Nine Ways to Boost Mail Prospecting Results

Nine Ways to Boost Mail Prospecting Results
By Ann Meyer

Most of the country’s 111 million Americans are available on at least one of the lists or databases available for rent or exchange, says Bill Singleton, president of Singleton Marketing, a consultancy in Algonquin, IL. “But no one can afford to mail to 111 million households repeatedly,” he points out. The trick is to home in on those most likely to shop from your company.

Among the ways to do that via mail:

1) Take advantage of catalog co-ops. The five major consumer cooperative databases — Abacus (Broomfield, CO), I-Behavior (Harrison, NY), NextAction (Westminster, CO), Prefer Network (New York), and Experian’s Z-24 (Broomfield, CO) — have come on strong by offering names and data at prices as low as $55/M-$70/M.

Each co-op offers features that the others don’t. For instance, Sigme Thompson, director of marketing at video and DVD mailer Acorn, likes Prefer Network’s add-a-name feature, which adds a 10th name to bring a mail group to the carrier route level, allowing you to obtain postage discounts. The names tend to perform well because they’re added in neighborhoods you’re already targeting, Thompson says

Because results and features can vary considerably from one co-op to the next, most catalogers now use more than one co-op, notes Doug Platt, chief executive at Prefer Network, a unit of CMS Direct. “What’s mission critical for prospecting is coming up with more names that work, and that comes from the modeling methodology.”

But even co-op professionals say that list rentals and exchanges are an important part of the prospecting process. “There are always going to be some good lists to rent,” says Sally McMahon, managing vice president of cooperative databases at Experian. “A co-op database wouldn’t replace an entire circulation.”

2) Score with models. Singleton recommends scoring your own customer file by identifying customers in the top 20% within a segment. You can sort customers from high to low in average sales, using recency, frequency, and monetary value (RFM). Then enhance those names with data from a larger database, and use that information to look for similar prospects. “When I do a side-by-side comparison, RFM is not outdone,” Singleton says.

Using a similar approach, the cooperative databases also can be useful in assessing when to start mailing less to certain customers and look more to prospects. “We can tell you what your market share is through the co-op,” says Prefer Network’s Platt. “If you have 20% market share in fishing but 80% share of wallet in fishing rods, you may not be able to sell more fishing rods to your existing customers.”

3) Invest in data enhancements. The amount of enhancement data available continues to grow. The cooperative databases offer distinct enhancements, as do data compilers such as Acxiom, InfoUSA, ESRI Business Information Solutions, and Dun and Bradstreet.

Using enhancements such as demographic information and lifestyle data can help you find viable prospects outside the current catalog universe. “Most good prospects will show up with merge/purge against other good catalog list sources,” Singleton says. “But the competition is doing that as well. So [you need to look at] what else can you do.”

For example, Acxiom offers Personicx, a household-level segmented database that focuses on lifestyle behaviors. Claritas offers a geodemographics tool that segments customers based on demographics and behavioral traits. A geodemographics approach allows you to look by zip code for prospects with similar demographics or other traits, regardless of whether they’ve shopped by catalog before. If your offer is effective in converting them, you may find customers that no other catalogers have, Singleton says.

4) Learn from a promotional history file. Nabbing a new customer often takes repeated efforts. For that reason, Singleton advises creating a file tracking all mailings for the past two or three years and using it to determine the average number of mailings required for conversion.

Say you’ve determined that it takes five mailings on average to convert a prospect into a buyer. You can then tell your service bureau not to mail to a given household more than five times. “If a prospect comes up again and it’s the sixth time, you don’t mail to them. You replace it with another name,” Singleton says.

5) Master match-backs. “Most catalogers are doing an inadequate job of allocating Internet activity back to the catalog that drove the customer to the Web,” says Bill LaPierre, vice president of catalog brokerage at Millard Group, a list services firm in Peterborough, NH. “They’re spending all this money to develop very detailed circulation plans and to create and mail nice books, but there’s this disconnect tying it back. Catalogers in many cases are flying blind – they don’t have the right information.”

Often multichannel merchants have an inkling their print books are driving online sales, because they’ll get a lift shortly after a catalog drops in the mail. But that anecdotal evidence doesn’t shed much light on the way an individual prefers to shop–information that can be valuable when gauging how well a program worked as well as for planning future programs.

What’s more, you won’t be able to adequately measure list rental results if you don’t match back Internet orders to the catalog. Offering incentives to encourage online customers to input catalog source codes when applicable and investing in specialized software are just two ways to get a better handle on what percentage of non-call center/mail-in orders are driven by your catalog mailings. If you don’t have an accurate way of matching back the catalog to an online sale, don’t rent a list with a heavy preponderance of Internet activity, LaPierre says, because it will appear that’s it’s not performing well.

6) Look for niches hiding within larger lists. Don’t assume that a general merchant’s million-name list is too broad to be an effective source of customers for your specialized offer. Mokrynskidirect’s Matika suggests testing several lists that have at least 500,000 12-month names. Using analytics, pull out 50,000 names that best fit your customers’ characteristics and add these to your prospect file.

7) Make the most of your merge/purge. A clean list is the foundation of any prospecting program. “Getting the merge/purge right for the existing customers sets up some other good techniques,” Singleton says. As you move forward with a new list, merge/purge “lets you know they truly are prospects rather than duplicates you’re mailing to your own customers.”

The results can be substantially different. From a cost standpoint, you’ll save by mailing only to “true new net” prospects, Singleton says.

8) Reinvigorate with reactivations. Just because someone hasn’t purchased from you recently doesn’t mean he won’t ever buy from you again. Reaching back into your house file for customers from two, three, or four years ago can be a cost-effective way to prospect. To boost your odds of hitting those most likely to buy, Singleton suggests enhancing your files with transactional, attitudinal, and lifestyle data. Run all of your old names through an enhancement, and you’ll find many will still be at the same address purchasing from someone else.

Further, by using regression analysis, you can identify the hottest prospects and mail to them more frequently, while mailing to those at the bottom deciles less frequently, perhaps only around the holidays.

9) Bolster your offering. The best circulation strategy in the world can’t compensate for a weak catalog. “Prospecting is important, but fundamentally you have to make sure you have a good brand, a good offer, good creative, and good products,” says Chris McDonald, executive vice president/general manager of Abacus.

LaPierre goes so far as to blame the declining number of new 12-month buyer names in part on a lack of new catalog merchandise. “Most catalogers today don’t have a strong enough book to be competing in this marketplace. Many are still limping along with the same product they had in the book four and five years ago,” he says.

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