Monday, December 29, 2008

Can You Make Money With Social Media?

In the last 10 minutes, I have edited my Facebook profile, accepted a new invitation on LinkedIn, watched a video a friend emailed me, looked up "almanacs" in Wikipedia, and written in this blog. That's social media at its finest!

But, did any business benefit from that activity? Not directly. My company will build site traffic, recognition, and credibility with this industry-specific blog. Does it make us money? That is the question that I have been pondering...

Can you make money with social media? I'm talking about businesses and corporations. Everyone is raving about social media as the next biggest thing. But is anyone making money? There are entire conferences in NYC about "monetization" of social media. Lots of buzzwords, but I'm not seeing it.

I come from a direct response background. You spend X on a direct marketing campaign, you get Y response, equaling Z return on investment. How do you measure the response from social media? How can you tell if you're making money?

After some comparative research, I'd classify social media as anything that exists primarily as user-generated content. This includes social networks, such as Facebook, MySpace, YouTube, Twitter, and LinkedIn. It also includes blogs, forums, videos, and podcasts. Even wikis and knols would count. I read many articles proclaiming the virtues of social media and how it can benefit businesses. There were few examples of how it could actually make money for a business. The examples I found were consumer-related. For instance, a retailer of clothing for teenagers posted pages on MySpace and YouTube with games, contests, or links that drove traffic to their website.

What about marketing life insurance to middle-age adults? Or annuities to seniors? Can social media help you? What about business-to-business? How does my company, Allegro, market its services to other businesses with any measurable results?

I'm not sure. The social media movement is about relationships. Social media exists to foster conversations and connections between people. Participants in social media are looking to engage with others, to extend beyond one-way communication.

I think we can use social media to build relationships. I may need to change my direct response thinking to find new ways to measure the effectiveness of that relationship. While a prospect may not send in a reply card or "respond" in some way, he or she is still interacting with your company.

Here are some "relationship" benefits you may get from social media today:

Find feedback
It's easy to find out what customers are saying about you and your products. Set up your own microsite and ask for comments or opinions. Write a blog or launch a forum and invite feedback.

Conduct research
Use social media as a channel to learn more about your customer's interests, tastes, and preferences. Conduct surveys or polls. Find out where your customers are and see how they are using social media.

Reinforce your brand
Social media can help you build your brand image. Use a blog to discuss topics related to your business. Use videos to show the benefits or unique features of your products or services.

Find new customers
A group or page on a social media site can link readers to your website. If they found you through social media, they should be a targeted visitor and can hopefully be converted into a customer.

I have to be honest. I think social media has yet to be used to its fullest potential in the business marketing realm. We need to think of new, creative ways to make it work for us.

If you have examples of how social media has helped a business achieve measurable results, I'm eager to hear them. If you are skeptical about the business benefits of social media, let me know. Let's begin some two-way communications!

Wednesday, November 5, 2008

Should You Green Up Your Direct Marketing?

I've been reading about green direct marketing lately. There seem to be two distinct views about the idea of greening up direct mail. One side thinks that "green direct mail" is an oxymoron. The other side says that it's worth taking a look at your direct marketing efforts and finding ways you can improve your green marketing efforts.

I agree that it's worth seeing if you can green up your marketing efforts. It's good for the environment and the future of our planet. It may also be good for your bottom line. Let's be honest. Most companies will support an effort to "go green" is if it is profitable for them.

The most successful green efforts will involve doing things that your customers and prospects will see as beneficial. That may mean actually modifying your products or services to include a green aspect. Here are a few examples.

Office Depot offers an assortment of products with a "green" element, most having to do with using recycled materials. They found that customers liked the new products, but didn't like searching through all products to find the green options. So, Office Depot began publishing and mailing The Green Book. It's a catalog of environmentally friendly products.

It's ironic that Office Depot is using a catalog to market its green products. Yet, it works. They are reaching a niche market that is concerned about purchasing these Earth-friendly alternatives. And, I'm sure they are making a profit from these green products.

SC Johnson, the company that makes brands like Shout, Windex, and Scrubbing Bubbles, also markets Greenlist product labels, which designates products with a special label indicating they contain fewer volatile organic compounds (VOC). The Greenlist process lets the company measure the overall environmental impact of each product, as well as aids its ability to tweak formulas to scale back harmful ingredients.

Why is SC Johnson creating these green products? First, the company believes in doing what's best for the environment and has a long history of exceeding environmental guidelines. Second, they are meeting a demand for cleaning products that contain fewer harmful ingredients and are good for our planet.

Now, you may be thinking that your company isn't really in a business where you can offer green products or services. For instance, if you sell life insurance or long term care insurance, it might be difficult to green it up. So, here are some quick tips to help green your mailings:

Continuously update your mailing list.
Yes, this is something that is obvious to all marketers. But, I mean really get in there and be critical of your lists. Are you sending the right offers to the right prospects? Could you segment your lists to send more relevant messages to each audience rather than mass mailing everyone? By frequently reviewing and updating your mailing list, you can make sure you are only sending materials to your best and relevant prospects. That means less money spent mailing and less paper and resources consumed.

Use recycled materials.
Use more materials made from recycled paper. To help make sure your materials can be recycled by recipients, try using soy or water-based inks, windowless envelopes, and uncoated stock. Also, add a written message or the Recyclable symbol on your marketing materials to encourage recipients to recycle.

Be accurate in your claims.
Make sure you use the proper terminology and logos in your direct marketing materials. Educated consumers will know the difference. Remember that the word "Recycled" or the recycled logo may only be used alone when the product or package contains 100% recycled material. Use the recyclable symbol to identify paper and paperboard products made from fibers that, after use, are suitable for recycling. Ask suppliers to provide documented proof of their environmental claims. If they claim their products are made from recycled materials, ask specifically about the percentage of recycled content.

Consider on-demand direct marketing.
You may be able to reduce the amount of materials you print by sending out materials on-demand. Rather than printing up thousands of pieces to keep in inventory and then possibly throw out when they become outdated, just print what you need when you need it. You will also have more opportunities to customize the materials you mail. This means you may be able to mail less while maintaining or even increasing response rates.

Offer paperless options.
You can create an integrated marketing campaign and invite recipients to respond to your mailings online using a custom landing page. Or, allow customers and prospects to opt to receive their offers through email communications – for those who prefer not to get paper. You can also drive toward more online statements and notifications, if it fits your business. These paperless alternatives can save you money in materials and printing costs, and some of your customers will appreciate having more green options.

It's tricky to do classic direct marketing and be green. Always be honest with your customers and prospects about your green efforts. Think about your products and services to see if there's something you can do to fill a green need. You may find yourself in a great position - establishing good business practices and making a profit!

Friday, October 3, 2008

The Upside of a Down Market

There are companies who are actually doing well amid today's economic turmoil. Do you believe me? Well, it's true.

I know, today's economy is a mess. First, we had the subprime mortgage crisis, which burst the American housing bubble and led to serious loan defaults. Then, the high price of gasoline and increased food costs have encouraged Americans to tighten their collective belts. Now, we have the unstable financial sector with mergers, buyouts, and government bailouts.

But, there are companies who are thriving and growing. I have talked to to them. One company is in the business of converting structured settlements into cash. Ah, light bulb. You can see how this company could do a booming business right now. They can appeal to people who are feeling the crunch and want to access additional money. Makes sense.

Another company helps car dealerships create custom websites. They have found that dealers are cutting back on their traditional marketing efforts, but feel that a custom website is a cost-effective way to provide valuable and relevant information to customers and prospects.

What can we learn from these two companies? Well, several things:

1. Find your niche.
Both of these companies are focused on a highly specific product or service. They have found what they do well, and that's ALL they are doing. I am constantly surprised by the number of companies who try to do everything. I recently read an article about a search engine company that is dabbling in finding new sources of energy. Do those businesses go together?

2. Focus on the positive.
Both companies have found positive ways to help their customers. They could use scare tactics and focus on the negative aspects of the economy. But, they aren't. They have positioned their products and services positively as a good financial decision. People are smart, and they know when they are being treated with respect.

3. Be enthusiastic.
Both companies are very passionate and excited about what they do. And so are their employees. From talking to their sales staff, you can immediately tell that they love what they do, and they believe in their products and services.

4. Provide great service.
Now more than ever, customer service matters. These companies serve their customers and they are happy to do it. They keep their word and deliver what they promise.

5. Evaluate your products and services.
Are you offering something of value to today's customers? If not, it may be time to modify or improve your product offering. If you're a restaurant, you may find that more people are eating at home to save money. Maybe you could offer a special family night, or create a family take-out menu with discounted pricing to encourage customers to come to your restaurant. If you're a jewelry store, customers may be cutting back on luxury purchases. You may need to evaluate your inventory to see if you can offer more cost-effective products. Or, think about added services such as free cleanings and free prong checks to make sure the stones are secure. This can create more store traffic and help with sales.

Think about companies that you know are doing well. What can we learn from them? If you have more examples of companies who are thriving, let me know!

Tuesday, September 30, 2008

To blog or to knol: that is the question!

A colleague recently asked me to explain the difference between a blog and a knol. She wondered if it made more sense to use a knol for presenting expert information.

I thought that was a good question. So, here's my answer.

A Knol is a giant blogging site. However, it is more often compared to Wikipedia than a blog. That's because a knol is typically written in an authoritative manner about a single topic. For instance, a knol could be about "Insomnia" or "How to easily fit into Japanese society."

The main differences between a knol and Wikipedia include:

• Wikipedia has one page per topic, while a knol allows multiple authors to write on the same topic in different places.

• On Wikipedia, you are not to create pages for self-promotion. You may use a knol to promote your business or products and services.

• Anyone can edit most Wikipedia pages, while a knol is written by one author. Yet, you can allow different levels of collaboration by others, including wide open editing, moderated editing, and no editing.

Now, back to the original question: what's the difference between a knol and a blog? Well, first of all, here's how they are the same:

• The sign up process is similar to signing up for a blog.
• The interface looks a lot like a blog. You write your content. Add any graphics or titles.
• Knols allow comments just like blogs.
• You can elect to allow ads just like with a blog.
• You create an author profile, the same as a blog.

Now, how is a knol different than a blog?

• A blog can really be about any topic, whatever is top of mind for the writer that day. A knol is about a specific topic.

• A knol is more scholarly or professionally written when compared to many blogs. However, business blogs, like this one, can also have an expert tone.

• A blog is designed for continuous posting of ongoing content. While it's easy and helpful to update the content of a knol and keep it fresh, knols aren't meant for continuous posting.

• Readers can rate a knol, and these ratings will help the best content emerge at the top of search results.

So, here's my recommendation:
If you recently fixed a leaky faucet, and you want to give expert advice on the steps you took, write a knol. If you want to wax on about your life or a particular business topic with ongoing postings (such as direct marketing), then go with a blog.

Monday, September 1, 2008

Are You Ready to Go On-Demand?

As postal rates, paper prices, and printing costs continue to increase, it may be time to rethink how you communicate with customers and prospects. It’s time to do direct marketing that’s on your terms.

Direct marketing on-demand can help you send more customized, relevant marketing materials to your audience. You may be able to mail less, while increasing your response rates.

How can you decide if direct marketing on-demand is right for you?

Let’s take a look at the two ways that direct marketing on-demand can benefit a company.

1. Give marketing managers more flexibility.
You may have a marketing staff that manages the creation and production of your direct marketing materials. They need to be able to adapt and customize marketing efforts quickly and cost-effectively. For instance, a mortgage company might need to adjust interest rates within a direct mail package. It is more effective to do highly customized messages that speak directly to the needs of customers or prospects.

2. Support your sales staff.
You can provide your sales representatives or agents with direct marketing materials that they can use to build leads and close sales. An on-demand system allows your sales staff send out customized, personal mailings. For instance, a sales representative for a financing company finds out that one of his customers is looking to buy a large piece of equipment. The salesperson can send a letter, personalized with the rep’s information, that addresses the new purchase and the financing options available from his company.

If your company fits one of these scenarios, then direct marketing on-demand can help you create highly customized, relevant marketing programs that increase response rates and build customer relationships.

Here are some of the advantages of direct marketing on-demand.

Shorter lead times to get in the mail. While traditional direct mail can take a month or more to prepare and drop in the mail, an on-demand direct mail package can be sent out in a matter of days.

More control over brand identity. Your direct mail letters, envelopes, brochures, sell sheets, inserts, and other materials are set up as templates that comply with your company’s brand identity. Only personalized or custom information varies, so you can be sure that mailings and collateral adhere to your branding guidelines and standards.

More flexibility in messaging. Is a mailing not performing as well as expected? With an on-demand system, you can modify offers, messages, and other text to help improve response rates.

Keep materials current. Have you printed a brochure or sell sheet, only to have it become outdated within a few months? With on-demand, you print only the amount you need.

Reduce your inventory. When you do a large print run, you may have materials to store. Or, you may need to store large quantities of envelopes, letterhead, or brochures. With direct marketing on-demand, you print only what you are going to use immediately — drastically reducing your inventory.

Create specific, segmented mailings. You can create hundreds of on-demand direct marketing pieces to suit your company’s needs. You can have introductory mailings, event-triggered mailings (such as a follow-up on a recent purchase), and product-specific mailings. It really depends on how you want to communicate with customers and prospects.

Cost-effectively send small quantities. You or your staff can send one mailing or thousands of mailings at a time. A salesperson can send a single follow-up direct mail package based on a phone conversation with a prospect. Or, marketing managers can send a mailing announcing the launch of a new product and a special offer to hundreds of current customers.

Automation reduces errors. With an on-demand system, the print production and fulfillment processes are completely automated and virtually free of human error.

Help salespeople build relationships. Ongoing direct marketing efforts can help your sales staff build a rapport with clients and prospects. They can send materials that are relevant and timely based on customer interaction, or just stay top-of-mind with prospects at different stages in the buying cycle.

Fulfill complex collateral or sales materials. What if you need to fulfill requests for information for different prospects all across the country? For instance in the insurance industry, product features may vary based on state requirements. You may need to create hundreds of versions. With an on-demand system, you can manage many fulfillment variables and send materials out quickly and efficiently.

If you want to mail more effectively, increase your response rates, and improve your ROI, it may be time to consider a direct marketing on-demand system.

Tuesday, August 19, 2008

What are "Best Practices" for Email Marketing?

You may send and receive 100 emails at work every day. You may forward jokes to friends. You might even keep in touch with your grandma or favorite aunt. Email is an important part of our lives.

And, in just 13 short years, email has evolved into a powerful direct marketing tool. According to eMarketer, 147 million people across the country use email almost every day.

Are you and your company doing a good job of reaching customers and prospects through email? We’ve assembled a list of 10 of the most useful and important “best practices” you can use to effectively send emails on behalf of your company.

1. Get permission.
Using permission-based marketing or opt-in email practices is mandatory. If you use a pre-checked box or other “passive” opt-in mechanism in your email sign-up process, it’s recommended that you change to unchecked boxes or another affirmative consent approach. In addition, review your unsubscribe process and make sure you are requiring as little information and as few clicks as possible to complete the process.

2. Set objectives for emails.
A mistake many email marketers make is to add too many things into a single email. Your emails should have focus and an objective. Are you wanting to cross-sell customers a new product? Do you have a special sale or price promotion for existing customers? You have a very short time to capture the reader’s attention and convince him to take action. Make sure it’s clear what you want him to do.

3. Ask for action.
Before writing begins on an email, decide on a call to action. What do you want the reader to do as a result of reading the email? Place on order on your Web site for a particular product or service? Call to talk to a representative about the offer? Get the offer in the email early on, possibly even as part of the subject line. And repeat it several times in the body of the email with links so that readers can take action.

4. Put the customer first.
You can use email marketing to prospect for new customers, cross-sell existing customers, build loyalty, confirm orders, offer support, announce new products or services, drive people to your Web site, or get valuable feedback. Whatever your goal, the email must be about the customer. Readers want to know immediately what is in it for them. So get to the point — and make sure you have one!

5. Give users control.
It’s important to build trust with customers and prospects during the email marketing process. While most consumers are savvy when it comes to using email, they still worry about spam, scams, and privacy violations. Put readers in control by using an opt-in process and build trust from the beginning.

6. Make the subject line count.
The subject line is one of the most important components of creating a successful email. Working in tandem with the “from” line, the content of the subject line helps determine if a recipient will open the email, delete it, file it, or mark it as junk.

Here are some tips for writing compelling subject lines:
• Keep it brief — six words or less is an ideal length.
• Intrigue readers.
• Be honest.
• Invoke action — tell readers what to do.
• Use personalization — include the recipient’s name.
• Use your company or brand name in the “from” line to clearly let recipients know who sent the email.

7. Write a powerful message.
From the moment someone opens your email, you have 3 or 4 seconds to sell. Here are some general tips for writing good email messages.

Be open and honest. Tell who you are and why you’re writing.
Get personal. Write like you would a personal letter.
Think “above the fold.” Make sure the important information shows.
Keep the paragraphs short. It makes the email content easier to read.
Make it quick. Keep the message simple and concise.
Ask for action. Give plenty of links so readers know what to do.

8. Create good design.
As with all direct marketing programs, the copy and graphics should work together as one unit. Each should reinforce and strengthen the other. If you’re using an HTML format, your graphics should be there for a reason.

9. Make it personal.
Personalization can add to the relevance of your message and build upon an existing relationship. It uses recipients’ own information to create a highly relevant message, which boosts the value of your email. You can incorporate the reader’s name, recent purchase history, other information about their interests and relationship with you.

10. Use many, many links.
According to a recent analysis by EmailLabs, increasing the number of hyperlinks in a message leads to increased open and click-through rates. The more links there are, the greater the chances that one or more will resonate with the recipient and motivate them to click through. If your goal is to funnel readers to your Web site or a special landing page, give them many access points. Put several link buttons sprinkled throughout the email message instead of just one.

Email marketing is an excellent way to build a personal, one-on-one relationship with customers and introduce prospects to your company. The question is: are you putting all of these best practices together to create a cohesive, effective email program?

Friday, July 11, 2008

Is It Okay to Break the Rules?

Rules are made to be broken. At least, that’s the way the old saying goes. Many so-called “rules” are simply guidelines for what most people think is acceptable.

For instance, you should change your car’s oil every 3,000 miles. Always put your napkin in your lap at dinner. Only wear white shoes in the summer.

If you break these rules, what’s the worst that could happen? Your car’s performance might decrease. You stain your good pants. You look goofy wearing white shoes in January.

But what if there’s an upside to breaking the rules?

You discover that your car performs just as well when you change your oil every 5,000 miles, and you save money on oil changes. Or, you find that wearing your napkin tucked in at your neck keeps you from staining your shirt. And, you start a hot new fashion trend by wearing white shoes in winter.

What about in direct marketing? Do we have to follow the rules?

Test your knowledge of some basic direct marketing rules. Take this true or false quiz and see how you do. Remember that these “rules” are based on what many experienced direct marketers believe. You may still be able to break them and have amazing success. We recommend testing to see what works for you. The answers are at the bottom of the page. Good luck!

1. T or F — A weak offer to a well-targeted list will produce a better response rate than an excellent offer to a poorly-targeted list.

2. T or F — As a rule, the sole purpose of envelope teaser copy is to present the offer.

3. T or F — A mailing with a letter but without a brochure will almost always outpull a mailing with no letter.

4. T or F — After opening the envelope, the prospect will look at the letter first.

5. T or F — Repeated tests have shown that the cost of providing a business reply envelope is justified by increased response.

6. T or F — About five times as many people will read a headline as read the body copy.

7. T or F — As a rule, a premium will sharply increase response. However, as the response rate goes up, the quality of responses goes down.

8. T or F — As a rule, a blue ink signature in a sales letter will produce an equal response as one printed in the same black ink as the letter.

9. T or F — As a rule, mail delivered to consumers on Saturdays and Mondays will have the poorest response rate.

10. T or F — As a rule, the most effective postage on a direct mail promotion is a single stamp.

There's a time to follow the rules and a time to break them. If you're going to break them, at least follow these two rules:

1. Test everything.
2. Test only one thing at a time.

Should the letter come from someone in marketing, customer service, or the president of the company? Test it. What is the best P.S. for your letter? Test it. Should you include a phone number to reply or just a reply device? Test it. Should your brochure be two-color or four-color? Test it.

But, be sure to try one thing at a time. Say you change your envelope, letter copy, and try out a new list. Response rates improve dramatically. How will you know which one increased response?

It's important to know the basic direct marketing rules. Then, you can go out and break them!

1. True. If you’re mailing to the wrong people, the best offer in the world will receive a poor response.
2. False. The number one goal of the teaser is to get the recipient to open the envelope. Anything beyond that may be counter-productive.
3. True. The personal aspect of the letter makes it one of the primary elements in a successful direct mail package.
4. False. You have no way of knowing which piece the prospect will look at first. Some will go to the letter first, others to the brochure, and still others to the reply device. Each piece must be designed to capture the reader.
5. True. The easier it is to reply, the more likely a prospect will respond.
6. True. Most people are skimmers and will look at the headline first.
7. True. While more people will respond, many respond simply to get the premium. It is best to look at conversion or follow-through rates when using a premium.
8. False. Blue ink will typically pull better than black ink.
9. True. Many believe that Tuesday is the best day for prospects to receive mail.
10. False. Many marketers have found that multiple stamps pull better than a single stamp.

Monday, June 23, 2008

What Motivates People to Act?

Why are you reading this blog right now?

You may have conducted a Google search that brought you here. Or, you may have clicked through from the Allegro website. Or, maybe you simply stumbled onto it.

Why are you still reading? Simple curiosity? Are you looking for specific information? Are you just bored?

Each of these reasons can motivate someone to act. Are there other motivators? You bet. How can you use different motivators to prompt a prospect or customer to take the action you want?

The Old Motivators.
You have probably heard the famous quote by Henry Ford when talking about the Model T, “You can paint it any color, so long as it's black.” Although it has never been proven that Mr. Ford actually said that, it does capture the business approach of the early 1900s. Companies produced mass numbers of exactly the same car, tool, or bag of flour, and people bought them. Little thought was given to why consumers picked that particular product. Often it was the only choice available.

It wasn’t long, though, before commodity items began to compete with each other for the buyers’ attention and money. For instance, flour companies began to gain brand recognition and repeat purchases by creating bags with bright colors and flower prints. Women would then recycle the bags to make clothes and quilts. The flour had appeal because its bag could satisfy multiple needs.

Soon companies discovered that sales and discounts were a great motivator for getting people to buy. In the 1920s, one author wrote that love, gain, duty, self-indulgence, and self-preservation were the five motives to buy. With the emergence of radio and TV, marketers began using sex and status to promote products. Marketing efforts were focused on building brand recognition through repetition and catchy jingles.

The New Motivators.
In the late 20th century, consumers’ motives became more sophisticated and complex. As people had more discretionary income and a plethora of products and services to choose from, it became more challenging to reach them with a compelling message.

As with most direct marketing topics, the experts today don’t agree on what motivates consumers to act. Hershell Gordon Lewis, in his book Direct Mail Copy that Sells!, states that the four great motivators are fear, guilt greed, and exclusivity. Bob Stone says his book Successful Direct Marketing Methods, “People respond to any given proposition for one of two reasons: to gain something they do not have or to avoid losing something they now possess.”

From the old to the new, all of these motives have one thing in common: they appeal to emotion. Most of the time, the reasons for acting on a direct marketing offer are guided by emotion and may even be irrational.

I recently bought a bright orange purse. Did I need another purse? No, I already had a purse that worked just fine. But, I wanted the orange purse because it matched my bright orange car. (That's another story about emotional purchases.) My husband just bought a gigantic crowbar. It's as tall as me. Does he need a crowbar that big? Could he live without it? Yes, but what if he should encounter a situation where he "needs" a crowbar that big? Now he's got one.

What motivates someone to buy an orange purse or a humongous crowbar? It's an emotional decision. I wanted the purse because it makes feel good to carry it. My husband wanted the crowbar because it was too cool to pass up.

Now may be the time to test new appeals and motivations. What is old may be new again. Or, it could be time for a unique, innovative approach or format that you haven’t tried before.

Just remember, people are emotional and irrational. Appeal to human nature!

Tuesday, May 6, 2008

When Is It Time For "Fresh" Creative?

Should you change a direct mail format if you can save on printing or postage costs? Can your design become tired? Is it appropriate to change your copy or appeal based on world events?

It can be difficult to let good creative go. On the other hand, it can be costly to change your package creative simply for the sake of change.

What the heck is “creative?” As direct marketers, we throw the word around all the time, but what does it mean? According to Webster’s Desk Dictionary of the English Language, creative
means “resulting from originality of thought or expression.”

Creativity, as it applies to marketing, is hard to define. It is elusive, yet obvious when you see it. A creative idea takes something familiar and presents it in a new and compelling way.

The goal of direct mail creative is to compel your customers and prospects to act. The bottom line is that good direct marketing creative should get results.

There are times when fresh creative is needed. The most obvious reason for a change is when response rates start to slip. However, it’s important to know why response is declining so that you can make the appropriate changes to the creative.

Here are a few factors related to your creative that may lower response.

When creative becomes dated.
Some direct mail packages seem timeless. An excellent example is The Wall Street Journal direct mail package with the well-known letter that begins, “On a beautiful late spring afternoon, twenty-five years ago, two young men graduated from the same college.” Similarly, many not-for-profit organizations have packages that have worked, unchanged, for several years. Yet, in most cases, creative can become dated over time. Graphic elements and design that was innovative and cool when first developed can begin to look old and uninteresting. Copy that had just the right tone and tempo can become flat and lose its appeal.

When your list becomes tired.
After multiple mailings to the same list, you may experience list fatigue and response rates will decline. It may be time to modify the creative to give prospects a fresh look, offer, or message. In addition, other mailers — including the competition — may be mailing to the same audience, which can detract from your response. Once again, a new creative approach can regain your prospects’ interest.

When the audience’s motives change.
Although the saying goes that people don’t change, their motives can. For instance, if your audience is maturing, they may change from being motivated by messages about entertainment and fun to messages that relate to family and security. When a product is new, the audience may be motivated by novelty, but as they become more savvy, the motive may change to value or quality. It’s important to keep motive top-of-mind in the creative process and change your creative appeal to fit the current motives of your customers and prospects.

When outside influences change.
Many external factors can impact a program’s results. For instance, in recent times, the economy has been wreaking havoc on once-solid response rates. In addition, national or global events can change the way customers and prospects respond to mailings. Even what the competition is doing can change people’s perceptions of your industry, product, or service.

When the product or service changes.
Since the product or service you are promoting is the driving force behind your mailing, any modifications can dramatically affect your creative. For instance, if you improve your product or service, add a new feature, or have something new to promote, your creative should reflect that. If a software company introduces a newer, upgraded version, the creative would be freshened up to reflect the new features and benefits.

When your offer changes.
The offer is a key aspect of the strategy behind a direct mail program. If your offer is given a fresh approach, the creative will need to reflect that as well. For instance, if you start offering a free trial, discounted price, limited time offer, amazing premium, additional benefits, or special donor recognition, the creative should promote it.

When your audience changes.
When you target a different audience or even segments within your overall target market, you may need to fine-tune your creative to better reach them. For instance, you may find that your mortgage customers vary in age, marital status, income level, and hobbies and interests. You can create mailings that talk specifically to their needs. Young couples without children may be interested in travel and leisure activities. Couples with college age children may be looking for ways to help pay for their children's education. You can develop fresh creative that appeals to each audience.

When you can save money.
Another reason to rethink the creative approach for a program is when you can gain cost-efficiencies through different printing methods or lower postage. For example, you may find that slightly modifying the dimensions of your package will allow you to save on envelope costs, print more efficiently, or meet postage guidelines that qualify you for a lower rate. You may even find that you can entirely leave out a piece of a package and still maintain the same response!

As you can see, there can be many reasons for freshening up your creative. No matter what the reason, there’s one thing you should always do: test.

Is it time to give your package a fresh, updated look? Test it. When the economy is tight, should you change your copy to be less lighthearted and more serious? Test it. Should you try a two-color brochure instead of a four-color one to save money? Test it.

You get the idea...

Friday, April 25, 2008

Are You Cutting Through the Clutter?

As consumers, we are in sensory overload. From the time we wake up until we go to bed, we are bombarded with marketing messages. You hear ads on the radio or TV as you get ready for work. You read the promotion on the back of your cereal box. You see more ads as you flip through the morning paper. Then it’s billboards and signage on public transportation. Next come e-mails, banners, magazines, telemarketing calls, more TV…

Consumers are overwhelmed. We have too many options, too many choices to make, and too much information. Grocery stores in the 1970s stocked about 7,000 items. Now we have 30,000 items to choose from. In the 70s, we were exposed to 300 to 500 ads a day. Now it’s somewhere between 3,000 to 5,000 a day.

Confusion and complexity are your enemy. Too many benefits are confusing. Complex explanations are, well, complicated. Simplicity works. Keep in mind that some of the best campaigns have simple messages. A Timex is reliable. Campbell’s Soup is good. Crest fights cavities. Read The Wall Street Journal, and you will be successful.

Simplicity works at every stage. Simple strategy. The best strategies are based on a single concept that can be summarized in a few words. Simple creative. Copy that is short, sweet, and easy to read. Clean graphics that support the message. A simple, compelling offer. Make it easy to respond. And, most importantly, make sure you follow through on what you promise.

Whether you’re talking to consumers or businesses, the first challenge is to get noticed. Here are some ideas to help you cut through the clutter:

Try a new format.
Industries often get stuck in a rut thinking that they are supposed to use a certain format. If you typically send home equity offers in a #10 envelope, try a different envelope size. If you are targeting businesses, experiment with dimensionals. They stand out in the mail and often get past the gatekeeper.

Stay relevant.
Attitudes change quickly. What used to motivate customers and prospects last year — or even last month — may not work now. Your message needs to ring true with your audience. Businesses that were motivated by containing costs may be more interested in results. Consumers may be interested in saving time. By saying something that speaks to their needs or concerns at the moment, you can cut through the clutter.

Be personal.
Part of making your message relevant is making it personal. To be more personal, you may need to segment your audience by message, offer, or location. For instance, you may find that business prospects in different industries have different needs. A software company may use your product or service differently than a financial services firm. You may have customers that are sensitive to price and want to know when they can get a bargain and others who want what is trendy or want high quality. Knowing how to talk to your customers and prospects on a personal level can help them pick you out of the crowd.

Make sure you listen.
Listen to your best customers. You can cut through the clutter by finding out what they want. Learn how they want you to communicate with them. You may find that business customers would like a separate section on your Web site that supports their needs and helps answer questions. Customers may like to receive e-mails with special offers.

Make customers feel special.
Send customers a special thank you for purchasing from you with an incentive to buy again. If customers feel a special connection with your organization, they will look for your communications.

Have a great offer.
The offer is still the most important part of a good direct marketing effort. It needs to appeal to your audience. If you’re reaching businesses, it may be a free trial, guarantee, or reward for listening to your sales pitch. If you want to intrigue consumers, you need to stand out from the competition. Try something new. The right appeal will grab their attention.

Get specific.
If you generalize, you may lose them. People want to know what they’re getting, what it will do for them, how much it will cost, and when they can get it. Be as specific as possible with your message and offer. Quote facts and figures of past success to business customers. Use testimonials or demonstrations to show consumers what they’ll get. The faster customers and prospects can understand your message and offer, the closer you are to capturing their interest and making the sale.

Keep it simple.
We need to say it again. Today’s consumers are busy. They need to understand what you can do for them right away. If they can recognize your company or organization and make a quick connection, that’s even better. Business customers will learn to recognize you as reliable, fast, or affordable. Customers will like the quality of your products, your great customer service, or how well you know them.

Even through the clutter, consumers continue to respond to marketing offers. They respond to the ones that move them. They respond to simple messages and great offers from organizations they trust. Make sure that every communication you have with your customers and prospects counts.

Wednesday, March 12, 2008

What To Do When Budgets Get Tight

It’s hard to turn on the TV without hearing the dreaded “R” word. You guessed it: Recession. Some economists would argue it’s just a blip on the overall economic radar while others are preaching impending doom. I tend to agree with the former outlook. In fact, it seems that America has talked itself into a recession.

The first step to dealing with a possible recession is: Don’t panic. This is not a time for radical changes in your marketing plans. We have found that the best approach is to continue doing what you’re doing.

A dangerous response to a slowing economy is to wait it out for a few months and see what happens. At Allegro, we have been talking with several companies who are putting their marketing plans on hold for a quarter or two to see how things will pan out. By delaying, these companies will end up playing a game of catch-up later on.

We recommend making minor tweaks to your current programs to take into account the changing economy. This is not a time for conducting extensive tests. If the economic downturn is temporary, which most believe it is, then by the time you have your test results and are ready to act on them, they won’t be relevant any more. That’s not to say you shouldn’t test. Once again, we would say to continue doing what you’re doing. Test as you were, but be sure factor in the slow economy as you analyze the results.

Here is a list of some things to keep in mind as you review your company’s direct marketing programs:

Look at your target audience.
You may want to really think about who you are targeting. Are you reaching the best customers or prospects for a particular product or service? Is it the right audience? You may find that your product or service is better suited for a different target market during harder times. For instance, it might be worth investigating a higher income bracket than you typically target.

Review your offer.
Does your offer still make sense? You may need to offer a different price incentive or offer a group of products or services. Many financial companies are offering customers free services if they have multiple accounts with the institution.

Think about the tone and message.
What motivates a prospect when times are good may be different than what hits home when money is tighter. Or, you may feel that your message is still right on. Unlike consumers of the
past, we are used to a certain lifestyle, and it takes a drastic shake-up for us to change our spending habits. For instance, Wal-Mart's “Save money. Live better.” theme works even better in a slow economy.

Check out the competition.
If your competition has cut back on its mailing schedule or print advertising, that’s all the more reason you should be mailing or advertising. Your customers and prospects will still be buying, and if you’re the name they see, it’s more likely that they’ll buy from you.

Look for cost-efficiencies.
While we don’t advise you to scrimp or stop your marketing efforts, we would encourage you to take a look at areas in which you can gain cost-efficiencies. For instance, it may be time to look for ways to cut production costs. Or, you may consider using direct marketing agencies that are results-oriented and can efficiently manage programs for you.

The main benefits of direct marketing are its highly targeted nature and ability to get proven results. When budgets are tight, direct marketing is often the discipline that comes through in slow times. With direct marketing, you can target those customers and prospects who are most likely to respond. In addition, you can immediately see the results of your marketing dollars and can make adjustments accordingly.

Tuesday, February 12, 2008

What Should You Test?

Should you test a live stamp versus an indicia? When do you test entirely new creative? Can the copy on your order form dramatically affect results?

As with many questions in direct marketing, the answer is, “It depends.” You may have heard someone say, “Direct marketing testing is a science.” And while testing requires a scientific approach, it is also an art. It takes experience, some finesse, and common sense.

If you find yourself thinking, “There’s no need to test that because it ALWAYS…” then you may be proven wrong. In direct marketing, things are constantly changing. What worked last year, last month, or even last week, may not work now. That’s why testing is so important.

Whether you’re marketing to individual consumers, businesses, or donors, you are still dealing with people. And people are fickle. Attitudes, motivations, wishes, dreams, and goals can change overnight.

Many direct marketers have found that the direct mail packages that performed well a few years ago are not working as well today. That’s why it’s important to continually test your package elements to make sure they are in tune with the needs of customers and prospects.

However, you can get “test happy.” You should be careful to test only those things that have a reasonable chance at beating your control.

Here are two key factors to consider when thinking about a test:

1) How much money will the test result save you?
2) What can you do with the results?

For example, if you are sending out a package and want to test mailing it first class versus standard mail, you need to determine if the anticipated lift in response will be enough to overcome the additional postage costs.

The point of testing is to improve your return on investment. The ROI equation can be satisfied in three ways:

1) increasing response while keeping costs steady,
2) keeping response steady while lowering costs, or
3) spending more to improve response significantly.

Big tests have the biggest opportunity. If you can work on the strategy, message, creative, and offer, test those first. In acquisition, always test multiple lists and list segments. Formats can also have a big impact on results. A 9 x 12 package versus a 6 x 9 may make a dramatic difference in response.

Sometimes less can be more. Through aggressive list testing and segmenting, you may be able to mail less with greater response. You may be able to eliminate a package insert while maintaining the same response rate. At Allegro, we once tested eliminating a premium from a package and actually increased response from certain list segments. The only way to know if you can get by with less is to test it.

There are also times that call for significant package changes. Even highly successful controls will eventually wear out. The marketplace or attitudes can change and response rates may begin to lag. Also, when testing acquisition mailings, it can be highly profitable to try an entirely new creative approach or package format. In some instances, a new package can become an instant breakthrough success.

Here are some of the significant areas to test:

• product or service features
• mailing lists
• envelope appearance
• number/type of enclosures
• strategic approach/appeal
• price or donation amount
• offer statement
• copy tone and message
• premiums
• overall package format
• timing of mailing

Always test any changes against what is currently working. If you’re going to test entirely new creative, put it head-to-head against what has been working for you. If you’re testing lists, always test one or more proven lists at the same time so you can have comparative results. If you’re testing copy, price, or offer, it’s also better to test more than one option over several lists rather than to test one package on one list. The more you are able to compare results among different approaches and lists, the more confident you can be that your test results are reliable.

Testing is part art and part science. It takes creativity, discipline, and the willingness to take some risk. And, you may just be rewarded with a higher return on your investment.