Setting the Scene for Prospecting
By Ann Meyer
Most catalogers’ prospecting plans traditionally focused on the catalog itself. New media and changes in shopping habits and preferences, however, are leading marketers to rewrite their prospecting scripts. But that doesn’t mean rewriting mail prospecting out altogether.
The universe of 12-month mail order buyer names available for rent declined 5% in 2004 from the prior year, says Sandy Matika, senior vice president at Mokrynskidirect, a list and marketing services firm in Hackensack, NJ. To compensate, marketers are reinvestigating space ads, insert media, direct TV, and outbound telemarketing in addition to e-mail, affiliate marketing, and other Web-based vehicles.
“Every contact point represents an acquisition opportunity,” says Tom Collinger, an associate professor of integrated marketing communications at Northwestern University in Evanston, IL. Catalogers should be “looking at all media and all touchpoints for what’s the appropriate mix.”
Determining exactly what is an appropriate mix of media is easier said than done, of course. Analyzing what works most effectively can be a challenge, particularly when customers may be using several channels to browse and shop. “For such a long time catalogers enjoyed being able to track” response based on catalog source codes, says Karen Crist, senior vice president of sales and marketing at NextAction, a cooperative database based in Westminster, CO. “Now they don’t have the absolute quantity of data any more that says, ‘This drove it.’ And that kind of bugs them.”
The complexity of gauging the effectiveness of multiple media leads many marketers to rely on previous successes when developing prospecting strategies. But in a changing market, that can be a mistake. “Sometimes the problem is you had one niche and it worked,” says Susan Kalb, director of operations at Van Dykes Restorers, a marketer of furniture restoration supplies based in Woonsocket, SD. “So you would rather rest on your laurels than work to find something new. It gets tougher after you’ve been doing it for a while, but you’ve got to think of new ways.”
“You have to be very strategic,” notes Ed Whitehead, chief marketing officer at Dodgeville, WI-based apparel and home goods merchant Lands’ End. “Look at your pool of financial resources, and then look at how customers are shopping and how they respond. Put it all in the pot and stir it up.”
And when stirring the pot, don’t expect the same results from each channel, Whitehead says, or you might end up giving some viable options short shrift. “You won’t get the same results with national advertising as you will with a small direct approach. You can’t measure them exactly the same way.”
Similarly, not all customers are equal, says Collinger. When determining your prospecting strategy, consider what it costs to acquire a valuable customer, not just any customer.
“Lifetime value should be driving the customer acquisition process,” says Steve Trollinger, senior vice president of client marketing at Shawnee Mission, KS-based direct marketing agency J. Schmid & Associates. Another metric is contribution per order: Look at how many dollars of contribution to profit the customer provided.
Both metrics require tracking the purchase back to the originating medium, though, which brings us back to the travails of tracking in a multichannel environment. “We would like to think we’re getting new customers, but we haven’t had the resources to do a match-back to really know for sure,” says Deb Dyer, marketing director at Cuddledown, a direct marketer of bedding and home furnishings.
The Portland, ME-based cataloger does know that 45% of its online sales come through with a catalog source code. “As far as the other 55%, some might be new customers, or they might be ones who had catalog but didn’t put the source code in,” Dyer says.
Which brings to mind another point: Many multichannel merchants are finding that print catalogs are the best vehicle for driving traffic to their Websites. “We’ve tested cutting back on the catalog and using other means including e-mail campaigns and postcards to try to drive business, and we find nothing as of yet can replace the power of the catalog,” says Polly Hodson, circulation manager at Hanna Andersson, a children’s apparel cataloger/retailer based in Portland, OR. So while the catalog may not be the sole star of your prospecting campaign, it clearly should retain an important role in your marketing strategy.
– Nine Ways to Boost Mail Prospecting Results