October 9, 2012

Getting Economic Value Out of Your Direct Mail Strategies

Stephanie Miracle

Agenda

Transforming Changes into Opportunities

Unleashing the Power of the IMB

Improving Deliverability

Testing for Fun and Profit

HOW TO TURN INDUSTRY CHANGES INTO OPPORTUNITY

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Enables print production from white stock

High customer impact, cost effective all color, high speed, 4-Up printing

Electronic sorting capabilities with diversion to physical commingling for best postage

White Paper Factory

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Variable Digital Print (VDP)

Merging database information with digital imaging technology

Printing unique content on each page

The end result is a unique, highly relevant message to each individual in a marketing campaign

Innovation: Variable Data Printing

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Color Document Template

Standardized high impact color template

Uses onserts, in-line inserts to enable uniform production

Layout accommodates standardized windowed envelopes

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2013 promotions calendar expected with new rate adjustment (early Nov).

Leveraging the second ounce in First Class Mail

Addressing solutions and requirements

USPS considerations

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Improve Deliverability to Increase Response Rates

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The Undeliverable Mail IssueI am your customer

How quickly can you find me before . . .

You suppress me You discontinue my service You don’t collect from me You move me to collections I miss an important legal notice I don’t respond to your offer I call you and complainI am lost forever

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Non ZIP+4 coded: 50% to 70% reduction in response.

Missing apartment number: 30% to 40% reduction in response.

Invalid apartment number: 15% to 25% reduction in response.

Mailing to an old address: 20% to 100% reduction in response.

Vacant address: 40% to 60% reduction in response.

Deliverability Issues to Consider When Determining Which Records to Mail

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Successful Database ManagementGet It Clean

Postal Experts correct and Standardize addressesClean up undeliverable / suppressed addresses

Keep It Clean

Continually maintain addressesPostal Experts develop and maintain a best-in-class addressing / return mail process

Keep It Current

Establish a confidence level for the delivery of each addressEnable the mailer to determine if the mail piece will get delivered and decide if the mail piece should be printedPerform address quality functions to maintain postal discountsImprove mail delivery

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Unleashing the power of the

IM® BC to impact your bottom line

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Identify mailstream objectives Automation incentives Address Quality: OneCode ACS® / Full-Service ACS™ Mail Tracking: IM BC Tracing™ service

Unleashing the Power of the IM® BC

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Identifying Business Needs

Group ApplicationIMB Data Confirm

Delivery Predict ACS

Job # Name

Acct #

Doc Data

Remit IMBC

Remit $

Discounts Job Tracking Job Delivery

Campaign Mgmt Call Center Plan

SVS Piece Queries LEGAL Proof of Mailing

Cash Flow Collections

Cancellations UAA reduction

Data Required

MAIL

MKTG

FIN

BUS

Busin

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Keep your IM® BC unique for at least 6 months

Know who didn’t get your mail: ACS

Use the IMb to help automate processing of responses

1 in a 1,000,000

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In-home delivery projections

Staffing

Multi-channel marketing

How can tracking data be beneficial to business?

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Revenue anticipation

Critical mail alerts

Postage savings

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Coordinate additional touch points such as email or mobile messaging around in-home dates

Identify responders at the time of reply

Compare and trend delivery times for different classes of mail

Analyze response times based upon in-home dates

Manage staffing

IM® BC tracing:

Tracking Outbound and Inbound Mail

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Differentiated IM® BC

Implementation Solutions

Composition Post-Composition

Pre-Production

Post-Production

Document Composition

SoftwareApplied to address

block during composition

Distributed Output

ManagementSoftware

Applied to address block after

composition

Distributed Printing

Management Software

Applied to address block in output

management system

Hardware Based Sorters, Inserters

Generate, print and verify IM®BC

on envelope;Piece-level tracking

Considerations: Printing environment must support new IM® BC graphic (drawn or fonts) Sequence number must be managed and associated with “keys” (full) For outsourced mail preparation, keys and sequence numbers must be associated

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Getting The Most From Your Direct Mail Plan:

Testing and Measurement

Get the RIGHT message to the RIGHT person at the RIGHT time

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The Plan… In writingWhat is the goal of your campaign?

Generate leads? Close sales? Raise awareness?Donations? Drive traffic to your store or Web site? Once you decide on your goal, establish a baseline and track responses against that baseline.

The Mailing List - Who are your best customers? Identify who they are and then get lots more exactly like them and market to them.

The OfferWhatever your direct mail campaign offers the target audience – a free premium, a gift for visiting a trade show booth Sell the benefits of responding and receiving the offer.

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The Plan….. In writing, cont’d

Your Mailer Testing really plays a crucial role. Without testing your mailing list, your offer, or your mailpiece design,

you will never know if the campaign’s success was due to a compelling offer, eye-catching graphics, and enticing copy with a strong call to action, or a great list.

Campaign Cost Divide total cost of your mailing (including creative, printing, postage

and labor) by the revenue generated from an average sale

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Direct Mail Basics

The DM Formula 20%

40%

40% Creativity

The Right List

The Right Offer

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What to Test

Product or servicesMedia (list, print, broadcast, electronic)Offer (the proposition)Package/format/creativeReply device

BRE vs. CREStamped vs. No StampSingle Stamp vs. Multiple

Fundraising PremiumsAddress labels, greeting cards, calendars

Copy platformTiming of promotion

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How many elements should you test at a time?

Lastly, remember to reserve

a sample that won't receive

a promotion at all for

control-analysis purposes.

One. Testing more than one element will make it impossible for you to know what makes a difference in results.

Of course you can certainly have more "cells" in your test to test other elements simultaneously. But each cell must only test one thing.

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Valid Sample Sizes

Have some idea of the level of response you expect or need.

Decide what confidence level you will live with in testing.

Decide what level of variance you can live with in the test generated responses.

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Calculating ROI

Quantity of Mailing Return On Investment Survey25,000

Total Production Costs Total Developmental Costs Quantity of Mailing Campaign Costs PRODUCTION ADMIN

12,500$ 12,500$ 25,000 25,000$ 12,500$ 12,500$

or or

List Acquisition (per 1000) Administrative and Planning

-$ -$ -$ -$ 25,000

Printing (per 1000) Creative Projected Response Rate 1%

-$ -$ 1% -$ -$ 250

Seperation and Proofs Photography Conversion to Sale 1%

-$ -$ Profit per Sale 1% -$ -$ 3

Data Processing Legal 5,000$ 5,000$

-$ -$ -$ -$ 12500

Lettershop Other

-$ -$ -$ -$

Postage Costs Net Profit ROI %-$ -$

Shipping Costs 12,500$ 50%

-$ TOTAL CAMPAIGN COSTS -$

25,000$

-$ -$

12,500$ 12,500$ 25,000$

Production Worksheet

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Results

The goal in testing should be to try new testing elements to beat the tried and true “Control” package..

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Control Group Creative 1 Creative 1 Creative 2 Response Response Response ResponseList/Segment No Action Offer A Offer B Offer A Rate Rate Rate Rate

Group 1 + - - - 28%

Group 2 - + + + 13% 15% 11%

Group 3 - + - - 12%

Group 4 - - + - 14%

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Direct Mail testing Tips

Add the word “FREE” to your outer envelope teaser copy.

Put ad headlines in quotation marks.

Test a phone follow-up to non-respondents.

Offer a free sample to overcome the “I don’t believe it” objection.

Say “thank you” to gift-buyers with no-strings-attached gift certificate for them to use.

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Direct Mail testing Tips

Use the flap side of the envelope as the address driver

Put your deadline on the outside the envelope.

Change the color of the outer envelope.

Include a deadline in your offer

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Questions?Thoughts?Comments?

Questions and Answers

Stephanie MiracleEnterprise ConsultingPitney Bowes Management Services816-778-9408 Stephanie.Miracle@pb.comwww.pb.com | www.pbmanagementservices.com Every connection is a new opportunity™

THANK YOU.

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