Three Ways to Cut Customer Acquisition Costs and BEAT the Postal Increase
Last week, I discussed some powerful resources for finding obscure mailing lists that may not be on the traditional list rental market.
This week, let’s take these resources a step further. You can use the below list of research sources to make contact with companies, and then create reciprocal list exchanges and co-marketing partnerships. With this week’s absolutely insane postal rate increase, now is a great time for you to look at alternative ways to acquire customers and even lower your customer acquisition costs.
Again, the resources are:
* Belcaro Shop at Home (www.shopathome.com)
* Catalogs.com (www.catalogs.com)
* Greyhouse publishing (www.greyhouse.com/marketing.htm)
* And www.catalogs.google.com.
One other method I didn’t mention last week is through magazines that target your particular niche. You’d be surprised at how many other companies there are out there with products that have an affinity to yours and that would be open to a marketing partnership.
Here are some examples of the types of programs you can set up with other catalogers:
1. List exchanges. The most obvious way is to exchange housefile names (both offline and online). This will eliminate most of the cost of renting those names. To keep things running smoothly, once you work out your arrangement with the other list owner, you can have your list broker work this like a regular list order. Your broker will charge you a nominal fee for this, called an exchange rate.
2. Package inserts. Trading off space in outbound package inserts can be an excellent source of both leads and orders. Just like paid-package insert programs, set up tracking codes and test creative and offers. For offers, try testing a catalog request vs. a direct sale of a hybrid of each.
As for finding companies to trade with, use the above-mentioned sources. Or, your list broker can help you make contact with the list owners of some of the lists you rent (ones that don’t already have a package insert program running).
3. Endorsed deals. Endorsements allow you to provide your customers with items that are complimentary to your products, thus creating goodwill. Endorsement programs can be as simple as sending out an e-mail or postcard to your customers with a recommendation, or as complex as elaborate syndication programs with revenue sharing. How you structure your deal is dependent on what you and the other marketing team can dream up.
Some other ideas include a store within a store, trading pages within your respective catalogs, or selling other marketers’ products on your Web site and vice versa. The sky’s the limit here.
Do your due diligence on the company you’re considering partnering with. Carefully review its Web site, product offerings, customer service, etc. Make sure your potential partner company’s quality is of the same level as yours.
Also, structure these types of partnerships as any other test. Use the smallest possible circulation/sample to test the waters before rolling out.
I had a client once who thought he had a slam-dunk co-marketing program. The other company offered his company a free test of 50,000 names. After much back and forth, I convinced his company to mail only 5,000 names. Good thing. The test bombed! And by mailing one-tenth as many names in the test, his company lost far less than it could have.
Two words: Be careful!
Speak to you next week.
Jim Gilbert has had a storied career in direct and digital marketing resulting in a burning desire to tell stories that educate, inform, and inspire marketers to new heights of success.
After years of marketing consulting, Jim decided it was time to “put his money where his mouth was" and build his own e-commerce company, Premo Natural Products, with its flagship product, Premo Guard Bed Bug & Mite Sprays. Premo in its second year is poised to eclipse 100 percent growth.
Jim has been writing for Target Marketing Group since 2006, first on the pages of Catalog Success Magazine, then as the first blogger for its online division. Jim continues to write for Total Retail.
Along the way, Jim has led the Florida Direct Marketing Association as their Marketing Chair and then three-term President, been an Adjunct Professor of Direct and Digital marketing for Miami International University, and created a lecture series, “The 9 Immutable Laws of Social Media Marketing,” which he has presented across the country at conferences and universities.