Get a Little Bounce From Bouncebacks
Bounceback programs are often limited to inserting a copy of your most recent catalog — preferably with a different cover — into the fulfillment box. But as shipping rates, fuel surcharges and paper costs all increase, more catalogers are opting against this approach. They’ve run the numbers, and their incremental sales from those catalogs no longer justify the expense.
If you’re in this position, or are wondering how to leverage shipping expenses, try a strategically planned and formally managed bounceback program. A bounceback program can help build your brand, improve customer retention and develop a new revenue stream, regardless of whether you’re in B-to-C or B-to-B.
The key to a successful bounceback program is to target a specific goal. Rather than an afterthought, your bounceback program should be a managed and monitored element of your total marketing efforts. Here are four ways bouncebacks can be effectively used today:
1. Enhancing the customer experience. When marketing a high-quality product, especially as a gift, incorporate a bounceback strategy to promote the quality of your brand, your product and, if needed, to explain the product’s correct usage.
For gift recipients who may not be familiar with your company and products, a bounceback can explain the quality of the gift. It enables you to enhance the recipient’s experience and ultimately that of the gift-giver, who now receives more gushing thanks for giving such a high-quality product.
Take High Plains Bison, a cataloger of portion-cut bison steaks, which includes a bounceback insert in every package it fulfills. The four-color, trifold piece promotes the premium quality of High Plains’ range-raised, grass-fed bison. When customers receive these bison steaks as gifts, they get a clear message: The gift-giver chose and paid for a premium product.
But there’s more. Though bison looks like beef, it’s significantly leaner. When cooked for the same length of time as beef, bison loses flavor and becomes tough, reducing the enjoyment of the gift. With this concern in mind, the High Plains Bison insert features an easy-to-follow chart of recommended cooking times.
This insert solves one problem while creating two selling opportunities. Recipients can cook their bison properly, enjoy its flavor and may consider High Plains for their own gift-giving in the future. The gift-givers receive due credit for sending quality gifts while remaining satisfied customers. As a result, they’ll likely choose High Plains for future gifts.
2. New customer conversion. The sooner you can obtain second orders from new customers, the more likely they’ll remain your customers. This is a key principle of building your housefile and improving ROI. You can increase the rapidity of receiving those second orders by targeting a package insert to your first-time customers.
The most common technique is to offer time-sensitive discounts on customers’ second orders. When included with bounceback catalogs, response rates for these coupons can exceed 5 percent. Though this response rate is high, remember that your actual number of conversions may seem small.
Consider the math:
100,000 prospects mailed
1 percent response rate (= 1,000 new customers)
1,000 new customers mailed bounceback
5 percent response
end result: 50 conversions.
Those 50 conversions may appear disappointing at first blush, but that number can multiply quickly. The same response rate for 2 million mailed prospect pieces would yield 1,000 bounceback conversions.
Just as you track results, test your offers and run projections for your catalog mailings, do the same for your bounceback campaigns. With effective management, your bounceback program will not only build your housefile, but also generate predictable revenue.
Another effective new customer bounceback is the welcome package, which may or may not include a discount coupon. This type of insert is effective when you offer a service, such as free gift-wrapping, a 24-hour helpline (not just an answering service) or some other benefit you wish to keep at the top of your new customer’s mind.
When in doubt of what to include in a new customer bounceback, try a note of thanks, especially if it's hand-signed by the person who fulfilled the order.
To make this type of program work, you must identify new customers at the time of ordering or during order processing within your fulfillment system. From an operational standpoint, the new customer bounceback is often inventoried as an SKU and listed in some fashion on the pick-ticket as an item to include in the package. If you use this type of process, however, develop a system where out-of-stock bouncebacks will not create back-order situations.
3. Inventory liquidation. One challenge in liquidating inventory is that if you overpromote your available stock, you disappoint customers by running out of items. Consider the case of one smart merchandising manager who tracked her liquidation of inventory in terms of average number of each product sold per number of bouncebacks delivered in fulfillment packages. In time, she identified a predictable response and knew how many inserts any given product could sustain based on its current inventory level. Using an inexpensive on-demand printing solution, she continually liquidated inventory marked for discontinuation, avoiding the need for a sale catalog.
4. Marketing continuities. A continuity program allows customers to sign up to receive certain products or types of products on a regular basis. Often these programs market a consumable item, such as Harry & David’s Fruit of the Month Club or Gevalia’s coffee continuity program, or they may market niche products developed on an ongoing basis, such as specialty books.
The intricacies of continuity marketing go way beyond the scope of this article. But if your product line can fit a continuity program, consider developing one. In your projection scenario, include responses based on the number of catalog orders you receive per year. A typical bounceback’s response rate to a continuity offer averages about 0.1 percent. Despite low response and often low average order values, however, bouncebacks are a cost-effective way to market continuity programs, primarily due to the new members’ lifetime value.
Other kinds of bouncebacks include targeting specific segments based on product purchase and cross-selling popular items from a sister catalog, both inexpensive ways to grab interest in different product lines. Your initial numbers from these efforts may seem small, but that’s the nature of bounceback programs.
By operational necessity, bounceback programs only market to a subsection of your housefile — specifically those people who’ve just responded. Based on recency, frequency and monetary theory, however, this same subsection is also your most responsive and profitable segment of customers. Your investment in a bounceback program to target this group will pay off from its cumulative effect.
Brands are built over time, across all channels, one impression at a time. Every place your customer comes in contact with your brand is an opportunity to make a positive and memorable impression. There are no unimportant moments in the life of a brand. But many companies overlook bounceback programs and miss chances to create “magic moments” with their customers.
All too often we assume that our customers know us well. We expect them to be thinking about us all the time. But they don’t. They need to be reminded often of what you stand for, what makes you unique and why they should buy from you. Bouncebacks are perfect opportunities to do just that.
No matter what the goal of your bounceback is, it's one more chance to make a lasting impression.
Brent Niemuth is creative director and brand evangelist at J. Schmid & Assoc. You can reach him at BrentN@JSchmid.com or at (913) 236-8988. George Hague is senior marketing strategist at J. Schmid & Assoc. You can reach him at (913) 236-8988 or at GeorgeH@JSchmid.com.