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Santa was good to the folks at DiscoveryStore.com over the holidays — stuffing his sack with plenty of Night Vision Communicator Goggles, Remote Control Pterodactyls and the best-selling Remote Control Z-Cars, not to mention “toys” for grown-ups.

The reason for his largess was an e-mail campaign to drive people to the Web site that performed better than any before. And the effort boosted revenue generated from e-mail by 74% over the year before. The average dollar sale on the Web site (www.discoverystore.com) shot up 18% from the third quarter.

This was the first time DiscoveryStore.com used e-mail to increase traffic.

The e-store had swelled its database to 400,000 throughout the year — enough e-mail addresses to really make a splash in a major communication.

The addresses came from two sources. One was a loyalty program, Discovery Passport Rewards, which people sign up for at the point of sale — online, catalog or in one of Discovery's 160 stores. They are awarded one point for every dollar they spend.

The other source was a file of subscribers to a free e-newsletter that people requested at the point of sale.

The holiday campaign put the newsletter program on hyper-drive, increasing broadcasts from once or twice a month to once a week, and refocusing the creative from product offers to attention-getting special promotions.

The first promotion launched the Wednesday before Thanksgiving and ran through the following Monday. It offered 30% off on any purchase on the site of $100 or more and could be shared with recipients' friends and family members. The conversion rate was 5.4%.

“This was the strongest performer of the year,” enthuses Doug Lerner, e-commerce marketing manager at DiscoveryStore.com.

The other promotion was a double-points program for Passport members that ran Nov. 15 to 17. Members received 200 points for every $100 they spent. This was open to all 2.2 million Passport members online and offline. The conversion rate on this transmission was 4.6%.

The double-points promo employed Flash technology, which let the recipient interact with pictures of 10 to 15 top-selling products right in the e-mail, as though it were a mini-catalog. With Flash, users click on what they like and read the description. When they click on “buy now,” they land on the specific product-ordering page.

“People like the interactivity of Flash,” says Laura Peck, senior account manager at New York-based CheetahMail, which manages DiscoveryStore.com's e-mail program.

CheetahMail ensured that even people whose browsers don't read Flash could easily click to a Web page that perfectly mirrored DiscoveryStore's pages.

Smart segmenting employed recency/frequency/monetary models to deliver the best-targeted offers. For instance, someone who'd never ordered would see a cheaper item than the person who'd ordered multiple times.

“If you show that person a product that's selling well with others and it's $9.99, it might do better than a $200 telescope,” Lerner points out.

Omniture software gave DiscoveryStore up-to-the-minute reporting.

“If something was a dud, we pulled that,” he says. “If something sold, we worked fast to get it in front of customers.”

The e-mail promotion was part of an all-out effort to drive sales throughout the division for holiday 2002. It included sending out 66% more catalogs than usual (annual circulation is 2.5 million) and heavy television marketing pushing all three channels.