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Direct mail strategy & execution

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Presentation to the University of Minnesota College of Continuing Education

Presentation to the University of Minnesota College of Continuing Education

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  • The strategic plan gives rationale for your tactical decisions Key functional groups include Sales, Marketing, Operations, Supporting Vendors Measures are linked to the business objectives. They may include Revenue goals, Market share growth, Share of customer/wallet, Retention/Loyalty or ROI Effective messaging is a result of knowing current mindset of your target audience
  • From the marketing classic, “Positioning” by Ries and Trout. The concept of positioning changed the thinking about advertising and marketing communications from a saturation strategy to a whole new paradigm that recognized a new reality: the marketplace is overcrowded.
  • Source: Peter Sealey, author of Simplicity Marketing. Given the level of brand choices and commercial solicitations consumers are exposed to, it has never been more critical to understand their perceptions, their wants, and your positioning with them when developing your messages to them.
  • Remember Avis? For 13 years they lost money trying to compete directly with Hertz. Then they positioned themselves as number two: we try harder. They claimed the number two spot and began to profit. Y1: $1.2M Y2: $2.6M Y3: $5M Then Avis was bought by ITT who didn’t like the number two strategy. They began running ads saying, “Avis is going to be number 1.” Psychologically, it didn’t resonate with the intended audience. Strategically, it didn’t exploit any weakness in Hertz. And it bombed. Third place National began to gain their market share. Avis is fortunate to still hold number two today, if they realize it or not.
  • Resources for sizing markets: Standard Rate & Data Services (srds.com) has lists of subscribers to professional trade publications and associations nationwide. Dunn and Bradstreet business database. Government resources: Bureau of Labor & Statistics, Dept. of Commerce, Census Bureau (all online) List brokers. Profiling: purchasing behavior (RFM scoring); what do our existing customers look like? Seasonality? Who are the decision makers and influencers? What are their business problems? Demo/Psyco: Income, Home ownership, Children, Marital status, Hobbies, Political affiliations, Disposable income, Media perceptions and consuption
  • What is the cumulative media messaging hitting this target audience? What is your competition claiming? What position do they own? What’s their market share? How are they using the various media to reach the market?
  • Given your identified objectives, what are the best channels and means for driving consumer behaviors to meet those objectives? Rank the tactical priorities to achieve the specific objectives: Strategic – “big picture” strategy Financial – Revenue, ROI Marketing – behaviors you need to drive
  • Implementation details: the nitty-gritty of what you will do.
  • IDM: the precision deployment of direct mail, telemarketing, public relations, advertising and internet/email marketing tactics to deliver on your business objectives. Develop messaging through voice of customer research to determine media preference/usage for optimum results. DBM: recency, frequency, monetary value. The most fundamental way to evaluate customer value and behavior. Predictive modeling looks at current customers key purchasing variables to predict those most likely to respond to an offer or channel. Testing. Main rule for testing: one variable (as in A-B testing). See additional materials for testing models. Wunderman: what all successful direct marketing companies have learned about effective direct mail strategies.
  • The product must create value for each of its customers. It must satisfy their unique differences, not their commonalities. Your message must be as relevant to each consumer as the product or service is. The product and its communication stream must continue to provide both rational and irrational answers. Relationships continue to grow – encounters do not. Prospects are consumers who are able, ready and willing to buy; suspects are merely eligible to do so. Convert one-way communication to two-way information sharing.
  • Transcript

    • 1. STRATEGIC COMMUNICATIONS
    • 2. Direct Mail Strategy & ExecutionTopicsStrategic Applications for Direct MailStrategic PlanningStrategy ConsiderationsCreative Execution STRATEGIC COMMUNICATIONS
    • 3. When to use Direct Mail as a strategyTo produce an immediate and identifiable order or inquiryTo generate leads for field sales follow-upTo sell directly to prospects without using dealers or retailersTo reach a target audience other media cannot cost-effectively reachWhen a personal communication is desiredWhen precise timing or frequency of contact is essentialWhen a highly controlled distribution is requiredTo communicate detailed product informationTo build and refine mailing lists STRATEGIC COMMUNICATIONS
    • 4. When to use Direct Mail as a strategyTo follow-up on inquiries from other channels (Trade Shows, Web, promotions)To build long-term customer relationships from short-term salesTo test product potential, price, packagingTo determine prospect profilesWhen you need to show measurable ROI on your marketing spend STRATEGIC COMMUNICATIONS
    • 5. Direct Mail Planning“Plan your work,and work your plan” STRATEGIC COMMUNICATIONS
    • 6. Why write a Direct Mail Plan?Document your strategic frameworkInvolves key functional groups in the total strategyIdentify measures for successBrings focus to messaging and creative execution STRATEGIC COMMUNICATIONS
    • 7. Components of the Direct Mail PlanIntroductionProduct/Service AssessmentMarket PotentialMarketing EnvironmentStrategyImplementation Plan STRATEGIC COMMUNICATIONS
    • 8. IntroductionWho requested the plan?Who were the authors?What is the purpose for the plan?Summary of data for the planWhat desired data was not available? STRATEGIC COMMUNICATIONS
    • 9. Product/Service AssessmentPhysical characteristicsScientific or technical aspectsEmotional aspectsFeatures-Advantages-BenefitsPositioning: current mindset/perceptions toovercome STRATEGIC COMMUNICATIONS
    • 10. Product Assessment: exampleDescribe a pencil … STRATEGIC COMMUNICATIONS
    • 11. Product/Service AssessmentPhysical description It’s yellow There’s black lead inside a wooden tube There’s a point on one end There’s an eraser on the other end STRATEGIC COMMUNICATIONS
    • 12. Product/Service AssessmentTechnical description What kind of wood is used How is the lead made? Country of origin of the rubber eraser Manufacturing process Types of pencils offered by the manufacturer STRATEGIC COMMUNICATIONS
    • 13. Product/Service AssessmentScientific description How many times can it be sharpened? How many words per single pencil? How much longer will it perform vs. competition? STRATEGIC COMMUNICATIONS
    • 14. Product/Service AssessmentEmotional description Security of being able to erase mistakes Peace of mind knowing it won’t leak or smear Impress friends with your practicality, frugality STRATEGIC COMMUNICATIONS
    • 15. Product/Service AssessmentUltimate benefits Fame for writing a screen play Riches for writing a brilliant business plan Romance for writing a touching love sonnet STRATEGIC COMMUNICATIONS
    • 16. Positioning – an overviewDefined: “Positioning is not what you do to a product. It’s what you do to the mind of the prospect. You position the product in the mind of the prospect.” Seven-Up: the uncola Avis is #2 in car rentals: We try harder STRATEGIC COMMUNICATIONS
    • 17. Positioning – an overviewToday’s overcrowded marketplace …40,000 products in a supermarket52 versions of Crest toothpasteConsumers get an average 3,000 messages a dayOver 20 million telemarketing calls dailyAverage 150 pieces of mail per month STRATEGIC COMMUNICATIONS
    • 18. Positioning – an overviewHow do you take a positionowned by your competitor? YOU DON’T! STRATEGIC COMMUNICATIONS
    • 19. Positioning – an overviewPositioning in a nutshell: Reposition competitor by focusing on a category benefit not owned by them Create a new category in the marketplace Be first to get into the prospect’s mind with a category position STRATEGIC COMMUNICATIONS
    • 20. Market Potential Sizing the universe Customer/Prospect profile Demographic/Psychographic data Results of previous research or marketing efforts Changes in product, price or positioning needed to appeal to other markets STRATEGIC COMMUNICATIONS
    • 21. Marketing Environment Competitive situation analysis Competitive media use and messaging Media Options – integration opportunities Media cost, timing and testing factors SWOT STRATEGIC COMMUNICATIONS
    • 22. Marketing EnvironmentSWOT Analysis Model Review your core competencies and differentiators Strengths, Weaknesses: internal environment (operations, technology, product innovation, customer service, etc.) Opportunities, Threats: external environment (economy, government regulations, industry trends, technology, etc.) STRATEGIC COMMUNICATIONS
    • 23. Marketing EnvironmentSWOT Analysis ModelExternal Assessment: Who are our key customers, competitors, suppliers and other external stakeholders? What are their driving concerns? What opportunities/threats do these driving concerns pose?Internal Assessment – in light of external findings: What are the critical cross-functional processes in the organization? For each process, what are the strengths/ weaknesses? STRATEGIC COMMUNICATIONS
    • 24. Strategy Objectives: Strategic, Financial, Marketing Strategic options/alternatives & criteria for selecting them Recommended priorities for strategy and tactics STRATEGIC COMMUNICATIONS
    • 25. StrategyObjective Setting Guidelines Purpose: Characteristics:To define the intent, the  Specificmeans and the expected  Quantifiableresults of a strategy orinitiative  Time bound  Consistent with Company strategy  Business performance- oriented  Drives strategic decisions STRATEGIC COMMUNICATIONS
    • 26. StrategyObjective Setting Guidelines Establishing Specifics: Quantitative Measures: What sales  Share of market/wallet performance have we  New sales revenue achieved historically?  Upsell/Cross-sell revenue What is possible to  Retention rates/revenue achieve?  Profitability (ROI; marketing cost What are the corporate of sale) expectations? STRATEGIC COMMUNICATIONS
    • 27. Implementation Plan Campaign outline (tactics that support objectives) List: segmentation and target audience Creative concept and offer Budget Timeline Metrics STRATEGIC COMMUNICATIONS
    • 28. Review: Components of the DM PlanIntroductionProduct AssessmentMarket PotentialMarketing EnvironmentStrategyImplementation Plan STRATEGIC COMMUNICATIONS
    • 29. Strategy ConsiderationsIntegrated Direct MarketingAnalysis Tools Database Marketing (RFM & predictive modeling) TestingWunderman’s Commandments STRATEGIC COMMUNICATIONS
    • 30. Wunderman’s Commandments The consumer, not the product must be the hero Communicate with each customer/prospect as an audience of one Answer the question “Why should I?” Create relationships Suspects are not prospects Know and invest in each customer’s lifetime value Encourage interactive dialogues Share of loyal customer, not market share, creates profits STRATEGIC COMMUNICATIONS
    • 31. Three pillars of Direct Mail strategy The offer The list The creative execution STRATEGIC COMMUNICATIONS
    • 32. Last word on strategy: ExecutionA mediocre strategy withgreat execution alwaysbeats a great strategywith mediocre execution! STRATEGIC COMMUNICATIONS
    • 33. What you need to know about creativeDirect Mail FormatsPost CardsAdvantages: Cost effective Gets attention without opening an envelope Effective traffic builderDisadvantages: Limited space Not a sales driving device “Junk Mail” association STRATEGIC COMMUNICATIONS
    • 34. What you need to know about creativeDirect Mail FormatsSelf MailersAdvantages: Relatively inexpensive More profitable than envelope packages Effective for promoting seminars/publishing offersDisadvantages: Lower response than envelope packages “Junk Mail” association STRATEGIC COMMUNICATIONS
    • 35. What you need to know about creativeDirect Mail FormatsClassic Package (letter, brochure, reply card, envelope, lift note)Advantages: More personal More “selling” space Higher involvement & responseDisadvantages: More expensive More complex – more ways to go wrong STRATEGIC COMMUNICATIONS
    • 36. EnvelopesThe job of the envelope isto get opened – not to sell STRATEGIC COMMUNICATIONS
    • 37. EnvelopesHow consumers look at an envelope First, they look at their name Second, they read teaser copy Third, they look at the return address Forth, they look at the postage Last, they look at the back STRATEGIC COMMUNICATIONS
    • 38. EnvelopesTips for getting your envelope opened  Get the name right  Use the name in more than one place  Use high-impact, provocative teaser copy  Highlight the offer  Make your logo/corporate identity visible  Use a stamp vs. metered or indicia  Consider hand addressing  Add color  Use Fed Ex or Western Union  Faux Fed Ex  Consider dimensional package STRATEGIC COMMUNICATIONS
    • 39. The letter The job of the letter is to SELL STRATEGIC COMMUNICATIONS
    • 40. The letterHot spots on the letter  The Johnson Box/headline  The signature  The P.S.  The first sentence  Sub headlines  Hand written points  Bullet points  A second color STRATEGIC COMMUNICATIONS
    • 41. The letterTips for increasing involvement and response Start with the prospect, not the product Make the opening line short and compelling Tell a story Fire your biggest shot first – benefits Make it look like a letter, use typewriter font Focus on readability Use a Johnson Box or headline teaser Write to one person Personalize the letter and message Sell with emotional appeals Tell the reader what to do; ask for the offer Use a P.S. STRATEGIC COMMUNICATIONS
    • 42. The brochureThe job of the brochure is toinform. It provides the answerto the question, “Why should I?” STRATEGIC COMMUNICATIONS
    • 43. The brochureTechniques for higher impact Use numbers in headlines to add credibility Put captions under photos Use pictures of people to add a human touch Use charts to convey detailed information Include a Q & A section Include competitive comparisons Use testimonials or product reviews Use a quiz or test to involve the reader Always link product features to customer benefits Make it easy to understand at a glance Include a call to action and 800 number STRATEGIC COMMUNICATIONS
    • 44. The order form The order form must be able to stand alone, must be easy to use, and must contain all of these elements: The offer The terms/payment options The response options The benefits of what you’re selling The guarantee STRATEGIC COMMUNICATIONS
    • 45. The order formTechniques to increase response Use the customer’s voice Evoke good feelings about using the product Provide several ordering options Overcome skepticism with solid guarantee Put in a photo of the offer Personalize the order form/card Use the word “free” Drive greater involvement with:  Yes/No/Maybe check off box  Stickers  Brief questionnaire STRATEGIC COMMUNICATIONS
    • 46. The offerThe offer represents thetotal selling proposition thatattracts attention, buildsinterest and motivatesaction STRATEGIC COMMUNICATIONS
    • 47. The offerTips for success Make it relevant to your audience and product benefit Offer something they can’t get anywhere else Don’t sell the premium, sell the offer Give your customers the best deal Assign a dollar amount to the offer Put a deadline on the offer Offer a gift with inquiry, trial, order Offer price discounts on product bundles Offer information: research, idea kits, etc. Offer trade-in discount or rebate Offer a personalized gift/mystery gift STRATEGIC COMMUNICATIONS
    • 48. PresenterJohn G. Olson Principal, clarion|creative Past President, Midwest Direct Marketing Association B2B Marketing Consultant Copywriter & Content Marketer Blog: marketingawesomeness.wordpress.com Twitter: @John_G_Olson Email: john.olson7@comcast.net STRATEGIC COMMUNICATIONS

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