Test, Test, Test  for Successful Direct Marketing <ul><li>Michael Sexauer </li></ul><ul><li>Director of Marketing and Memb...
Parks Conservancy Mission <ul><li>To improve quality of life for the people of Pittsburgh by restoring the park system to ...
Parks Conservancy Projects <ul><li>Ten major capital projects completed since 1996. </li></ul><ul><li>Over $45 million rai...
 
 
 
 
Parks Conservancy Members <ul><li>Over 4,500 active members. </li></ul><ul><li>Household profiles index* very high: </li><...
Why do we… <ul><li>have a marketing plan? </li></ul><ul><ul><li>To make money </li></ul></ul><ul><li>use direct mail? </li...
Direct Marketing Efforts <ul><li>Newsletter four times per year. </li></ul><ul><li>Monthly membership renewals. </li></ul>...
Direct Marketing Numbers <ul><li>Last year the Parks Conservancy: </li></ul><ul><ul><li>Mailed 94,789 ‘ask’ pieces </li></...
Which one matters most? <ul><li>Mailed 94,789 pieces </li></ul><ul><li>Spent  $ 45,702 </li></ul><ul><li>Grossed $ 183,504...
Before you test, benchmark <ul><li>Report results that makes sense to your audience (or show all of them). </li></ul><ul><...
Sample Metrics
Return on Investment (ROI) <ul><li>(Gross Rev. – Expenses) </li></ul><ul><li>Expenses </li></ul><ul><li>CAUTION: Account f...
Cost Per Dollar Raised (CP$R) <ul><li>Total Expenses </li></ul><ul><li>Gross Revenue </li></ul><ul><li>How efficiently are...
What variable(s) to test.
Guesses?
Which variable to test? <ul><li>Audience </li></ul><ul><li>Channel </li></ul><ul><li>Creative </li></ul><ul><li>Media </li...
Which variable to test first? <ul><li>Creative </li></ul><ul><li>Offer </li></ul><ul><li>Media </li></ul><ul><li>Timing </...
The Money Slide
Focus on profit drivers to maximize ROI.
Where to put your energy. <ul><li>Big Movers </li></ul><ul><ul><li>Audience 20:1 </li></ul></ul><ul><ul><li>Offer 10:1 </l...
Multivariate Examples <ul><li>Test multiple things at the same time by creating cells that hold other items, like list, co...
Lessons Learned <ul><li>Employ a champion/challenger model </li></ul><ul><li>Be sure to keep track of your efforts—institu...
Apply to other channels <ul><li>Other DM methods should be tested. </li></ul><ul><li>According to the DMA Factbook 2010: <...
Fun Facts from the DMA <ul><li>Average consumer receives 24.7 pieces of direct mail weekly. </li></ul><ul><li>Postcards ar...
More Fun Facts from the DMA <ul><li>In 2008, over half of all standard mail sent to seniors contained a request for a dona...
Michael Sexauer Director of Marketing 412-682-7275 x222 [email_address]
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Marketing and Visitor Services Mini Series: The Three Most Important Words in Direct Marketing: Test, Test. Test!

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Marketing and Visitor Services Mini Series: The Three Most Important Words in Direct Marketing: Test, Test. Test!

  1. 1. Test, Test, Test for Successful Direct Marketing <ul><li>Michael Sexauer </li></ul><ul><li>Director of Marketing and Membership Development </li></ul><ul><li>Pittsburgh Parks Conservancy </li></ul>
  2. 2. Parks Conservancy Mission <ul><li>To improve quality of life for the people of Pittsburgh by restoring the park system to excellence in partnership with the City. </li></ul><ul><li>Founded December 1996 </li></ul>
  3. 3. Parks Conservancy Projects <ul><li>Ten major capital projects completed since 1996. </li></ul><ul><li>Over $45 million raised and invested in the parks system. </li></ul><ul><ul><li>Four major parks including 1,700 acres in the City. </li></ul></ul><ul><ul><li>167 other parks and ‘parklets’ </li></ul></ul><ul><li>$10 million annual operating budget. </li></ul>
  4. 8. Parks Conservancy Members <ul><li>Over 4,500 active members. </li></ul><ul><li>Household profiles index* very high: </li></ul><ul><ul><li>Head of household 35-54 (185 index) </li></ul></ul><ul><ul><li>Families with children (334 index) </li></ul></ul><ul><ul><li>College grads and advanced degrees (475 index) </li></ul></ul><ul><ul><li>Employed professionals (453 index) </li></ul></ul><ul><li>*An index of 100 is average compared </li></ul><ul><li>to the Pittsburgh market. Source: Claritas. </li></ul>
  5. 9. Why do we… <ul><li>have a marketing plan? </li></ul><ul><ul><li>To make money </li></ul></ul><ul><li>use direct mail? </li></ul><ul><ul><li>To make money </li></ul></ul><ul><li>test our direct mail programs? </li></ul><ul><ul><li>To make MORE money </li></ul></ul>
  6. 10. Direct Marketing Efforts <ul><li>Newsletter four times per year. </li></ul><ul><li>Monthly membership renewals. </li></ul><ul><li>Quarterly reactivation mailings. </li></ul><ul><li>Two acquisition mailings annually </li></ul><ul><ul><li>Share lists through a third party with other institutions. </li></ul></ul><ul><ul><li>Want to break even on these. </li></ul></ul>
  7. 11. Direct Marketing Numbers <ul><li>Last year the Parks Conservancy: </li></ul><ul><ul><li>Mailed 94,789 ‘ask’ pieces </li></ul></ul><ul><ul><li>Spent $ 45,702 </li></ul></ul><ul><ul><li>Grossed $ 183,504 </li></ul></ul><ul><ul><li>Averaged 2.9% response rate </li></ul></ul><ul><ul><li>Achieved a 302% Return on Investment </li></ul></ul><ul><ul><li>Raised $1 for every $0.25 spent </li></ul></ul>
  8. 12. Which one matters most? <ul><li>Mailed 94,789 pieces </li></ul><ul><li>Spent $ 45,702 </li></ul><ul><li>Grossed $ 183,504 </li></ul><ul><li>2.9% response rate </li></ul><ul><li>301% Return on Investment </li></ul><ul><li>Raised $1.00 for every $0.25 spent </li></ul>
  9. 13. Before you test, benchmark <ul><li>Report results that makes sense to your audience (or show all of them). </li></ul><ul><ul><li>Response rate by itself is useless as is gross revenue and average gift. </li></ul></ul><ul><ul><li>ROI is cherished by C-level execs and board members but not understood by all. </li></ul></ul><ul><ul><li>The cost to earn a dollar resonates with almost anyone. </li></ul></ul><ul><li>Above all, report what you learned and changes over time. </li></ul>
  10. 14. Sample Metrics
  11. 15. Return on Investment (ROI) <ul><li>(Gross Rev. – Expenses) </li></ul><ul><li>Expenses </li></ul><ul><li>CAUTION: Account for all expenses! </li></ul><ul><ul><li>If you are acquiring a new member, will you include the cost to service the membership. </li></ul></ul><ul><ul><ul><li>Newsletters, card mailing, invitations, etc. </li></ul></ul></ul>
  12. 16. Cost Per Dollar Raised (CP$R) <ul><li>Total Expenses </li></ul><ul><li>Gross Revenue </li></ul><ul><li>How efficiently are you raising money? </li></ul><ul><ul><li>The closer to $0.00 the better </li></ul></ul><ul><ul><li>Close to $1.00 or over it may be hard to explain. </li></ul></ul><ul><ul><ul><li>Acquisition efforts are a good example. </li></ul></ul></ul>
  13. 17. What variable(s) to test.
  14. 18. Guesses?
  15. 19. Which variable to test? <ul><li>Audience </li></ul><ul><li>Channel </li></ul><ul><li>Creative </li></ul><ul><li>Media </li></ul><ul><li>Message </li></ul><ul><li>Offer </li></ul><ul><li>Timing </li></ul>
  16. 20. Which variable to test first? <ul><li>Creative </li></ul><ul><li>Offer </li></ul><ul><li>Media </li></ul><ul><li>Timing </li></ul><ul><li>Audience </li></ul><ul><li>Channel </li></ul><ul><li>Message </li></ul>
  17. 21. The Money Slide
  18. 22. Focus on profit drivers to maximize ROI.
  19. 23. Where to put your energy. <ul><li>Big Movers </li></ul><ul><ul><li>Audience 20:1 </li></ul></ul><ul><ul><li>Offer 10:1 </li></ul></ul><ul><li>Incremental </li></ul><ul><ul><li>Media 6:1 </li></ul></ul><ul><ul><li>Timing 5:1 </li></ul></ul><ul><ul><li>Channel 3:1 </li></ul></ul><ul><ul><li>Message 3:1 </li></ul></ul><ul><ul><li>Creative 2:1 </li></ul></ul>
  20. 24. Multivariate Examples <ul><li>Test multiple things at the same time by creating cells that hold other items, like list, constant: </li></ul><ul><ul><li>Outer envelope creative </li></ul></ul><ul><ul><li>Return envelope creative </li></ul></ul><ul><ul><li>Reply device </li></ul></ul><ul><ul><li>Outgoing postage treatment </li></ul></ul><ul><ul><li>Combine e-mail and mail </li></ul></ul>
  21. 25. Lessons Learned <ul><li>Employ a champion/challenger model </li></ul><ul><li>Be sure to keep track of your efforts—institutionalize the knowledge </li></ul><ul><li>Bad tests can be worse than no tests </li></ul><ul><ul><li>Don’t retest the same thing </li></ul></ul><ul><ul><li>Be sure to include all costs </li></ul></ul><ul><ul><li>Test accurately </li></ul></ul><ul><ul><li>Don’t assume you don’t need to test </li></ul></ul>
  22. 26. Apply to other channels <ul><li>Other DM methods should be tested. </li></ul><ul><li>According to the DMA Factbook 2010: </li></ul><ul><ul><li>49% of marketers using e-mail found open rates highest when sent between 10am and 2pm </li></ul></ul><ul><ul><ul><li>The Parks Conservancy found that Tuesday to Thursday between 11 and 12 is best </li></ul></ul></ul><ul><ul><li>Emails with subject lines with fewer than 35 words have higher open rates </li></ul></ul><ul><ul><ul><li>We test all sorts of things. </li></ul></ul></ul>
  23. 27. Fun Facts from the DMA <ul><li>Average consumer receives 24.7 pieces of direct mail weekly. </li></ul><ul><li>Postcards are most likely to be read </li></ul><ul><ul><li>42% for letters and 56% for postcards in the non-profit category. </li></ul></ul><ul><li>Direct mail advertising accounts for 52% of all mail volume in the US </li></ul><ul><ul><li>(and keeps first class postage from skyrocketing) </li></ul></ul>
  24. 28. More Fun Facts from the DMA <ul><li>In 2008, over half of all standard mail sent to seniors contained a request for a donation. </li></ul><ul><li>A courtesy reply envelope pulls better than a business reply envelope. </li></ul>
  25. 29. Michael Sexauer Director of Marketing 412-682-7275 x222 [email_address]

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