During hard economic times, prospecting is tougher than ever. But some mailers are finding ways to prospect effectively and still keep an eye on the bottom line.
A central problem today is finding prospecting files. In the consumer catalog business, “the lack of new names is our greatest problem right now,” said Linda Huntoon, executive vice president of Direct Media Inc.
“Every year I say, ‘Am I going to have enough prospects to meet my plan?'” said Mike O’Connor, president of business-to-business firm Abbott Co., who along with Huntoon spoke on a panel at the Direct Media Mailer Conference and Co-op in White Plains, NY, on Thursday.
One way mailers meet this challenge is to focus on retention techniques.
Nicola Zelle, circulation manager of Newsweek Budget Travel, recommended “mailing deeper into your best-performing lists.” Get rid of non-performing names, she said. (Newsweek Budget Travel is published by Primedia, a division of which publishes Direct Newsline.)
When she started her job as director of development at North Shore Animal League a year ago, Lisa Wilson took a long, hard look at how well her donor lists were performing.
The nonprofit had been a huge sweepstakes mailer — with a 16-million-record file of sweeps donors. But only 800,000 had been responding. She decided to cull out the poor responders, while migrating sweeps responders over to loyal donors who gave without the incentive of a sweepstakes. She built a regression model to map which donors were the most responsive over time and promoted to them.
“I had to determine how much I was willing to spend on each file to benefit the company over the long term,” Wilson said.
Focus on the best customers, said O’Connor, reflecting on Abbott’s 60,000-name house file of active buyers. “You can’t mail to them enough,” he said, noting it’s important to keep presenting these best customers new offers. Ramp up telemarketing, along with direct mail to best customers, too, he added.
Another way to meet the prospecting challenge is to “test, test, test,” O’Connor said. One Abbott Co. test, which segmented specific industries such as the housing sector, and mailed to them in a targeted fashion, delivered a 30% lift in response.
Exchanging lists is a solid cost-saving method, the panelists agreed. North Shore Animal League has been able to hold down list rental costs by relying on exchanges with other mailers.
When you can’t exchange, seek out special pricing on the base price or selects, the speakers said. O’Connor has a special pricing relationship with mailers whose list Abbott Co. mails frequently. “This helps us to keep down the price, so it’s not going up $10 per thousand every year,” he said.
The No. 1 way to save on prospecting? “The Internet,” Huntoon said, “is the biggest benefit out there.”
North Shore inserted a place to fill in an e-mail address on a mailing reply device and collected 50,000 e-mail addresses this year.
Plus, by placing a link to click through and donate on its free e-mail newsletters, North Shore’s online donations spiked from about $60,000 last year to $250,000 this year.
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