Four R’s of Direct Marketing:
Direct marketing works for companies large and small. It works for B2B and B2C. It works for email, direct mail, telemarketing, infomercials and more. According to the Direct Marketing Association, in 2009, each dollar of direct marketing expense provided an average of $11.73 in return on investment. Depending on a company’s resources, expertise and embracement of direct marketing, campaign design, execution and analysis can range from very simple to extremely sophisticated – or just about anywhere in between.
I’d like to share the practical direct marketing tips show below that I believe apply to all direct marketing campaigns, regardless of your level of expertise.
1. Right Audience
By far the most important part of any direct marketing effort is to use a list that targets the right audience. The enclosed diagram implies that reaching the right audience is more important than the message, timing and creative combined.
I can’t overemphasize the importance of the database you use. If your business is selling pallets of widgets to retail stores, then your database should consist of widget buyers for retail stores. No matter how good your deal is or how frequently you send it or how beautiful it looks, your money would be wasted if your message is sent to people who are not stakeholders for buying widgets.
2. Right Message / Offer
Next in importance for your direct marketing to be effective is the message/offer. The message/offer should have a clear call to action and provide a way to measure response.
Your call to action should also be prominent, straightforward and easy for the recipient to understand exactly what you want them to do. Examples include “call today, mention this ad and get 10% off your order” or “free shipping: simply visit our website and enter coupon code 1234 at checkout”. Tracking response allows campaigns to be measured and compared. Common measurements include cost per lead, sales per name mailed and return on investment.
I also know of two schools of thoughts on messaging. One is ‘Copy Sells’ – think of the very successful Publishers Clearing House mailings with multiple pages of detailed copy that require extensive recipient engagement. The other is KISS, or Keep It Simple – think Ray Kroc, the founder of McDonald’s global restaurant empire. Neither is more ‘right’ than the other, however for the vast majority of my experience, I’ve leaned toward the KISS side for writing copy.
3. Right Timing
I find timing to be a difficult topic for generalizations. Certainly it makes sense for your message to reach your audience at the right time to influence their actions – promoting down jackets in July may be challenging (or brilliant).
Throughout my career, I’ve also heard ‘experts’ say that it takes at least three impressions for someone to remember a marketing message. I don’t necessarily buy into it. In my experience, I have received tremendous responses from single targeted messages, such as new product announcements and store openings. I’ve also had sales reps tell me of receiving phone calls from elusive prospects after sending a series of monthly postcard mailings (even saying the prospect had saved the postcards in their desk drawers).
Further still, in my big-box retailing days, direct mail showed up on brand awareness research studies as a significant source for customers’ brand recall. While not a primary reason to do direct mail, the ‘halo effect’ for branding was very real – and at a disproportionately small fraction of what we were spending on TV, radio, print and free standing newspaper inserts. This research supported our integrated marketing approach and confirmed our message was reaching our target audience. So, what does this all mean? Well, timing matters; frequency matters, and there may be a halo effect on branding from direct marketing campaigns.
So, what do you do? When in doubt, I go back to basics. See the test and measure section below.
4. Right Creative
Like the right timing, I find it difficult to generalize about the right creative. For me, direct marketing creative and media go together. To determine if email, direct mail, telemarketing or any combination of the three is right, I go back to basics. See test and measure section below.
Important to Test, Measure and Learn
Every direct marketing campaign is an opportunity to test and learn – and then apply what you have learned to make the next campaign even better.
For planning direct mail campaigns, I follow these steps.
- Step 1. Establish strategy and goals and plan tactics accordingly
- Step 2. Setup campaign tactics to meet/exceed those goals
- Step 3. Execute campaigns
- Step 4. Analyze results and apply what you have learned, repeat Steps 1-4.
To test, measure and learn from direct marketing campaign, I use the Four R’s for direct marketing as a guide.
- Audience. Segment by profile &/or behavior. Learn how different segments respond
- Messaging/offers. Vary calls to action and learn the cost/benefit and ROI of each
- Timing. Test different lead dates and frequencies for pre/post events, purchases or announcements. Measure and compare campaign performance
- Creative. Test different media. Different media provides a different customer engagement, be it email, direct mail or telemarketing or any combination
Whether you have resources for predictive scoring, regression modeling or multivariate data sets or you just want to send a promotional letter to your customer list, I believe these basic tips can be applied to any campaign. I use them to keep my focus. I hope you find them useful as well.