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The following seminar training notes were originally assembled over 12 years ago and have been revised periodically since. The basics information holds up well to the changes in technology. We use this as an introduction to direct marketing and database marketing for persons not well versed in the industry and for personnel training and for a refreshment training session of basic background about direct marketing. During an in-house training session the material is presented with visual samples and tangible materials. Introduction “Direct marketing is an interactive marketing system which is measurable and uses media alone to start or complete a sale” Advertising Direct Marketing Interactive No Yes Measurable No Yes Media Alone Yes Yes Complete a sale No Yes Start a sale Yes Yes It’s an industry were you lose small amounts of money to win a lot of money. (Tests leading to roll outs) Building a Mailing List
Remember: Your Goal is to solicit and maintain a qualified, responsive & profitable list. Realize there is a limit to the amount and type of information people/customers is willing to volunteer. You use appropriate information to communicate to customers in future personalized correspondence. Example: A hotel in a resort area of the United States used their guest registry to solicit guests to return for another stay. The date and personal information generated from their computerized registry was incorporated into a highly “personalized” communication to former guests. Much to the horror of the hotel and some former guests the communication read… “ Dear Mr. and Mrs. Sample, since your last stay at our resort on DD MM YY we have expanded our facilities etc. etc.….” On the surface this personalized campaign would appear to be highly successful. However the marketing people didn’t take into account that on average 30% of guests of that hotel were not accompanied by their real spouses. The complaints and divorce proceedings soared! The hotel alienated 30% of its customer/guest base. Frequent guest program potential was reduced by 30% by this blunder. Remember: the importance of confidentiality in incorporating “personal” information in your out-going communication. Use all information to formulate your mailing strategy internally but only incorporate personal fields of information of consumer data seen by the end-reader only if appropriate and non-controversial. The hotel in the above scenario could have used the Single vs. Double occupancy field of data to merely segment couples from single business travelers and could have alienated no one. The specific date was not required and made certain former guests uncomfortable.
Collect as much customer data information as your data entry and time/financial and computer filing memory capacity allows even if this information is of no use today. Tomorrow the data may be of value to you. For example, when fax machines were first introduced a slow adoption rate occurred. When collecting that information back then compilers neglected the potential of the fax machine. Are you now collecting e-mail and Web address data? Direct response communication has shifted some what towards more electronic media, but “ink on paper” will still rule the direct response industry in business to consumer campaigns and less so in business to business campaigns. Always try to get a handle on their motivation “why they ordered” from your customer. Develop a customer profile category guide. Is the customer a trial buyer?, a senior citizen?, frequent and big ticket customer etc.? The Goal here is that next to one-on-one meeting with a customer, the voice is a good indication of some demographic information the customer may not be willing to verbally advise you. Today’s added value telephone features such as Call Display and similar can only add to generating more data on customers. Where is the direct response/ direct marketing industry today?
Jargon/Term Description/Meaning O/E outer envelope BRE Business Reply Envelope CPO cost per order CPM cost per thousand (m = 1,000 pieces) Rollout the second & larger mail campaign after a successful earlier TEST Solo a mailing with one product offer Co-op a co-operative envelop containing multiple products Self-mailer a self contained mailing piece not enclosed in an envelope Salt or seed mail names on a list, which are company employees or agents to verify Correct use of list rented to third parties and timing and receipt of mail campaigns Mail Order’s “Tainted” Past In the historical past, when you told people you worked in the mail order industry you were almost a social outcast. Today we are in vogue since even the oligarchic banks have recognized the power of direct response to extract more revenue from customers. The tainted reputation came from highly publicized fraudulent operators primarily in the USA. Horror stories range from mail order offers which promised “a fine engraved etching/portrait”. Consumers were robbed when the mail order Company sold them a 5-cent stamp for $20! Technically the ad copy is true; the deception alienated millions when the story received publicity in the newspapers. The next generation of scam ripe off artists offered wicker furniture set which was advertised with a detailed drawing. Customers received over-priced “miniature set of child’s doll house sized” furniture expecting life-size patio furniture! The slogan “if it is too good to be true it is!” was most likely born out of similar circumstances. The furniture ad was technically correct but our DM industry was harmed for many years by frauds. Fraudulent offers led to the creation of DM associations and the development of “codes of ethics and integrity levels and standards of practice. Even association members of the industry bend the rules and guidelines from time to time. For example, a guideline is that the term “FREE” must mean, “FREE” without an obligation to purchase. A “FREE” gift with your first order technically should be a BONUS with your first order if gift premium item has to be returned for full credit if the customer returns the merchandise. However no DM marketer is going to easily give up the term “FREE” even when the premium is truly a bonus! Technically and legally in most North American jurisdictions if the customer insists in keeping the gift item and the offer used the term “FREE” instead of Bonus with purchase the law is in favour of the customer. The Goal of DM is Repeat Buyers and the fraud offer is not long-term good business sense. Remember: your goal is to develop a qualified, responsive and profitable house list. Nature of Consumer Complaints in Mail Order a) Non-fulfillment of order i.e.: “Where’s my F@#*! ing order!” b) unable to cancel music or book club shipments c) awaiting partial credit or refund d) magazine subscription problems e) mail order product not as advertised (substitution is not advisable) f) replacement or refund requests Typical Code of Ethics & Standards of Practice a) offers directed at children must not take advantage of their lack of experience b) all offers must be complete and honest in what is being offered, price, terms of payment, including all extra charges c) all offers must be clear and honest d) offers that are likely to be mistaken as bills or invoices must not be used e) when price comparisons are used they must be factual verifiable and not misleading f) tests and surveys are realistic and valid g) photography and artwork used must accurately illustrate the product h) the clear use of the term FREE Vs BONUS with purchase i) postage, shipping and handling must reflect as practicable as possible the actual S&H costs incurred j) guarantee or warranty info…terms and conditions must be either set forth in the promotion or available to the consumer upon request k) negative option- customers must be clearly informed of his obligations and rights in the original offer l) Goods offered must be shipped within 30 days of receipt of order The Direct Response industry is more of an “art” or craft than a science. DM marketers use calculations and formulas but an offer is a major part of mail order success and no machine or computer will be able to communicate like human to human eliquetely with “ink on paper”. People (consumers and business persons) sort their mail into two piles. Personal correspondence Promotional Mail Invoices, bills, and personal letters all other mail communication Promotional Mail has a 40% or less chance of being partially read. Catalogues are the most beloved piece of “junk-mail” The direct marketing industry is “what” happens rather than “why” did it happen. If you can predict what will happen you will profit. This prediction ability is through testing and then rolling out. Typical Facts in the Industry 50-60% of orders will come in by telephone 40% by mail, email or fax 11-15 days of orders typically represents your response half-life. Customers are time poor. Convenience can warrant premium pricing. Why do people buy through the mail?
2) perceived availability
1960’s -direct marketing was in an era of marketing to the masses 1970’s -segmentation era (A, B, C type of customers on aggregate) 1980’s -niche marketing using demographic info 1990’s -profiling and modeling “individual” customer and scoring their value 2000’s -1to1 communication based on customer self identified preferences
The mail order industry has existed for over a hundred years with the farm catalogues and the SEARS Roebuck era. However it only started into its destiny with the harnessing of economical computer technology (the ability to merge large numbers of lists and purge them of duplicates economically) combined with the proliferation of credit cards and “easy credit” The rapid use of business to business direct marketing was due to the high cost of the sales cold call and even with the face to face booked appointment with a prospect lead or even existing customer. Components of Direct Mail 1. authority 2. easy payment facilities 3. qualified list 4. ease to take action 5. liberal return policy 6. perceived availability 7. hard to find products and services 8. specialization 9. confidence 10. continuity Mail order has an element of perceived authority. Ink on paper and the value our society places on the written word i.e.: “ I read it in the newspaper somewhere, it must be true” attitude lead consumers in believing if its in writing it must be true. Perceived authority from direct marketing companies creates an atmosphere of trust. For example American Express must know about the best luggage because they are in the travel business”.
The ease to take action and order has been made possible by postage paid return envelopes, toll free 1-800 and 1-888 numbers, 24 hours order desks and 7 days a week shopping even on Christmas day! The growth and tainted association of 1-900 numbers has yet to reach its potential. The Internet and E-mail and are hastening the march for more ease to take action by the customer. Junk faxes primarily from aggressive restaurants faxing pre-lunch menus of office delivery specials tainted the fax as a prospecting device. In theory offers that can be illustrated by line-art or black half tone photography can eliminate the cost of printing “ink on paper” since VOIP and cheap long distance rates have also reduced the dependency on the post office to deliver a prospecting piece. The personal intrusiveness aspects of E-mail and the consumer hostility towards and the legislation/regulation against it, did not make it able to realize its full prospecting potential. However retention and follow up to lead generation will be significant since it eliminates the variable cost of mailing traditional printed catalogues and print lists to unprofitable prospects. Perceived availability another element of mail order. Customers assume that a company would not be foolish enough to print a catalogue or post online in their shopping cart selections out-of stock products. They assume you have a warehouse of these fabulous widgets. Back orders B/Os should be minimized at all costs as to continue the customer’s perception of good inventory levels (in stock). The retail equivalent of this concept is picturing you walking into a store with half empty shelves. Even before you ask a clerk for a specific item you are saying to yourself “they won’t have it here!” The power of mail order is that the one-man operator in Maine can compete for the perceived inventory with the retail giant since to the consumer both have inventory.
Historically many mail order products are so classical in nature the mail order purchasers associate the product from the major mail order source as illustrated in the following chart Product or Category Mail Order Firm Trend Setter Duck boots LL Bean Newspaper re-cycle bin LL Bean Lightweight vacuum cleaner Oreck vacuums Short radio multi band radio Grundig Career training ICS Romance Harlequin Panty hosiery Hanes, Enchantress Boys toys electronics Sharper Image House wares hard to find Brookstones Confidential lingerie Frederick’s of Hollywood, Victoria Secrets Collectible Franklin Mint/ Bradford Exchange Time management diaries Daytimers house wares Regal Greeting & Gifts Books Double Day/ Book of the Month Club Music Columbia House Cosmetics AVON Gardening Mackenzie Seeds/McConnell D.I.Y. (Do-it-yourself) Time Life Children’s books Grolier Health books/ home remedies Rodale Giftware decorative accents The Added Touch Business products Grand & Toy Photo finishing Scot Foto, York Photo Labs, Mystic Labs, Electronics American Express Travel American Express Gift baskets & gourmet foods Omaha Steaks Furniture Bombay Company
Worldwide rationalization & specialization: Mail order operators who specialize have been acquiring competitors outside their domestic market. American firms have moved into acquisition into the UK & Europe and Asia. Even with language differences and differing postal regulations in individual countries mail order offers have gone international. Consumer Confidence: As more consumers use mail order the general level of all direct response ordering increases. The Advantages of Direct Marketing
2. home based operation 3. competitive with larger organizations 4. low inventory risk 5. low overheads 6. flexibility 7. part time possible 8. quiet method to test products without competitors reaction 9. multi product opportunities 10. security of facilities 11. vast market opportunity 12. lack of competition 13. test/roll advantage 14. lack of competitors’ expertise in the field 15. ease of obtaining competitors’ methods Independence from employer and employees is a benefit of mail order business. You can literally be a one-person organization. Most rags to riches success stories have the founder starting at the kitchen table building to millions of dollars sales etc. You can compete with large organizations and being a smaller organization you can react to market changes faster than the giants can. In a publication your ad if all things are equal (size, colour etc.) can compete head on with the multi-international company. Still another advantage is low inventory risk. Your only inventory could be actual photography samples but you should base your inventory on the lead-time of replenishment from your supplier. You will have the advantage of low overheads with no need for expensive retail or office leased space. And flexibility is your advantage as you can shift from gift baskets today to electronics tomorrow. How many retailers can even achieve that? Part time activity is possible and recommended. Don’t quit your daytime job until you’re ready and profitable consistently. Mail order is a quiet industry similar to an attack U-boat/submarine. Their success in a motto was “run silent…run deep”. Mail order operators can be very secretive about their successes... And competitors if not monitoring them will be unaware of your activities for years! Mail order has An advantage of having limitless products, as a store is limited to its space restrictions. Security is advantage as you can avoid high crime retail areas and operate in peaceful and safe suburbia or out of the cottage! In the USA, historically the concentrations of mail order companies are in three basic geographic zones. New England, Maine, Connecticut and Vermont due to sales tax exemptions and the bricks and mortar rule etc. 2. The mid west Minneapolis which is half way freight for west or east bound traffic and 3. San Francisco the traditional import gate from the Orient and the great lifestyle advantages of San Francisco. In Canada the direct response industry is centred firmly in the greater Toronto area with only a limited Montreal based firms promoting in the French language. Also market image of the operation and the lifestyle and residence preference of the owner & management are key. Who wants to buy Maple Syrup from a company in New Jersey? Wouldn’t you perceive a maple syrup mail order firm located in Vermont as better? Who wants to buy confidential lingerie from a Mail order company in Rochester New York … wouldn’t you prefer to deal with a company in Los Angeles/Hollywood! Although the marketing wings of big mail order operations have executive offices in glamorous locations the fulfillment centres/warehousing & shipping are usually located in less expensive labour rate areas with access to border and postal connections such as Buffalo NY and Windsor, Ontario. Test/Roll scenarios in which you test your offer in a mailing of a small size and once you have analyzed the results of the test you roll out to larger mailings to more prospects cautiously. You’ll also benefit from the lack of expertise in the field at your competitors. You will also benefit from obtaining your mail order competitors’ methods if you are persistent in monitoring their mailing programs. If you buy and stay active with small orders from your competitors you and their other house file customers will see most mailings Hand written white mail is most always circulated in management circles for “testimonials” potential etc. Positive white mail is harder to be destroyed by the competitors’ clerical staff trying to find a home for the request. By using Mrs. you are indicating your sur-name may have recently changed due to marriage and Your recent move without a telephone # will make it impossible for the competitor to confirm if you are a legitimate former customer or not. He will not take the chance and your catalogue will be speeding its way to you soon. American firms neglect Canadian requests regularly since they may not market into Canada but by risking alienating your American friend in Florida who regularly buys from the catalogue and even recommended that you write your catalogue will also be speeding to you. Write to the President since the quickest way to the mailroom is from a top-down request. Start Up what to do first?
2. Set up a bank account in the company’s name 3. Apply for a Vendor permit number for sales tax collection and remittance and exemption when buying goods for re-sale 4. Apply for a VISA & Master Card Merchant Account directly from banks or start as a PayPal merchant 5. Arrange for a business size post office box 6. Arrange for a BRE business reply permit number from post office 7. Order business cards and stationary 8. Designate a specific work space for your office 9. Get a combination telephone answering machine and fax/copier 10. Get a home computer PC with appropriate small business software especially mail merge./sort capabilities 11. Find sources of products and arrange to open accounts with favorable terms and conditions 12. Organize your shipping and warehouse space 13. Source suppliers of shipping cartons and materials 14. Determine pricing and shipping and handling charges 15. Arrange for creative and production 16. Mail or test the offer in a small way 17. Fulfill the orders 18. Analyze the results to see if its profitable 19. Mail a larger Roll quantity 20. Develop a bounce-back offer 21. Source new products and test 22. Mail more and new offers to your house file of existing and former customers 23. Monitor the competition and learn
The reason why we want to monitor your mail order competitors and even non-competitive mail order operators is to learn their mistakes using their money. The rule of two is a simple rule of thumb. If you see an offer from a competitor once it may be just a test, which failed and was unprofitable. If you see it twice it is working and profitable for your competitor. The more mailing lists you are on the more you will be become familiar with winning offers, formats. Embrace all “junk mail” read it and consider it a FREE home correspondence course. Even place small orders from time to time even with competitors to stay on their active and hot list/files. Principles of Direct Mail Success 1. Have a strategic plan 2. Address correctly to the right list 3. Write benefit copy 4. Make your offer fit 5. Make it easy for the customer to act 6. Use direct mail with continuity “use it or loss it” 7. Research and test The strategic plan of a mail order operation is KEY. The most successful growth rate is small business/single entrepreneur. The one-person focus may be autocratic but successful until The manager burns out. The few employees and most functions can be farmed out to ad agencies, and fulfillment houses. The committee system is the one, which inspired the saying… Remember “A camel was a horse designed by committee” Address correctly to the right list. Since third class if not delivered will be destroyed by the Post Office. The right list is the qualified and targeted prospects. Verify and check postal codes. Buy an annual postal code directory. Use every opportunity for past customers (house list) to verify or update their address information. Use bold and simple instructions on your order forms “ Is this your correct address?” The salutation of Mr., Mrs. & Ms. is extremely important and the spelling of your prospects and customers names is essential.
Write Benefit Copy. Sell the sizzle not the steak!” For example… Benefits Vs. Feature (Safe) can be seen at night florescent neon colour Compact/pocket size measures 2” X 1” X ¼” Always answer the consumers’ question “What’s in it for me?” Make Your Offer Fit Is your company perceived to have expertise to market this product as well as does the brochure fit your image! The classical example is of “Granny’s Cookies”. A slick Madison Avenue campaign failed, while a one-colour brochure campaign succeeded. The reason is that Granny’s Cookies were perceived to be homestyle. /folksy etc and the Madison Avenue slickness turned off customers and prospects. Make It Easy for your Customer to act. Toll-free or at least call collect to place orders. Seven days a week even on Sundays. Even on Sundays is not redundant copy. Customers sometimes don’t believe staff will be working on Sundays and holidays and will not call. By highlighting even on Sundays incremental sales are achieved. Your goals here are to over come human inertia. The classic “couch potato” must be blasted off his seat to move to the telephone with his VISA or MasterCard credit card to place an order. Only amateurs in mail order expect cheques or money orders from new customers or the financial staff is more dominant than the marketing and sales organization in the company you are dealing with. Use Direct Marketing with Continuity. Use it or loss it” Follow up quickly with addition offers to responsive lists with compatible offers. Since 20% of addresses change annually and students and business people lists change at a 30% rate of turnover annually. This is why mail order companies rent their list to others to clean their list up and to test new product categories to their house list using other people’s marketing dollars. If a company continually rents your list and is selling a different kind of widget than you are, perhaps after a while your company should sell that widget also? We should at least mail the top 20% of list more frequently than the average.
Research & Test You should test different segments of your list and test different offers in price, bonus, copy and formats.
12 Rules for Direct Mail Testing 1. test one thing at a time or everything 2. make sure your test lists are representative of the entire list 3. keep track of the portion of the list used for testing 4. be sure to use a sufficient quantity to obtain a reliable test 5. consider two flight testing (test of a test i.e.: follow up an initial test to make sure some extraneous factor hasn’t prejudiced the initial results 6. mail all pieces at the same time 7. don’t make any major decisions on minor results 8. don’t follow results blindly 9. don’t get test happy 10. don’t try to read non-tested factors into your results 11. follow up quickly 12. continue to keep tab on your results
Why do you test in direct mail? Because… Copy writing variations can see changes in response from 10% to 300% ranges Offer variations can see changes in response from 100% to 500% ranges Timing variations can see changes in response from 10% to 50% ranges List or segment variations can see changes in response from 100% to 1000% ranges Package alternatives can see changes in response from 50% to 300% ranges. Test yourself as a typical cook/ weekend chef. Which book would you buy or respond to if you saw these two ads? “How to Make Your Cooking Taste Better! Or “ How to Get Your cooking Bragged About!” Remember: “an offer expressed differently is a different offer” Another example from Macy’s department store eye glasses offer. Which is the better offer? ½ Off 50% Off Buy one and Get One Free Two For the Price of One (Answer is below!)… Buy one and Get One Free is the Best and beat the other offers and two For the Price of One by 30% Another example: Which is the best offer? Any 3 Records for 25 cents each. OR Any 3 Records for $1. Buy any 3 Records for $1 was the best. Consumers have become mathematically LAZY due to pocket sized electronic calculators. The lowest price is not necessarily the best offer. Spectrum Testing Consider your test dollar budget in radiating circles and ranges. Spend 50-70% in your core business lists. Spend somewhere between 30-50% of your test budget in affinity lists and be risk taking enough to spend between 5% to 30% of your testing resources in outreach lists. These are the list recommendations if you were employed in the big league direct mail operations that make your marketing superiors and especially the financial personnel raise their eyebrows and think you’re crazy! If you do not risk you will not find those winning gold mine lists. Mail order testing is like a submarine warfare strategy “run silent and run deep”. Once you find a lucrative outreach source of list(s) continually mail and reap profits silently until your competition becomes aware of your success…(Hopefully years later!) Never roll out to more than 10X your initial test quantity And use pyramid testing for added security in preserving your testing resources. Test to 5000 than roll out to 50,000 than roll out to 500,000 etc. Basic Requirements for Mail Order Success FRONT END 1. definable market 2. an accessible market 3. universal and unique products 4. products with adequate margins 5. products which can be packaged and shipped at reasonable cost 6. continuing sales potential and repeat sales BACK END 7. outstanding Customer Service 8. understanding financial people 9. outstanding Fulfillment people A mail order operation’s functions can be divided into front and back end sections. Most new mail order operators fail due to BACK END problems. A Definable Market A product, which is perceived to be needed by some group of people can be premium, priced. An accessible market which has a qualified compiled list of prospects. Use of universal and unique products…although at first this seems mutually exclusive universal products are key since mail order is a numbers game. The more people interested in your product the more chance you are likely to succeed. However the uniqueness of your products and service can make the offer unique in the simple method of delivery for example. Mail order can deliver right to the customer’s door. Adequate margins is key. Traditionally consumer mail order merchandise has 3X to 4X mark-up. Franklin Mint merchandise has 6-8X mark-up from factory cost. At least 2X mark-up is required in one-time sale products. Lower margin percentage and lower mark-up is required if repeat sales and larger $ volume sales are generated in your offerings. Some product categories can not bare higher mark-ups in mail order such as consumer electronics. Packaged and Shipped at reasonable costs. Since returns are an anticipated and should be considered unavoidable expense to any mail order operation you must incorporate a certain percentage of returns to your operation. A benchmark in the industry is up to 15%. However some products such as office products should be less than double digits where fashion and gift items can be up to 30% returns. Evans Furs a mail order specialist experienced 30% returns as a normal percentage in mail order offers of luxury fur coats. Continuing sales potential and repeat sales is key to your long-term success. Think to the ideal of a habit-forming product. If you could ethically come to terms with selling cigarettes by mail order this is what mail order operators dream of. The closest thing to this would be a consumer oriented consumable product. Classic examples for mail order success stories are the Hanes Panty Hosiery scenario and “A Better Way to Feed Birds”. In the Hanes example, Hanes the panty hosiery giant was faced with a warehouse of imperfect and seconds merchandise they had collected. This distressed merchandise was unacceptable to Hanes’ wholesale and retail customers. So Hanes developed what they thought was a one time quick fix in which they offered to the buying public Hanes “seconds & slight imperfections” via mail order. The program was so successful that Hanes had to fulfill original program orders with first quality merchandise! This type of program lead to replenishment programs or continuity oriented panty hosiery mail order offers and has inspired numerous knock off campaigns such as Enchantress hosiery etc. The second example is a “Better Way to Feed Birds” in which an entrepreneurial company used a two step prospecting campaign to develop their success. They offered through cheap classified and display newspaper ads FREE information on what birds ate what seed. By circulating reprints of government agriculture/wildlife documents they appeared to the public as a government endorsed program. The program and offer captivated seniors, naturalists, and bird watchers and handicapped hobbyists who enjoyed backyard bird watching. Along with the free government reprint a continuity replenishment offer was attached. By the way there is $173,000,000 of birdseed sold in the USA annually! This mail order firm tapped into a portion of this market inexpensively! The BACK END The best and easiest and most profitable sale should be to previous purchasers. Since you do not need to waste time and effort in promoting your business to first time trial buyers and you can devote all the space for photography and copy selling the products. Your bankers, investors should understand financial people. It takes several years to build and maintain a new list. No house list should however ever lose money. Lifetime analysis of the future value of a customer should be considered. There are numerous articles and literature on the topic of lifetime value but the general rule of thumb once you have accurately calculated the value is to spend up to 1/3 the life time value of a customer to acquire a customer. Theoretically you could spend up to $0.01 less than the LTV to get your customer since you will recoup all costs and gain that incremental $0.01 profit. However due to the risks and changing market conditions the general rule would be to spend about 1/3 of the LTV to acquire. However once you have calculated your customers LTV and we discover to your financial people’s horror and your acquisition manager’s surprise you have been acquiring new customers at too high an acquisition cost you have two basic options… 1. sell more expensive merchandise to your customers in the future 2. use cheaper acquisition methods Even big mail order giants discover from time to time that their acquisition costs and marketing need to be re-aligned. Outstanding Fulfillment People People buy on impulse in mail order. The faster you deliver the lower the return rate will be. Remember that your shipping carton, collateral brochures, and printed correspondence is the equivalent to your “salesman” A professional appearance of your shipping package is an important factor in determining by the customer if he is going to keep or return your merchandise. Customer Service Standards In the Mail Order Industry Ranked from State of the Art in the industry to minimal tolerance by the customer. Order Entry Cross selling Product expertise Flexible discounting Personal shopper On-line product availability Toll free access Fast telephone pick up Accurate order entry
24 Hour Inquiry live human inquiry On-line access to order status Accurate delivery date Manual look-up Delivery Express delivery Timely delivery Correct product Appropriate quality When available Returns No hassle Courier pick-up arranged by vendor Fast action Merchant’s expense Unconditional guarantee Faster action Limited time period warranty Customers’ responsibility Slow action How to Determine Shipping & Handling Charges
Business reply postage or toll free telephone costs Order processing & customer set up Credit card fees (S/E discount from VISA, MasterCard, American Express etc.,) Customer service costs Collection effort costs Shipping freight, courier and or postage costs Warehousing labour Packaging materials Returns postage/freight Returns handling and processing Refurbishing costs Additional profit? Classical Mailing Package Components 1. the outer envelope O/E 2. the letter 3. enclosures 4. the action device (order form) 5. the reply mechanism There are two types of mailing packages self-mailers or full direct mail package. There are numerous direct mail medias, which include
Display space advertisements in periodicals Co-operative envelops Inserts Catalogues Self-mailers Full direct mail packages Multi-media campaigns To understand the hybrids & variations of the classic media you must first appreciate the basic design. The Outer Envelope Mail order is the personal media. A letter is to be confidential. It is a crime in our society to open other people’s mail. Remember the first letter you received as a child…probably a birthday card/letter from a rich and distant aunt enclosing a cheque or better still cash! The power of the personalized letter is key in our society since it has historical and emotional roots…childhood memories & greed! The O/E is really like the salesman’s clothes. Appearances are everything. Full D/M packages will out pull self-mailers in responses except in the “stand-up” professions such as offers directed at teachers, librarians, engineers and academics etc. Studies of eye movement of people screening their mail have indicated that people’s eyes and their attention move in the following order…. 1. The addressing portion Mr. John Smith 123 Elm Street etc. 2. any teaser copy statements on the envelope to the left of the addressing 3. to the upper left hand corner to verify the sender and the sender’s return address 4. to the upper right hand corner to see how much postage and or the postage classification used and or date of postal mark 5. and if the envelope is perceived to be “promotional” mail to the back of the envelope An O/E personalized with the prospect correctly spelled name; title and company address is optimal. Teaser copy on the front of the envelope (preferably using the words YOU, NEW, FREE) is best. The return address corner is always good to identify yourself to satisfied former and existing customers. For prospecting, it is not always wise to identify yourself on the outer envelope. The classical American Express re-activation DM campaign is addressed in a non-identified envelope with the teaser copy “Do you believe in giving somebody a second chance?” Card members who have canceled an AMX credit card are drawn back to AMX by this intriguing copy. If AMX identified itself on the outer envelope the emotional ex-cardmember that tore up his plastic credit card days before would not open the envelope. The area on the envelope where a person normally associates with the stamp area is important. The best-ranked use of techniques in this area is from best to worst the following…. 1. multiple stamps 2. commemorative stamps issued by the post office 3. first class 4. bulk third 5. metering 6. printed indicia is worst Note: In business to business prospecting, the mail order operator faces another hurtle to cross the dreaded “secretarial sabotage” To avoid this, use methods such as highly personalized and title addressing and even teaser copy such as “Here’s the information you requested”
The most important part of the personal medium is the classical “secretary prepared letter.” The letter format can change response up to 150% difference. The same eye movement studies have concluded that the person’s eye and attention move in the following order when reviewing a letter before they actually decide to read the letter in its entirety… 1. letterhead on stationary 2. the personalization addressing 3. the signature and title of sender 4. the PS on the bottom 5. the actual body copy/text of the letter If your data dosen’t have the exact name of the President of the company state: “Dear President” or “ Dear Owner” etc. In the PS copy curiosity copy is best to drive the reader back into the text of the letter. For example use “PS. As you will agree this new product can make unbelievable profit margins for your company etc.” Never type set a letter. Don’t listen to your art director’s advice. Letters should appear to be type written! Never place the sender’s photograph on the letter unless he/she is a national celebrity spokesman. A letter is never too long only too boring. Write enough copy to generate an order or response from the reader. Enclosures/Brochures The brochure of a full D/M package is required if your product or service require illustration or amplification. Ad agencies will push you towards a full colour brochure but test without a brochure if you are marketing a simple product known by everyone. For example Department store’s mail order wings could sell children’s videos by statement text messages solely if the product is well known by consumers. For example “ Order your Disney Aladdin Video for $19.95 by calling 1-800-SEARS today”. Remember in the personal medium the brochure is a dead give away your mailing is truly promotional. In consulting services a proposal for a consulting contract which is highly personalized is de-valued by a consultant’s colour brochure. Action Device Your order form should be able to stand-alone. It should describe to the customer everything he must do to receive your merchandise. Telephone numbers should be bold and in another colour. There should be an acceptance paragraph in which the customer checks off YES, send me the following merchandise under the conditions described in your attached offer. The Reply Mechanism BRE Business Reply Envelop. The classical example of this is the #9 envelop which fits inside your #10 Outer Envelope in which the customer encloses his completed order form. Toll free order desk fax and telephone numbers have speeded up the ordering process. Creative and Copy writing ten keys to Creative Success in Direct mail
1. realize that it is a personal medium and use (YOU, ME, IT copy) 2. understand the 4 major concepts of a) availability b) authority c) value d) satisfaction 3. know and use your USP (unique selling proposition) 4. use benefits copy 5. be clear, interesting, concise, believable and friendly 6. have your copywriters read your white mail, study past copy and response rates, review competitive copy and study all relevant reference material 7. write the acceptance statement first 8. realize the importance of the direct mail letter 9. have a trained DM editor review 10. understand how design and graphics impact response Develop and know your USP (Unique Selling Proposition). You should only have one. This shouldn’t be a slogan or Madison Avenue hype. “A copywriter’s job in mail order is not to write copy…it is to sell!” He/she should write the response device (order form first) and should answer for the prospect the following 1. What am I to do? 2. What do I get if I do it? 3. What other things to I get? 4. What is the enhancing conditions? You shouldn’t use a general advertising agency. You should use a specialist agency experienced in direct response. We have two languages.written and oral. Write with the ease in which you speak. There are… Five “Musts” in copy writing 1. Is it clear? Remember in copywriting there is no body language to set the mood 2. Avoid industry jargon “COIK” Clear Only If Known” 3. Don’t over estimate the knowledge of the reader. Remember the Wall Street Journal writes to the level of understanding of Grade 11 reading skills. 4. Don’t use excessive adjectives i.e.: “a full 5 quarts” 5. Use active verbs not passive For example YES- “The car hit Lucy” NO- “Lucy was hit by the car” Never read copy drafts out loud. Read it as if the customer was reading it by himself! Six Things To Edit Copy For 1. warm up copy 2. stoppers-awkward words & phases 3. author’s pride 4. is there good transition from paragraph to paragraph 5. Is there a reason why (proof not BS!) 6. enough Benefits (the heart of selling) Basic Catalog Design
Vogele’s Research on How People look at catalogues and brochure pages… When looking at pictures…people before products Portraits before full figure Illustrations larger before smaller Outline close cropped … before framed halftones Colours…warm before cool and neutral Borders…. Copy inside a border before copy outside Blasts/starbursts…get instant but fleeting attention Rules to Live By 1. use white space effectively 2. Flesh tones are important when selling merchandise’s colour is important to customer such as luggage or clothes (if the skin tones are true looking then the customer assumes that shade of purple is really purple and not mauve!) 3. roman and serif type face is easiest to understand 4. never use sans-serif type 5. copy on coloured backgrounds is dangerous 6. copy printed in coloured inks is dangerous 7. reverse type is dangerous Seven Basics of Successful Catalogues 1. Decide who you are and stick with it 2. Develop a catalogue to project your image 3. Make your catalogue easy to use 4. Organize your catalogue like a retail store 5. Trade on your winners say good bye to losers 6. Make it easy to order 7. Take advantage of the hot spots a) front cover b) back cover c) inside front cover d) pages 3,4 5 e) inside back cover f) centre spread g) pages facing order form h) pages facing other inserts Remember: the average catalogue reader gives a catalogue spread 20 seconds or less to determine if it is worth reading Success in Mail Order Copy writing 1. use emotional words instead of intellectual words 2. use short words (70- 80% should be 5 letter or less words) 3. length of lines should not be more than 62 characters 4. don’t be a slave to English grammar Remember… “Words can burn like acid or soothe like a lullaby and cut like a razor” Should you write to a Formula? Yes if you’re comfortable using. AIDA Attention, Interest, Desire, Action KISSS Keep It Simple, Sincere, Serene PPPP Picture, Promise, Prove, Push RIC Readership, Involvement Commitment
Intellectual Word Emotional Word abhor hate accelerate speed up additionally there’s more aid help beneficial good for difficult tough dine eat exchange swap fortunate lucky huge giant ill sick inform tell large big prevent stop reply answer strike hit tardy late utilize use wealthy rich
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