Insert Media: An Alternative for Prospecting

Time and again during the past two decades, American Stationery Co. has inserted the same style of embossed stationery sample in other catalogers’ outgoing packages. And for good reason: It’s a proven winner, generating 20%-30% of the Peru, IN-based company’s orders, says spokesperson Paula Christersen: “If it’s not broke, don’t fix it.”

On the other hand, As We Change, a cataloger of health and wellness products for women 40 and older, tried insert media without success a couple of years ago, says vice president Cathy Murphy. While the San Diego-based firm continues to accept package inserts to generate extra revenue, it has no immediate plans to try prospecting with insert media again. “We found the cost was out of line” given the meager response, Murphy says. But she acknowledges that the channel can be effective for others. “It seems to work for catalogs that are much more focused. Ours is too broad,” Murphy suggests.

Many catalogers, it seems, have tested insert media for prospecting and retreated when response didn’t meet expectations. But experts say that success requires trial and error.

“People give up too early,” says Leon Henry, founder/CEO of Scarsdale, NY-based list firm Leon Henry Inc. When using package inserts in particular, patience is important. Unlike space ads or direct mail through list rental, it may take months before the marketer receives full response to a package insert, because packages are sent out over a period of time.

What’s more, “people want to jump into the business without doing the testing. If they don’t test correctly, everything else is downhill,” Henry says.

Even American Stationery has had inserts flop. In fact, Christersen says, the company has tested many offers in addition to the winning embossed sample. ‘We’ve tried to find other things that would work as well, like labels and something Christmas-y,” she says, but nothing else draws customers in. In general, insert media specialists say, it’s best to test popular products and those with lower price points.

Many catalogers like the “minicatalog” concept as an insert. Besides generating interest, it also can be effective at generating orders. Compared with prospecting with a full-size catalog, MSC Industrial Supply found a 16-page minicatalog “a more efficient way of generating prospective names,” says Jack Rayher, marketing director for Melville, NY-based MSC’s tool division. The company picked a subset of its best products for the mini, which was distributed in the window position of card decks.

But minis can be difficult to assess because they have more variables than a single-product offer. That’s why Henry recommends starting with a space ad you already have composed or an offer you’ve had experience with, so that you have a frame of reference.

In addition to testing the offer, American Stationery has tested the companies with which it places inserts. The company has found that its offer works best in jewelry and gifts marketer Ross-Simons’s outgoing packages. “We’ve been in there forever. It’s tried and true,” Christerson says. “We’ve tried some lower-end ones, and they don’t respond well.” Ross-Simons’s customers, on the other hand, respond in droves. “That’s the customer who buys stationery — someone who spends a lot of money on someone else,” she says.

Even when marketers do test, they may have unrealistic expectations. “The response rates for solo mailings will generally be higher than for package insert programs or a co-op mailing, but the cost is so much lower to do alternative media, you don’t need the same response rate to make it work for you,” explains Al Stanton, president of Stanton Direct Marketing, an Elmira, NY-based firm that specializes in insert media.

The average package insert has a base price of $50/M-$60/M on its rate card, but that may be negotiable. Blow-ins cost even less, with base prices of $30/M-$35/M. With prices so low, it’s a wonder more advertisers aren’t taking advantage of insert media, says Lisa Roland, president of New York-based Everyday Media, a media buying and selling agency specializing in alternative direct marketing: “Why wouldn’t you want to go through to other catalogers’ proven buyers?”

In fact, because package inserts are going to mail order buyers, they generally convert more prospects than catalog blow-ins or other media such as statement stuffers.

“When you’re speaking only to mail order buyers to begin with, you have a better starting point,” says Steve LePera, media director for the Mantis division of Schiller-Pfeiffer, a Southampton, PA-based manufacturer of outdoor power lawn and garden equipment. But Mantis has also tested — and now uses — card packs, bind-ins, blow-ins, statement stuffers, and co-op mailings, which offer more volume.

“Because of the generally low cost to prospect,” LePera says, “we have branched out to any number of programs, some of which don’t have a whole lot of obvious affinity to gardening.” For example, Mantis has had success with inserts in shoe programs that share the company’s older rural and outer suburban demographic. The company might not have tested a shoe program if the price weren’t right, but the low cost of inserts means marketers can prospect further out from their core business, LePera says.

While package inserts may be the most desirable insert medium, the universe is so small that “eventually you reach the wall — you’ve tried everything,” Roland says. She finds that catalog bind-ins and blow-ins are the next most effective insert media; they offer more volume than package inserts and also reach catalog shoppers, albeit not as qualified as those receiving an order. They go largely to the catalog’s house file, because blow-ins in prospecting catalogs require another set of approvals.

Among other types of alternate or insert media, co-op mailings have proved effective for packaged-goods companies and continuity programs with a strong offer. With postage, envelope, and label costs generally shared among participants, the cost of mailing is substantially lower than with a solo offer.

But because co-op programs tend to accept a greater number of inserts in their envelopes than most catalogers do in their package insert programs, it’s easier to get lost in the shuffle in a co-op. What’s more, the prospects are not as qualified.

Statement stuffers, such as ride-alongs in invoices for cable television or credit-card purchases, also can be effective, because most people open their bills. But because statements are sent first class, the marketplace is limited by size and weight restrictions.

In addition, not all companies will accept outside offers in their invoice envelopes, because they don’t want to distract customers from getting to the bill. They may be more lenient in second or third invoices, but those customers aren’t as qualified as the ones who open and pay their bills promptly.

What works best for you also depends on the products you’re marketing, Henry says. For instance, if you sell a targeted product line, such as baby equipment, co-ops may work well for you, because of the availability of specialized — in this case, baby-oriented — co-op mailings. A general-interest product, such as a vacuum, will probably perform better in package inserts.

Wilmette, IL-based Ann Meyer writes frequently on business topics for The Chicago Tribune, among other publications.

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