Seeking Customer “Engagement” in 2010 Brings Back Old Memories
Published: October 14, 2009
Since the inception of the recession, many companies and non-profit organizations have reduced their prospecting efforts, increased customer reactivation initiatives, and re-allocated strained budgets in favor of pay-per-click, social networking, and other forms of online advertising. Others have sheepishly chosen the time-honored path to a quick and untimely demise: namely, relying on house files for sustenance.
What’s the story with direct mail? It’s not on everyone’s radar, which is why it should be in your budget next year.
If you are a fan of online marketing, it’s hard to be nostalgic when you believe the web is the best way to seek “engagement” with new and old customers. While it is undeniable that certain forms of online advertising and social networking are effective, particularly for customer relationship management, the jury returned a unanimous verdict long ago relative to the marketing channel that generates the most loyal customers and donors. If you believe it is e-mail, you are wrong. What about Twitter? It’s the same story! How about text messaging? No way. Have you given up guessing the winner?
Well, direct mail maintains an unrivaled advantage when it comes to engagement. The most loyal customers are generated from solo direct mail. That’s a fact. Of course, it must be said that if we know someone is both responsive to postal mail and makes their purchases online, they represent “the crème de la crème.” These elite buyers are coveted by experienced direct marketers.
If you plan to cut back on direct mail because you think it’s too expensive and response rates are going down, I have some welcome and surprising news as you finalize your marketing plans for 2010. The USPS actually cut its postage rates for certain classes of mailers twice this year. Response rates for some offers are pretty good, even in what is said to be “the worst economic slowdown since the Great Depression.” If you don’t believe me, check your mailbox and see who is mailing with confidence.
When you think about it, there’s a lot less mail being delivered today versus a year ago. That works to your advantage as a direct marketer, because there is less competition in the mail stream. In other words, less is more because as your competitors’ scale back their prospecting efforts, that creates new opportunities for you to cost-effectively engage customers, who are not currently being targeted through the mail. As is traditional, it helps to have a relevant, timely, and well-priced mail offer that exudes value.
Meanwhile, response rates for online banners and skyscrapers are going down. Other forms of online advertising are also taking a bath. Even pay-per-click advertising doesn’t work as well as it did a few years ago. Have you heard of “click fraud?” It hasn’t gone away. Click rates are down, too.
Text messaging, aka mobile or SMS, is very popular right now. However, as was the case with e-mail, high response rates associated with “new media” will be supplanted with shrinking results, as more mobile phone owners resort to blocking unsolicited text messages, which is inevitable. Once internet-enabled phone owners are aware that they are running bare, they will resort to countermeasures like SPAM filters and ISP blocks, just like e-mail, so you will actually have less online engagement in the future, not more.
Government regulation also may put the online genie back in the bottle next year. Congress is considering restrictive online privacy legislation as we go to press.
Even if the economy were strong today, experienced marketers would continue to test new media to see if it rivals traditional media such as direct mail and insert media. That’s a good thing because direct marketing, regardless of channel, is measurable to the penny.
But mark my words, targeting via postal mail will ascend by the end of next year. This will happen because it has a long history of success in good and bad times. Of course, if postage rates skyrocket along with paper, all bets are off.
When advertisers recognize that direct mail is still affordable and delivers a predictable return on investment, they will not forsake it, again. Plus, when you integrate well-executed postal with certain forms of online marketing, you can optimize results so that 1 + 1 = 3. Please keep that in mind as you finalize your e-mail and postal mail plans for 2010 and beyond.
David Kanter is the President and CEO of Ventura, CA based www.acculistusa.com.
AccuList USA® provides a broad spectrum of services to direct marketers and their agencies including consulting, list brokerage, list management, list enhancement, merge-purge, response analysis, campaign planning, graphic design, copywriting, printing, mailing, and predictive modeling services.
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