Increasing Return on Marketing Dollars

A Newsletter Published by
Lee Marc Stein, Ltd.
April 2007 Issue

CONTENTS

• Five Sins of Strategy Erosion and How to Avoid Them
• Playing with a Full Deck (Part III)

Five Sins of Strategy Erosion and How to Avoid Them

Allen Ginsberg may have seen “the best minds of my generation destroyed by madness.”  I have the Beat poet beat: I’ve seen the best direct marketing plans, concepts, and creative strategies destroyed by sins of omission or commission in execution. 

That’s strategy erosion.  It’s a madness of its own, but it definitely can be prevented.  Prevention starts with knowing the litany of sins.

1. Failing to focus on the objective. 

In lead generation, someone says “Let’s just put in a few paragraphs more about the product.”  That’s erosion, because the strategy in lead generation is to sell the prospect on taking the next step, not on the product.  In sweeps promotions, it is, again, saying too much about the product.  Look at an American Express Publishing sweeps package: there is virtually nothing about the magazine or service. 

Then there are the folks who don’t understand that the objective is to build a business.  They will do anything – wild and woolly offers, over-the-top creative, deception – to get a response, and that doesn’t necessarily mean they are “building customers.”  Spending too much money getting into the mail falls into this category, as does not spending enough to meet the response and ultimate sales objectives.

2. Dropping the ball on what drives response.

I’m constantly amazed at how few big name companies do little list modeling, research and even list testing, and how few have thought about media like inserts, drtv, and print.  Having the right list in direct mail is infinitely more important than having a great creative package.

In fact, great creative comes in third in the factors that drive response.  Having a strong offer is becoming more important than ever.  I say that because online media are so offer-oriented.  Make sure your offer doesn’t turn people off.  Recently, I developed a lead gen package for a condo developer in Costa Rica.  I know the list selection was right and the creative was on the mark.  It failed because the client insisted on asking for a $2,000 binder in the package in addition to having people pay for their flight from the U.S. to San Jose.

3. Using the wrong words, too many words, or too few words.

When I broke in as a copywriter some #@ years ago, I wondered why I had to be concerned with every word I wrote.  After all, in direct mail there are so many of them compared to, say, the famous Doyle Danebach “Think Small” ad for Volkswagen.  I had lesson-after-lesson in the importance of “le mot juste” (as Flaubert called it).  Perhaps the best involved the famous “Damn!” package that Bill Jayme wrote for BusinessWeek.  The idea was that “you go into a meeting, thinking you have the latest intelligence and ‘DAMN!’, someone outflanks you.”  Harold McGraw stopped the mailing of this winning package because that one word was in 72 pt. type on the envelope and was repeated a dozen times inside.  I substituted “I could kick myself”, mailed the package, and it flopped.  Jayme laughed at that and substituted “%#@&!” and the package still flopped.

Currently, I’m working with a client mailing to CEOs of relatively small companies.  He insists that the copy talk about the “Impotent CEO”.  CEOs have enough other problems.  The word “Powerless” would be just as powerful.

I encounter far too many companies who don’t understand the impact of the Internet on copy length and structure.  Voluminous copy doesn’t work in most applications; exceptions are those selling products which themselves require extensive reading – newsletters, for example.

On the other end are clients with little direct marketing experience.  They will say that lead generation messages (generally they’re against letters) should only be a paragraph or two.  They don’t realize that recipients sense the paucity of key things to say.

4. Losing the differential advantage.

Every product or service needs to have a differential advantage (or USP) if it is to survive in this commoditized world.  That differential advantage sometimes gets lost because we get so wrapped up in the tactics of involvement and immediacy and in pushing our targets to respond.  Of course if your product/service does not possess an inherent differential advantage, then the strategy must be to make your offer the differential advantage.

5. Blowing production.

There seems to be no end to what can go wrong in getting mail packages into the postal stream.  Most copywriters don’t care; I do because I’ve seen some of my best thinking and copy destroyed by production glitches.  What should you worry about most?  Incorrect 800#s, BREs that don’t fit, typos, bad matches in personalization, stock that has too much show through, miscoding, deficient tracking, bad merge/purges, the wrong inserts, non-USPS compliant envelope sizes, and of course smudged, smeared printing.

How do you avoid these sins of omission and commission?  How do you prevent strategy erosion?  By having a real creative brief okayed by the client and read more than once.  By having checklists that must be initialed by those working on the mailing.  By making sure that everyone realizes that the best ideas poorly executed lead to job loss.

I’ve been reminded that I should end my articles and columns with a note of comfort.  Here it is: As bad as strategy erosion in direct marketing is, there is something worse – having no strategy!

Playing with a Full Deck (Part III)
52 Testable Factors That Impact Your Direct Marketing Results

This is the third in our four-part series on factors that influence the success of direct marketing programs.  Is there an ace in the hole here which could turn your direct marketing program around?  No matter how small your program, you’ll find at least two or three factors that are “must tests.”

(Click here to read Part I and/or Part II)

Frequency

27. How many renewal notices should you send out to keep magazine subscribers or club members active?  What about upgrading users to the latest software release?  In all these cases, you keep mailing renewal/upgrade efforts as long as it’s economically feasible – that is until it’s less expensive to acquire a new subscriber/user than retain your current one.  The difference with upgrades is that they are not continuously delivered during the year like the issues of a magazine.  Thus, if an upgrade release is ready in September, but the user doesn’t order until the following January, it doesn’t make too much sense to begin the upgrade promotion cycle a few months later in June.  Test greater frequency during a shorter period of time.

28. Economics aside, what is the “point of annoyance”?  When does frequency backfire on the long-term value of the customer base? This requires long-term testing – over a few years at least.  Experience says that your really good subscribers or customers are not really going to notice how many renewal efforts they receive; the laggards or non-renewers will notice more.

29. What about emails?  How often can you email prospects to get them to sign up for a conference, for example, or to upgrade their software?  One company selling investment books and videos was emailing its house file daily and getting it to work.  Obviously, relatively few companies can get away with that.  On the other hand, if you’re promoting a conference, three email efforts are totally insufficient.  The week before the conference, particularly if your prospects are local, the frequency should be daily.  Because emails are so easily missed by even good customers, if you send an email a week to get particular groups to upgrade their software, that’s not too often.

Direct Mail Formats

30. The May 2007 postal increase changes pricing from weight-based to shape-based.  That means enormous penalties for mailing flats (9x12” envelopes).  What should you test to dominate the mailbox?  Depending on your product and your goals, do at least one more test of the flat.  With so many mailers dropping out of this size, your response may increase enough to overcome the additional costs.  You can also continue to produce what is essentially a flat, but fold it in half.  Test #14s – I’ve been an advocate for that size for decades.

31. With this postal increase, some mailers are thinking about stripping their mailing packages way down and even going to postcards.  What are the most sensible tests here?  Postcards don’t generate response on their own unless you’re a retailer trying to increase store traffic, or you have a dynamite online offer and you’re using the mail to get prospects to log on.  Don’t both with self-mailers either.  You should test leaving out the brochure or down-sizing it.  Better yet, go with your current package and jettison the bottom deciles of your mailing universe.

32. Can personalizing your packages bring quantum increases in response?  In pre-approved mortgage loan mailings, in some B2B applications, of course.  In those cases, if you are mailing in fairly large quantities, you’ll want to consider in-line formats.  That gives you the ability to use a closed-face envelope and to personalize at least the letter and response form.  You can do the same thing with digital printing for small quantities, but it’s much more expensive.

Using Print Media

33. It appears that all marketers are turning to Search Engine Marketing as the solution to their acquisition problems.  Is there any reason to think about direct response print?  With few exceptions – notably collectibles and nutritional supplements – traditional direct response print, selling off the page, has all but disappeared.  But print used for lead generation is alive and in fact thriving.  You see, print comes in at an earlier stage than SEM – it stimulates desire for the product or at least the category.

Take a look at inflight magazines.  They’re as fat with direct response ads as ever.  Full page ads to sell business products are repeated in issue after issue.  Then there are the small space (1/3 page or less) lead gen ads that mostly push readers to a web site.

34. What if you do find a publication that works for you?  If you’re using fractional space for lead gen purposes, be careful in pyramiding.  Going to a full page could seriously erode your advantageous cost per lead.  If the publication runs a lot of advertising pages, you could try a second fractional page ad (different headline of course) within the same issue.

On the other hand, if you’re already making full pages work, the next step up is a full page bind-in.  This has great advantages: it automatically gets more people looking at it because of its weight; it has a built-in reply card in most cases; and, it allows you to easily test different offers and/or creative executions.

35. What about testing newspapers?  Certainly worth a test if you have the right product or service because the cost of reaching 1,000 readers is so inexpensive compared to direct mail or even print in magazines.  You see full page ads for “get rich” seminars, but also large space for products like the HairMax Laser Comb.  Newsday, the large-circulation Long Island daily, has a new thing for direct response advertisers – a 2” square colored label that is placed smack in the middle of the first page.  It’s great for getting consumers to call an 800# or go to a site… if you have a fairly broad-based product.

Direct Mail Package Strategies
These are marketing strategies and will often dictate format. 

36. When might an Invitation strategy work?  First, you need to have a soft offer – free trial, free issue of a publication AND “no need to send money now” – to even attempt it.  Copy needs to be relatively light and soft-sell.  And, if possible, the invitation should look like an invitation – closed face envelope, no teaser copy, etc.

37. Perhaps you’ve seen Survey/Questionnaire packages used for non-profits, particularly for political and environmental causes.  Can this strategy work for other applications?  Definitively Yes.  It works for newsletter/magazine publishers and B2B applications.  Again, as with the Invitation strategy, it is most frequently used with a soft offer.  However, the U.S. Golf Association has used it successfully with a hard offer.  The problem with this strategy is that you can’t mail the package to the same prospect more than once a year.  (There is a technique for getting around this rule.  Email me and I’ll let you know what it is.)

38. What are the assumptions behind the Assumptive strategy?  The basic idea is that the prospect or customer has already taken some action (and often this is not true) and the mailing simply asks him or her to confirm it.  For example, if you want to get an executive to commit to sitting in on a web cast, you could use an Invitation strategy, but you might also test an assumptive strategy.  With the latter, the outer envelope might say “Confirming your complimentary reservation.”  With software, an assumptive package might have an outer envelope reading “Your upgrade is now ready to ship.  Please confirm your selections by…”  Copy should be even shorter than in Invitation packages because presumably the prospect/customer has already committed to it.  One advantage of this strategy is that it works extremely well with hard, payment upfront offers.

39. What limits are there to the Professional Courtesy strategy?  Not too many these days.  Consumer magazines have made Professional Courtesy packages work, essentially because recipients believe the magazine has made a mistake by considering them professionals.  The strategy works well to generate upfront payments.  Additionally, while this was originally a minimalist strategy – voucher only – we’ve now seen it work with the addition of full color buck slips and even slim-jim brochures. 

2007 by Lee Marc Stein, Ltd.     

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