Target new clients with direct-mail lists: the direct-mail list can make or break your marketing campaign. Here’s how to find the best for your business – business corner
Do you know the most important element of a successful direct-mail campaign? It’s not the copy. It’s not the artwork. It’s not whether you send a newsletter, postcard or brochure. It’s the mailing list.
This is more true today than ever–with today’s technology, the availability of quality direct-mail lists has vastly improved. In the 1980s, trying to find a good direct-mail list outside of one’s own database was very difficult. Direct-mail lists had a bad reputation. Addresses were often inaccurate, and the data was suspect. There was no cost-effect way to compare names on multiple lists, so consumers were often pestered with duplicate mailings, which skewed tabulated results and wasted budgets.
Today, data can be sliced and diced at lightening speeds and updated just as quickly. Information is linked with other sources and finely sifted until you know as much, if not more, than the person’s best friend. As a consumer, that makes me uneasy, but as a marketer, I jump with joy.
Although the process is far from perfect, today’s specialized technology means consumers are more likely to receive advertising mail of interest to them. It also makes it possible for even the smallest business to create a market and compete successfully.
Having said this, I would like to emphasize that your best list is and will always be your internal database or “house” list of customers or prospects. According to American List Counsel, a mailing list manager and broker, your house list will typically bring double the response of an outside list. Yet, only 50 percent of business marketers surveyed use customer or prospect names for mailing purposes. Don’t make this same mistake. It’s where you should start before talking to anyone about buying a list.
Once you decide to buy a list, spend the time and effort up front to select the best one for your business. In direct mail, a mailing list is not just a way of reaching your market–it is the market.
Following are tips to help make your direct-mail experience a success. Keep in mind that the mailing piece should not be written or designed until the right lists have been selected. Until you complete all of your list parameters, you may not have the information needed to create a piece that will be as targeted as possible.
Clone Your Customers
Owen McCorry, senior vice president of new business development of American List Counsel, said, “We recommend that our clients try to done their best customers. If your best client is female, 35 to 45 years of age, married with three children and a household income of $50,000-plus, then we recommend using these attributes as the profile when searching for a mailing list.”
Use a List Broker
A list broker, like a travel agent, has a specialized knowledge of lists. He knows their profiles, quantities, costs, sources, etc. A broker will share this knowledge free of charge with the understanding that the client will order the lists through him. The broker earns a commission on this transaction, typically paid by the owner of the list. List users cannot obtain lower prices by ordering directly from list owners.
List brokers are easy to find. For example, in Chicago’s business-to-business Yellow Pages, I found about 100 such companies, and a quick Internet search yielded more than 80,000 worldwide.
I suggest interviewing several list brokers before making a decision. See how accessible they are–can you reach a “live” person by phone? Do they take the time to truly understand the consumer you are trying to reach? Ask for references. Cultivating a long-term relationship with a list broker can be a valuable use of time and marketing dollars.
Understand Different Types of Lists
There are two types of data sources available to direct-mail marketers: compiled lists and response lists. Each type has a set of unique characteristics that enables it to achieve specific objectives.
A compiled fist is data gathered from third-party public sources, such as government records, newspapers and directories. Compiled lists frequently include considerable demographic data. Response lists, on the other hand, are lists of individuals who have responded to a direct marketing offer. Lists of magazine subscribers, mail-order buyers, even free literature requesters are all response generated.
Using a compiled list is a good idea when your direct-mall objective is brand awareness, publicity or general information. It is also an appropriate option when you need to reach an entire market, such as every homeowner living in a specific Nashville suburb. Compiled lists also work well when you need to target a well-defined market, such as homeowners with household incomes over $50,000 who live within 10 miles of your store. In many cases, a response list cannot provide enough names for an adequate mailing when your geographic market is limited–a compiled list can.
Response-generated fists are really some other marketer’s customer names, which gives you the ability to further define your target consumer by buying habits or interests. And the more refined your list, the more targeted your mailing message can be.
Simply put, a homeowner in your area who recently subscribed to a home decorating magazine is a more likely target for custom framing than an apartment dweller who subscribes to an auto repair magazine. And a homeowner who has bought art in the past three to six months is even better. Response lists can be that specific.
Price Your Options
The vast majority of marketing lists are supplied on a one-time rental basis. This means that the owner allows the renter to use the list once in return for a fee, typically expressed on a per-thousand-record basis. You can also rent lists for multiple uses. For example, a list broker might double the base price but allow you to use the list three times.
Most list companies have minimums (usually 1,000 to 5,000 names), so ask up front. Also, the more filters you use, the more expensive the list. Additional costs are incurred as you add selections, such as income, age, length of residence, new movers, recent purchases, etc.
“Compiled lists are generally less expensive than response lists, costing between $30 and $60 per thousand versus $80 to $100 per thousand for response lists,” said McCorry.
Every mailing is a learning opportunity. By keeping track of results, you will be much better informed to make future marketing decisions. You want to know who responded, which respondents purchased and the value of their purchase. Again, technology comes to the rescue.
A simple spreadsheet can help track results so you can accurately calculate your return on investment, which should be significant if you did your homework and found the right list.
Lynn Fey has more than 17 years of marketing experience with a diverse range of products and services. She currently owns her own marketing consulting firm. InSight Solutions, which is based in Atlanta. She can be reached at firstname.lastname@example.org.
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