Let’s face it – you could have the most loyal customer base in all of direct marketing land. But if don’t continue to prospect, you won’t continue to grow.
Speaking at MeritDirect’s co-op last week in White Plains, NY, futurist Donald Libey said you need to think it through before you decide to scrap or scale back prospecting in lieu of the recent postal increase.
“One thing you all need is new customers,” Libey said. “And it you really do believe you can go ahead and abandon you catalogs right now due to the postage increase, or you can scale back your circulation and survive a gradual transition to online, you’re still going to have to think long and hard about it.”
Libey identified two types of customers: The type you keep forever, and the type you can’t keep very long because of the nature of your business. Either way, he said you’re going to have to look at customer acquisition today more than you’ve ever looked at it before.
“New customer acquisition is more difficult today than it was six months ago, far more difficult than it was 10 years ago, and if you’re doing things the same way you were 5 to 10 years ago, you’re dying,” Libey said. “You may already be dead and nobody has told you.”
Libey said it’s okay to be content with being a second- or third-tier cataloger if you just want to make some money. But you won’t have a chance to be a $100-million business unless you’re willing to grow your company.
“You’re going to have to ramp up your investment in prospecting because there is a first-tier company in your space that is doing, and they are taking business away from you, and the “net gnats,” (mom and pop Internet start-ups) are taking market share away from you. If you do not respond, you are not going to grow,” Libey said.
With that, Libey added that you need to take a look at who is doing your circulation planning. He said that at most companies, circulation is left to the most inexperienced people. Mailers partnering with a co-op database like Abacus will let them handle it, so they don’t think they need in-house circulation expertise.
“Circulation planning is very complex art form, it is the blood filtering through your companies,” Libey said. “It needs to be put in the hands on professionals that actually understand it in depth if you want to get back to productive circulation planning.”