A Black Market with Big Prize
How would you like to be in the mail-order business, with a company that is 40 years old and still grows at the rate of 40% a year? There is such a company. It is called Charles Velkes International.
Phil de Winter, the general manager, gave me the tour. I happened to have the opportunity to meet Phil on one of my trips into South Africa to do some seminars. He invited me to be his guest for the day to see his operation.
Let me share the story with you.
The company sells throughout the southern part of Africa and even a few of the islands in the Indian Ocean. In addition to South Africa its products are distributed in Botswana, Malawi, Lesotho, Swaziland, Mauritius, and the Seychelles.
The average customer is a 33-year-old female, 4% have graduated from high school, the average family size is 6 and they speak the "local" language at home.
If you have not figured it out yet, Charles Velkes International is a mail-order catalog operation selling household goods and is aimed directly and solely at the black marketplace in Southern Africa.
It has been a leader in mail-order marketing for over 40 years. It has a large loyal customer base who hear from Velkes frequently.
It has been a leader in new technology and was the first company to offer a 24-hour toll-free number. All of its orders are shipped within 48 hours. It is a member of the South African Direct Marketing Association.
Because a large percentage of its marketplace is not credit card orientated, 95% of the orders are shipped through the postal system, cash on delivery.
Here is how the system works. You get the latest Charles Velkes catalogue. You mail in or telephone your order. If your order is over "X" amount, you send a deposit. The order is received, processed, ans shipped to the post office nearest to you within two days.
At the same time, you are sent a post card letting you know the package is on it way and within a day or two you can come to the post office to pick it up.
When the package gets to the post office, the post office advises you it is there. You bring your money and identification, and collect the package. It is really very simple
And if for any reason you do not show up within a reasonable time, the post office will remind you again to do so.
Over the last several years, premiums have been introduced. And they work! They boost sales. They boost the average order and they boost the frequency of orders.
Charles Velkes has a wide household product line. A heavy concentration in women's clothes and household goods. Selective items for children and men, but still relatively extensive.
It has found that by doing special catalogues for special seasons or special product lines, that also increases sales. It has a special women's-only catalogue. It has a special household products catalog.
Recently it also introduced sweepstakes. Velkes was not sure what was going to happen. But by offering a Nissan automobile as the grand prize for orders placed within a limited time, it not only increased its percentage response rate and average order, but it more than paid for all the prizes. Sweepstakes have worked extremely well, and they are continuing to do them.
Sometimes the sweepstakes are for cash or something similar, in addition to merchandising prizes. The sweepstake packages look very much like those that we see in the rest of the world, those put out by Reader's Digest, Time-Life Books, and such.
I guess what all this tells us is that people are people. And that direct marketing is alive and well everywhere. And with a good product line offered in a professional fashion to the right audience at the right time with the right office, you can be successful.
Charles Velkes International certainly is.
by ROCKINGHAM*JUTKINS*marketing, all rights reserved.