7 Tips for Targeting Customers
During a session on how best to blend housefile and prospect mailing strategies for optimal results held at last week’s Annual Conference for Catalog & Multichannel Merchants in Kissimmee, Fla., catalog mailers Melissa Watson, director of catalog and e-mail marketing for food marketer Harry & David, and Ronda Anderson, marketing manager of American Time and Signal Co., a B-to-B cataloger of master and wireless clock systems, offered pointers on measurement, segmentation, results scrutiny and mailing timing, among others. Below are takeaways from the session.
1. Measure everything. Measure campaigns, Watson said, by capturing the source of orders and conducting matchbacks. Order sources can be captured through customer and catalog numbers, unique toll-free numbers, unique URLs/landing pages and product numbers.
2. Segment your mailings based on buying patterns, Anderson said. Segments within the B-to-B market include facility type (school, church, hospital, nursing home), SIC codes, number of employees and for-profit vs. not-for-profit. In the B-to-B environment, the number of employees and the size of the facility are generally your more important demographics.
3. Examine results as a whole. Harry & David reviews product mix, pricing, delivery charges, creative and marketing offers, among others. Factor in numerous variables, and ask questions, Watson said, when looking at these individual categories:
* product mix — Was there more of one particular price point or increased exposure to a particular product?
* pricing — Was there a strategic price increase/decrease in the book?
* delivery charges — With the rising cost of fuel, how much response was driven by a promotion of free delivery?
* creative — In the case of Harry & David, did the photography make the products look edible?
* marketing offers — What promotions were used to drive response?
4. Determine the right time to mail your catalogs. In B-to-B, Anderson advised that it’s critical to know when your customers/prospects receive their budgets. “Be on the top of mind when they have their money,” she said. Also know when they’re required to use up their budgets. This is especially relevant for school districts, Anderson noted, which in a number of circumstances are under a use-it-or-lose-it policy. In this case, mail six weeks prior, allowing time for your customers to process purchase order requests.
5. Build a pro forma for future mailings. Base future campaigns on past results, economic conditions (how current economic conditions will impact your business) and changes to your marketing/merchandising mix (if you increase prices, how much are you forecasting your average order value to go up?), Watson advised. Other marketing factors to consider:
* the number of pages in your catalog — Do you cut or add?
* product assortment — widen or narrow your scope?
* calendar shifts — When do Easter, Mother’s Day fall? How long is the gap between Thanksgiving and Christmas?
* paper and postage increases — What paper do you use? Can this be downgraded with minimal effect on your book? How has this year’s postal increase (3.5 percent to 5 percent for most catalogers) impacted your circulation plans?
6. Stick to a budget. Determine how much you’re able to spend to get a prospect as a customer, Anderson said. With names on your housefile, look at average order size and lifetime value. With prospects, determine cost of acquisition (sales results for one year of prospecting minus costs of goods and promotions divided by the number of new customers within that year) and average order size compared to housefile.
7. To co-op or not? When deciding whether or not to use the co-op databases for prospecting, determine if you’ll get out of them what you give up, Watson cautioned. “If you mail 2 million to 3 million names annually, and you’re only taking 100,000 names from the co-op, it’s not worth it,” she said. Prospect to a level that justifies your housefile exposure. Also consider which data is more valuable to your business — SKU level or transactional?
Referring to mail-order food buyers as an example, Watson pointed out: “The more niche business you are, the more important the SKU level data is.”