Direct Marketing: An Investment in Your Business Success
April 14, 2005 - By John M. Bomarito

John Bomarito, Owner, Money Mailer Macomb

As a small business owner, you have many choices on where to invest your advertising and marketing dollars. While the best strategy may employ the blend of several advertising vehicles, today our focus will be on the direct marketing tool in the marketing mix. We will cover other advertising vehicles in future articles.

According to an industry survey conducted by Advertising Age and Lightspeed Research, in October 2003, Direct Marketing was identified as the best vehicle for ROI and Direct Mail was cited as the most accountable form of marketing that builds brands & drives sales.

As Americans become more preoccupied with their busy lives and enjoy many more choices in the types of media and news sources, direct marketing can provide a very cost-effective way to reach the specific audience for your small business service or product.

In addition, through the use of specific offers or calls to action, direct marketing campaign results can be measured and modified for peak performance. It is a very accountable medium.

Like any other marketing strategy, direct marketing results need to be viewed as an overall campaign over time –not as a single event. Business owners who jump in and out of mailings or other advertising mediums are throwing their money away. It can take up to seven times of consistent exposure, before a consumer chooses to act on an offer. That is one of the reasons that marketing expenditures should be viewed as an investment not a one-time expense.

Business owners should measure their campaign effectiveness by the lifetime value of the customer. Comparing customer acquisition cost to the lifetime value of the customer is a much better metric to track than simply measuring revenue from a one-time sale. This truly helps you quantify the value of each customer and determine which advertising vehicle brings you the best type of customer. When considering that on average, it costs three times more to acquire a new customer than to keep an existing customer, you realize very quickly that investing in loyalty programs should be a key component to your overall marketing strategy.

What makes a great campaign? The answers to this question are as varied as the type and number of businesses. Your marketing professional can help you develop a targeted strategy. Following are some fundamentals that you should build your foundation on:

The list makes up over 50% of the success factors in a direct marketing campaign
- Is there waste in the list? (e.g. people who can’t use your service)

Have you identified your ideal target audience?
How much do you know about your ideal target?
- Do you understand your target’s psychographic profile as well as their demographic statistics?
Is the list current? How often is it updated? When was it updated last?

Creative makes up another 25% of the success factors
- Does the ad differentiate your business? Or could anybody’s name be dropped in place of yours with no discernable difference?

Consumers will give you an average of four-seconds to get your message across. Does your ad get your main points across in this time frame?

Is it cluttered with too much ancillary information?

Does the headline or the artwork evoke emotion?
Can someone who has never visited your business quickly understand your proposition? Or do they have to study it? HINT: they won’t study it

The remaining 25% of the success factors is the offer:

Would you act on the offer if it came unsolicited to you?
Does it create a sense of urgency? Does it make you want to act?
10%-Off is not a strong offer. Would you switch loyalties for 10%?
Dollars off typically work better than percentages off.
Don’t make your prospect do the math. Help them by equating the value. (e.g. FREE Service call with any purchase –a $49.00 Value!
Make expiration dates reasonable.

When choosing to work with a direct marketing company, select a partner who is more interested in your business success than in getting the sale. Beware of salespersons selling on the low price. There is no right price for the wrong solution. If they are selling strictly on the price, then that should serve as a warning sign for you to investigate their depth of strategic resources. Their value proposition should include an interest in your long-term business success that extends well beyond the campaign period.

In our next issue, we will look more in-depth at campaign effectiveness. Until then, here is wishing you success in growing your customer base.

John Bomarito has over 20-years of marketing experience and owns Money Mailer of North Macomb. John can be reached at 586-726-0297 or jbomarito@moneymailer.com. You can also visit his web site at www.moneymailer.com/macomb