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Selecting The Right List
The typical direct mail campaign generates $10 in sales for every dollar spent—a return of twice that generated by a television ad. Selecting the right list is the most critical step of a campaign, since proper list selection can increase response rates by 60% or more.
First and foremost, define your goals to help you identify and refine the objectives of your campaign. Are you seeking to generate leads? Announce a sale? Improve customer service?
Once you have a goal in mind you're ready to target your audience. First, choose between a business list or consumer list. Then further define your list by geography and demographics to increase the effectiveness of your campaign.
Once you have a broad understanding of list selection, use the list quality section to help you distinguish the winners and the losers.
Finally, the list suppliers and services section outlines what you can expect from brokers and managers, including where to turn for your campaign's specific needs such as graphic design, printing, and list fulfillment.
1. Define your goals!
Before you select a list, you must first determine your specific goals. Unclear goals and indecisive strategies are guaranteed to produce disappointing results. Common goals include:
Increasing store traffic
Engendering customer loyalty
Acquiring new customers/referrals
Responding to competitive activity
Improving customer service
Increasing customers' average purchase amounts
Improving sales force efficiency
Announcing store hours/sales/new location
Supplementing media advertisements to top prospects and select customers
2. Target your audience!
There are two types of lists: business and consumer.
Companies that specialize in business-to-business commerce use business lists, companies focusing on the private buyer use consumer lists. Most list suppliers require a minimum order, and charging $85- $120 per thousand names for basic lists containing just names and addresses that you only get to use once.
Additional contact information (phone, fax numbers, etc.) or demographics (age, income, etc.) carry additional charges. The industry calls these "selects". The number and specificity of "selects" you can choose are virtually endless, but keep in mind each additional "select" will cost you between $5 and $25 per thousand names. Below are examples of "selects" that can increase the effectiveness of your campaign by identifying the audience you want to reach:
For example, you could request a list of 25-35 year-old males who live in Dallas, Texas, who have recently purchased a computer through mail order and earn more than $50,000 a year.
Credit card holders
Responsiveness to direct mail
For example, you could request a list of CEOs of small businesses in the construction industry that have sales of $500K to $1MM, and 10-19 employees.
Number of employees
Standard Industrial Classifications (SIC)
Basic business description
Length of time in business
Type of office
Targeting not only allows you to select exactly who receives your mailing, it also enables you to measure your campaign's success. Through tracking systems like key coding, you know how many pieces you sent, who received them, how much each piece cost to send, and how many responses came back.
3. List quality!
Besides having a clear idea of your target audience, understand that not all lists are created equal. The following are some general guidelines and questions you should ask to ensure your campaign's success:
1. If purchasing a general list, ask who is on it to determine whether the audience contains potential buyers for your product.
2. If it is a list of actual purchasers, how recently were the purchases made? Recent purchases may indicate a pattern or exclude them as potential buyers, whereas older purchases could suggest they are no longer in the market or are due to make a new purchase soon.
3. Is it a list of everyone who responded to a previous mailing or of actual purchasers? This can help you differentiate between those who are responsive to mailings and those who actually make purchases.
4. How often do they purchase? Ask for a "hot name" select list of those who have made purchases within the last 90 days.
5. When was the list last updated? Lists go stale over time as people on the list move or change their purchasing patterns. Ask if the list has recently been "cleaned" by putting it through the U.S. Postal Service National Change of Address (NCOA) file. A deliverability guarantee can provide insurance against stale lists.
6. Inquiring about how much money has been spent on each purchase by people on the list can help you determine if they are potential customers for your product and its accompanying price.
7. How often has the list been rented? You don't want to send mail to people who are inundated. Conversely, some lists are rented repeatedly because they consistently result in sales.
8. If the list came from a company that compiled it, ask to see a sample of their mailing. This may be the most valuable way to see the relevance of the list for your purposes.
4. List suppliers!
• List owners (generally large corporations) retain list managers to not only maintain and execute their lists, but to rent the lists out to list brokers and the end user. Some list managers are also list brokers, and vice versa.
• List manager: A manager is responsible for generating a marketing plan and advertising the mailing list. The company handles all the rental arrangements on the list owner's end, sending the names to the fulfillment house, invoicing and collecting for each rental transaction, reporting and paying receivables due to the list owner, and protecting the list from misuse.
• List broker: A broker specializes in preparing list recommendations for clients based on the product offered, and the projected target audience and customer base. A broker's services may include research, selection, recommendation, and subsequent evaluation.
When shopping for a list, keep in mind list firms can offer several ancillary services to help you implement an effective direct marketing campaign. These can include:
• Database management: The company will manage a prospecting database containing names and addresses of as many people as you can identify who would be potential customers for your products and services. Identifying appropriate lists, merging these lists, and eliminating duplicate names creates the prospecting database.
• Fulfillment: The company implements your entire direct marketing campaign via lettershop services such as folding, sorting, inserting, labeling, and addressing, and may even provide telemarketing services.
• Graphic design: The company helps you design the mailing piece you want to send to prospective customers.
• Merge/Purge: The company combines two or more lists, eliminating duplicate names and unnecessary demographics at the same time.
• Printing: The company provides you with printing services such as full color digital printing, personalized letters, forms, statements, self-mailers, covers, tabs, color inserts, and personal messages.
Call 1-800-861-3969 for assistance.
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