, including customer-service calls, returns, and lost goodwill.

References