Tag Archive for Deliver Magazine

Direct Mail is Adapting

In the August issue of Deliver Magazine, the editors make a case for Direct Mail’s future.

Direct mail is entering a new age. Long an effective marketing device, mail is now being linked with new technologies in astounding ways that improve its effectiveness and bring a new engagement. It wasn’t supposed to be this way. Emerging technologies were expected to take what direct had done, and do it better, faster and cheaper. Consider the irony then that far from killing it off, digital is helping usher in this new era of direct mail.

Of course direct mail and digital have always been buddies. Mail was the primary way most of us learned about the Internet. (Remember those ubiquitous disks from a major online company?)

Catalogers have always known that mail can drive additional sales and online visits, and many digital entrepreneurs have turned to the mailbox to drive people to the inbox. The difference today is that marketers are now finding methods for combining digital technology with mail to increase the power of the message. Mail is no longer the carrier, the device you use to drive someone online. It’s the beginning of a conversation that carries on once the customer logs on.

Clearly, the efficiencies of mail — its laser-like ability to target customers, paired with a way to expand that message — is making marketers rethink their opinion of what many regarded as an “old” advertising vehicle.

It’s about the convergence of traditional and digital, yes, but that’s just the start. What we’re witnessing is a revolution that will launch mail into the next generation and beyond. It’s another lesson in the amazing adaptability of mail.

Marketers would be smart to take full advantage of this flexibility. And smart marketers do.

The Power of Mail

In a column for Deliver Magazine titled “Power in the Mailbox” author Steve Cuno, told about a friend who received a personal note from the president of her bank, just to check up and make sure the bank was treating her well. Thanks (perhaps ironically) to e-mail and the Internet, direct mail may now be much more powerful than ever.

A number of unique factors work in direct mail’s favor. One is called “willing suspension of disbelief,” our ability to set aside reality and lose ourselves in a story. When a direct mail letter shows up in a personally addressed, stamped envelope, part of us wants to believe that someone took a moment to compose, print, address and post it, just for us. All the better if the letter calls us by name and bears a signature in fountain pen–evoking blue. A good writer can make an e-mail blast sound personal, but there is no electronic substitute for the look and feel of a signed letter in a stamped, addressed envelope.

Willing suspension of disbelief knows no demographic limitations. Had the friend mentioned above paused to analyze, she would easily have seen that the letter in her hand was direct mail. But — and this is the point — she chose not to pause and analyze.

Whether or not your direct mail includes an envelope or sales letter, it appears that the public would rather receive advertising mail in a mailbox than on a computer. Higher response rates provide one indicator. The near-overnight appearance of spam laws and filters provides another. No sooner had e-mail blasts arrived than the public demanded laws restricting them, servers blocking them, and junk filters dispatching them.

By contrast, laws governing physical mail are far less restrictive, despite more than 200 years of opportunity to enact them — and for good reason. While it remains disturbingly fashionable for legislators to tilt against direct mail windmills, Congress was quick to recognize spam as a problem and take immediate action.

Besides indicating a market preference, the absence of such controls offers a practical advantage. Everyone must look through their physical mail in order to decide what to read and what to chuck. Not so with e-mail. There, one click and your beautiful offer is gone forever.

People have always looked forward to getting their mail, and still do. Most people can tell you what time their mail arrives. Most bring it in daily and eagerly dig through it. They’re not looking for bills. They’re looking for letters — and, increasingly, relevant advertising mail.

This is why we and others find that intelligent, well-targeted direct mail continues to perform as well as, and often better than, ever. Your offer can be the one that people willingly open, read — and act upon.

E-mail and other online media are useful and powerful in their own right. We appreciate that you are reading this post online. But when planning a direct response media mix, it’s important to remember that there are some things that a mailbox can deliver that a monitor just can’t.

Seventy Six

Seventy six is a pretty big number. That is the percentage of internet users who were directly influenced to buy an item or service thanks to direct mail. This fact appeared in the March 2010 issue of Deliver Magazine and they stated the source as a Channel Preference Study from Exact Target.

Courting a Wary Customer

Deliver Magazine and Sid Liebenson suggest three ways to build and maintain loyal relationships when customers are running scared.

Consumers are retrenching, economizing and just plain scared. But as the saying goes, the pessimist sees difficulty in every opportunity, and the optimist sees opportunity in every difficulty.

The recession presents the perfect opportunity to finetune your marketing efforts that will build loyalty among your current customers. It also is the prime time to go into acquisition mode and attract competitors’ customers to your brand. Here are three ways to do it:

1. Get personal. Consumers are vulnerable in a down market: They’re rethinking their brand loyalties as they look to economize and reconsider what they value in a brand. Keeping your customers means personalizing like you’ve never personalized before.

Mine your data to let your customers know you understand what’s important to them. For example, you might send a message on a catalog overwrap saying, “In the spring, you bought this lightweight cotton sweater from us. Now that it’s fall, here’s what people who bought that sweater are buying now.” This shows you care about what they are thinking, and there’s some logic to what you’re recommending — you’re not selling them something just to sell it.

Your marketing messages need to be not only personalized, but frequent. In a tough economy, it’s common for consumers to question where every penny is going. When they do that, suddenly every relationship is a little at risk. Their question becomes “Am I really getting value from this relationship, or is there something that will satisfy my needs equally for less money?”

2. Don’t make cuts. Now is not the time to scale back on marketing spending. If you don’t stay in touch with your best customers — while they’re continuously exposed to messages from your competitors — the idea of buying your brand gets further from their mind. This is especially true when consumers are already reconsidering their brand loyalty.

In several categories, competitors aren’t marketing as much or they’re reducing campaign frequency. With these cutbacks, some marketing media have become cheaper. If you’re not afraid to spend some money on acquisition, chances are your media costs can be a little more efficient.

3. Show them you care. Empathize with customers to demonstrate you understand what they’re going through during the recession. Health care, for example, is a big concern for consumers right now.

You should always practice good marketing — personalization, appropriate messages, frequent touches — but focus on these things even more to keep your customers with you through the economic crisis. When times are better, you’ll have your core group of customers — and then some.

Scrubbing Data

Deliver Magazine reported that despite the ROI potential from data hygiene, many companies still haven’t cleaned up their lists.

Data management is still a hot topic for many companies these days. Marketers too often focus on how best to use the data rather than spending enough time wondering whether the data itself is clean. Good data hygiene can have a significant impact on your company’s ROI, minimizing waste and building trust with consumers by contacting them at the correct address.

Rod Ford, founder and chief executive officer of CognitiveDATA, a data-quality management company discusses a few of the misconceptions about data hygiene with Deliver.

Deliver: Why aren’t companies today putting enough resources into data quality?

Ford: Data hygiene is typically grossly under-budgeted. Many direct marketers spend less than 1 percent of their overall direct marketing budget on data quality.

Deliver: Why do companies say that they value data quality but not fund it properly?

Ford: Many organizations live under the misconception that their data is already highly accurate. This is because they are passing this data through vintage tools a few times a year and not finding incorrect addresses or other problems with the data.

Deliver: What should marketers be doing to improve data quality?

Ford: Several issues are forcing marketers to be more efficient in their mailings. The green movement and the push toward less waste in the mail stream is one. Then there’s the fact that response rates have declined because, during the recession, the consumer has less discretionary income than in the past. Finally, direct mailers are facing rising costs in almost every area of mail production. These issues already were forcing marketers to take a closer look at data hygiene before the recession hit. What the macroeconomic environment has done is accelerate the adoption of data-hygiene technology.

Deliver: Do you think that marketers will go back to ignoring data hygiene once the economy recovers?

Ford: Right now, direct mailers are learning important lessons about the impact of more accurate data. When you reduce the number of undeliverable pieces of mail in a campaign, this increases the overall response rate, for example. These lessons will transcend whatever is happening in the economy.

Another Reason for List Hygiene

Deliver Magazine told of a valid reason to regularly scrub mailing lists. Sure, mailings sent to the deceased get responses — but they’re usually from distressed family members commenting on how disrespectful and downright rude the company is for sending it in the first place.

“Not only is this a waste of a company’s time and money, it also can be extremely damaging to a brand, resulting in customers lost rather than gained,” says Kirk Schuh, vice president of marketing delivery services at ARGI, a database marketing company. “Regularly cleansing files must become part of a marketer’s regular list hygiene routine”, Schuh says. “Deceased suppression is a delicate issue,” he adds. “No matter how vigilant marketers are, their lists always can benefit from routine maintenance and enhancement.”

What does your brand stand for?

Deliver Magazine provided some thought provoking questions for many organizations and their marketing teams.

You spend hours crashing through strategy documents, pulling out nuggets of customer insights, determining differentiators in the industry and understanding what it is that makes your corporation unique. And in the end, you have a vision of who and what your company is about. It’s that vision that helps establish relationships with customers, win over prospects and get your company noticed in this increasingly chaotic and fragmented world.

Then, after all of that strategic work, comes the execution part of the marketing plan and you decide to go digital. You send an e-mail — which looks just like any other e-mail in your best customer’s inbox.

Oh, we know, you finely tune the colors to match your brand (despite the fact you can’t calibrate how that color appears on any one monitor) or you include photography and graphics (which don’t download until the users request them) or you include the all-important link to your heavily branded Web site (although fewer than 10 percent click through).

So, maybe it’s not the optimum branding experience, but it’s cheap. Boy, is it cheap. And it’s efficient — you can reach hundreds of thousands, even millions in a single blast — and really, you’re getting the word out there.

Then the economy picks up, but your sales don’t jump as much, and at the next marketing meeting, as you’re puzzling over the numbers, someone asks why your customers aren’t so loyal anymore. What’s happened to that great relationship your brand used to have with them? And there’s a lot of this and that around the table, mutterings about “empowered consumers” and “everything’s a commodity,” and the meeting rolls on. You shrug your shoulders and concentrate on the next campaign. There’s work to do.

We understand. It’s not an uncommon problem. It’s just that, well, you could stand for something. You could put something in your customers’ hands, something branded. Imagine that: those finely tuned colors, the carefully selected images, the perfectly worded summation of what your brand is all about sitting right there in the hands of the people you most want to reach. It’s right there at their fingertips.

And inside that package, something amazing — something they could never get digitally. A sample, a tchotchke for their desk, a magnet for the fridge, a baseball bat, a brick, a salami — who knows? Something that’s amazing and brilliant and relevant, just like your brand. A piece that says “Hey, I know you,” and reminds that customer why he or she came to you in the first place and what your brand is really all about.

You could do that. But that’s direct mail, and some say that is old. No point in doing that, right?

Thrive in Turbulence

Deliver Magazine (the marketing magazine published by the US Postal Service) interviewed Philip Kotler, Distinguished Professor of International Marketing at the Kellogg School of Management at Northwestern University, and here are some highlights. He was talking about his book, Chaotics: The Business of Managing and Marketing in The Age of Turbulence. I remember reading Kotler’s books in college, it is great that his new ideas are still so relevant.

Eight ways to flourish despite widespread uncertainty and upheaval

1. Secure your market share from core customer segments. Your first priority is to get your core customer segments firmly secured. This is no time to get too greedy. Be prepared to ward off attacks from competitors attempting to take away your most loyal and profitable customers.

2. Push aggressively for greater market share. All companies fight for market share and, in chaotic times, many have been weakened. Slashing marketing budgets and sales travel budgets are sure signs that a competitor is buckling under pressure. Add to your core customer segments at the expense of your weakened competitors.

3. Research customers now more than ever. Everyone is under pressure during times of turbulence and chaos, which means all customers are changing their habits — even those in your core segments whom you know so well. Stay close to them. You don’t want to find yourself relying on old marketing messages that no longer resonate.

4. Seek to increase — or at least maintain — your marketing budget. This is the worst time to think about cutting anything in your marketing budget that targets your core customer segments. In fact, you need to add to this budget, or take money away from those forays you were planning to go after totally new customer segments. It’s time to secure the home front.

5. Focus on all that’s safe. When turbulence is scaring everyone in the market, there is a massive flight to safety by most consumers. They need to feel the safety and security of your company and its products and services. Do everything possible to communicate that continuing to do business with you is safe. Spend whatever it takes to do it.

6. Quickly drop programs that aren’t working. If you’re not watching your spending, rest assured that someone else is — including your peers whose budgets couldn’t be protected from the ax. Cut out ineffective programs before someone else calls attention to them.

7. Don’t discount your best brands. When you do this, you instantly tell the market two things: Your prices were too high before, and your brands won’t be worth the price in the future once the discount is gone. Instead, consider creating a new, distinct product or service offering under a new brand with lower prices. This gives value-conscious customers the ability to stay close to you while not alienating those still willing to pay for your higher-priced brands. Once the turbulence subsides, you may consider discontinuing your newly introduced branded value product line — or not.

8. Save the strong; lose the weak. In a turbulent economy, you need to make your strongest brands and products even stronger. There’s no time or money to be wasted on marginal brands or overly fragile products that aren’t supported by strong value propositions and a solid customer base.