PROSPECTING: From Web to print to Web

Multichannel marketing gives rise to new uses of Internet lists

In the latest wrinkle on multichannel marketing, a number of catalogers are renting the postal addresses of Internet buyers, then mailing these prospects direct mail pieces to drive them to their Websites.

Licensed sports team apparel cataloger Star Struck is one such marketer. Marketing manager Missy Robinson says that, following several successful tests, Bethel, CT-based Star Struck will go ahead with a full-blown program this holiday season. Instead of mailing a full-fledged catalog to prospects, the cataloger will mail a flier advertising the Website to drive traffic online. Star Struck sees this as a cheaper way of acquiring customers than mailing a catalog, Robinson says.

Star Struck receives 70%-80% of its rental names through cooperative databases such as the Abacus Alliance. During the holidays, Star Struck typically ups its prospecting efforts by about 20%-30% by also using traditional mailing lists, such as Sports Illustrated’s subscriber file. But this year, the cataloger will rent the street addresses of Sports Illustrated subscribers who have purchased from the magazine’s Website.

But renting the postal addresses of proven Web buyers has its own costs. Internet buyer selects are usually more expensive than the more traditional recency, frequency, and monetary value selects on most lists.

For instance, the three-month buyers select for apparel cataloger J. Crew’s file costs $125/M, says Bob Stein, senior sales executive at Hackensack, NJ-based list firm Mokrynski & Associates. But the postal addresses for J. Crew’s three-month online buyers file cost $170/M.

Adding the Internet buyer select

If you make your list available for rent, and you market via both print and Web catalogs, you should consider adding the Internet buyer select to your list. Michelle Feit, president of Pearl River, NY-based e-PostDirect, a spin-off of list firm Edith Roman, says failure to do so could cost you additional list revenue. “Everybody is doing offline marketing to drive their customers to the Web,” she says.

According to Mokrynski & Associates’ Stein, catalogers looking to add the Internet select should compare the prices of competitors offering that select to determine how much to charge for Web buyer names. And don’t feel that you have to wait till you have, say, 10,000 Web buyers before you can start to offer this select. “All those names are responsive and hot,” Stein says.

The e-mail select

This is not to say that e-mail selects on catalog mailing lists are now passe. “Savvy catalogers are asking for e-mail names connected to traditional lists,” says Roy Schwedelson, president of Boca Raton, FL-based list firm Worldata, which offers a significant number of e-mail-related lists. He says more of his clients are asking for e-mail selects than ever. “There’s a big crossover right now between the Generation Xers [those born between 1965 and 1980] and Generation Y [born after 1980] who are connected to the Internet from both their home and business.”

But again, e-mail address selects are not cheap. In fact, addresses with opt-in e-mail addresses are even more expensive than the postal addresses of online buyers. Consumer lists with opt-in e-mail names will run about $250/M-$350/M, says ePostDirect’s Feit, while business-to-business lists with opt-in e-mail selects cost about $400/M-$500/M. And unlike the postal address selects of Web buyers, opt-in e-mail names are not necessarily proven buyers. Many of these consumers have simply opted to receive an e-mail newsletter.

Worth the risk?

Given that e-mail names aren’t necessarily online or print catalog buyers, renting those names may seem like a risky and expensive proposition for mailers. But catalogers that want e-mail selects have few other choices, considering that many marketers are hoarding their lists of proven Internet buyers rather than offering the names for rent. Opt-in e-mail names, Schwedelson says, “are the best we have right now.”

During its yearlong existence on the Web, Framingham, MA-based Toysmart advertised in its private policy statement that it would never share customer data with a third party. But now the failed online toy marketer is feverishly shopping its assets – including its customer database – on the open market.

If you are considering buying Toysmart’s list – or that of any other now-defunct i.merchant – you should probably think again. At press time, the U.S. government was trying to block the sale of Toysmart’s database, claiming that customers had been assured that their information would not be made for sale to another party.

“If the marketer had something as explicit as Toysmart had in its privacy statement, I would stay away from that list, because the customer has told you in effect they would not accept offers from a third party” says Chad Slater, vice president of Stamford, CT-based list company MeritDirect. “As a mailer, I want to mail only to receptive customers. So what good is that list?”

Marketers also need to find out exactly how a dot-com company acquired its customer names before they make any sort of offer. Many Internet companies loaded their product offerings with heavy bonuses, discounts, and premiums to attract buyers, Slater explains, so these customers may not work well for full-price offers.

For instance, when now- defunct online pet products retailer Petstore.com was soliciting customers, it was offering a promotion of two bags of pet food for the price of one. Unless your company is prepared to offer these customers the same types of premiums, Slater says, you might want to pass.

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