Thanks to the internet, the advent of paperless billing, electronic bank statements, and on-line catalogs, commercial mail volumes have dropped over 50% in the last ten years. There is no longer the huge clutter at the mail box–and that’s good news for local retailers who are re-discovering the effectiveness of direct mail advertising. Less mail means that your postcard or letter is more likely to be read, so response rates to direct mail advertising are trending upward. Maybe it’s time to think again about this proven advertising method.

For many retailers, even high-end stores, direct mail is attractive because its positive effect can be measured directly and quickly. It has a tremendous potential to reach a very specific and select audience. Further, direct mail is a great way to stay in touch with your current customers and keep them up-to-date on special offers or announcements.

Many retailers spend a lot of time and money in the production of the mail piece and the mailing. Yet, it’s important to realize that while you may have the most creative mail piece, the success of any mailing begins with the right mailing list and target audience. Many direct marketers use what is called the “40/40/20 Rule”, which claims 40 percent of the success of your direct marketing campaign is dependent upon the audience, 40 percent on the offer, and 20 percent on the copy and creative format of the mailing. Since 40 percent of the success of your campaign is dependent upon the audience, it is imperative that you have the best mailing list possible.
There are many sources for consumer mailing lists. Many are so called “compiled” lists are generated from names and addresses found in phone books and other public sources of information. These compiled lists are overlaid with demographic census information that give a general indication with regard to age, income, presence of children, home value, zip code, etc. The problem with these lists is that they are general and not specific. So where do you find that magic list?

Sales and marketing database: Customer information stored on your computer system or your OutlookTM database is a good starting point. Many point of sale systems used today have the ability to transfer customer information into your database every time you run a credit card.

Partner with someone who has a non-competing product: Your competitors are unlikely to share their list with you; however another local retailer may agree to share or exchange their list with you. If they sell a similar product with a similar customer base, that may be even more advantageous. Exchange your list with other retailers then remove the duplicates on the master list. Your local “letter shop” or mail house can run a program that will remove duplicates and verify and update the address information to make sure the records are current.

Current customer recommendations: Offer an incentive to your current customers to recommend friends and relatives.

Your employees: Everyone in your company is a potential source of prospect names.

Once you have exhausted all other sources to develop your list, you may want to research compiled mailing lists. Match the demographics of your own customers with that of the list you rent. You might want to do your own customer survey and try to develop your own customer profile—what is your typical price point? What’s the average customer age? Are they married? Do they have children? What percentage are male/female, etc.

There also are list companies that buy lists from catalog companies. This may offer a better list than a “compiled” list because you will be renting names that have purchased from the catalogs, and therefore you already know that they are responsive to that type of advertising. There have been studies that say 50 percent of families will not be motivated to buy anything by mail If that is the case, renting a catalog list already eliminates those that are not responsive to direct mail marketing.

Another possibility is to purchase a list based upon change of lifestyle. Lists are available for new movers, giving you the names of families that have recently moved into your area. Recent engagements and bridal registries are also excellent sources. Community newspapers also may rent their subscribers list to you.

When purchasing any “outside” list, make sure you ask the list broker for an accuracy guarantee. The list should also be cross referenced with the National Change of Address (NCOA) database, ensuring that the list is current, complete and accurate.

Once you’ve exhausted all of the sources to build your mailing list, you need to continually test and track it. Put together a mailing plan for the year and create mailing campaigns in advance of the traditional Christmas buying season. Valentine’s Day, Mother’s Day, spring weddings, graduations are just a few of themes around which you can build a marketing campaign. Remember, your goal is to create a new customer, not just make one sale. To accomplish this, you need to have a database so that you can track the number of sales made to each customer and monitor this regularly.

With the right mailing list and customer database you’re on your way to direct mail victory. But just because you start to see that your prospect list is paying off, don’t stop there. Continue to build and refine your mailing list. It should be an ongoing project and part of your strategic business plan. When you use your mailing list properly, and integrate it wisely into your overall marketing plan, it has the potential to become a powerful marketing tool. SSA

 

Bob Epstein HeadshotBob Epstein is CEO of Silverman Consultants, LLC.  Offering a legacy in sales strategies for retailers since 1945, Silverman Consultants provides guidance to store owners seeking to turn around a business, sell off unwanted inventory, or liquidate an entire store. With offices located in Charleston, South Carolina; New York, New York; and Saskatoon, Canada; the company helps retail store owners and chains formulate strategies designed to maximize revenue in times of transition, whether due to retirement, store closing, or simply when needing a boost in sales. For more information, visit www.silvermanconsultants.com or call Bob direct at 1-800-347-1500.