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Powerful Techniques for Getting Profitable Response from Co-op Mailings and Package Inserts By Larry H Tucker Every insert in a co-op mailing or other ride-along program asks for some type of response: an order, inquiry, request for further information, telephone call—or a store visit with coupon or discount certificate or prize voucher in hand. But not all responses are of the same quality. This has led many advertisers to attempt to distinguish between genuine prospects and “suspects”—people who don’t pay for their subscriptions or club memberships, who don’t qualify for the terms of your offer, and those whom you generally want to discourage from responding in the first place. The method and techniques you adopt for facilitating or inviting response should therefore aim to bring in as much profitable response as you possibly can, while “weeding out” the deadbeat, the casual inquiry and the literature collector. Most direct marketers have found that providing an easy-to-use response device, with or without pre-paying the postage, definitely increases the initial, impulsive response to their offers. The consumer doesn’t have to stop to get scissors to cut out an order form, find an envelope and then address it—all of which can distract her to the point where the order may be forgotten or the insert put aside. I must point out that there is a good argument to be made that, for some “soft” offers, it’s ultimately preferable to make the consumer work a little harder to respond. This definitely improves the quality of the response and the back-end payout, but may drastically cut the number of responses down. A similar argument applies to ‘800’ (free)versus ‘900’ (paid) telephone responses or orders (see below). You may decide after analysis that you’ll want different formats for different media or offers .The “stamp/no stamp” decision There’s no question that providing return postage for the consumer will generate the largest number of up-front responses. In many cases, the advertiser will certainly be inclined to pay the return postage (19~ + = 28~) on a business Reply Card ordering a product. But the quality of responses generated in this manner must be determined by testing and analysis. The main disadvantage of providing return postage for some offers is that you may get a large percentage of unprofitable responses, particularly from people who have no intention of paying, along with bible tracts, nasty notes about “junk mail,” and other useless or inappropriate (and costly) responses. If you’re a publisher offering a trial subscription, or a continuity club which sends relatively valuable materials out as a first shipment, then you’ll want to test each medium and offer carefully with the “stamp/no-stamp” option before committing yourself to big numbers. One medium or program may bring you a low percentage of “no pays,” whereas the same offer in another program may yield a much larger volume of deadbeats. In the package insert or statement-stuffer fields, there may be a marked difference in the type of response generated by different products, different offers, or even seasonality (following a sweepstakes mailing, for example). You can of course utilize other techniques to cut back on unprofitable response, while still enjoying the response boost of prepaid postage and a pre-addressed response vehicle. Many marketers have found, for example, that asking for a signature or a telephone number (or both) cuts back dramatically on fraudulent or spurious orders, especially from younger people. If it’s appropriate to your offer, you could ask whether the respondent owns or rents her/his residence. One-step versus two-step It’s often much easier to get the average consumer to send an inquiry rather than an order. And although this necessitates a second step (and a falling-off of feedback response), it can be very profitable. For a costly item like home siding, or study at home courses, or even furniture or bedding, the two-step has proven itself over and over again. Particularly in concert with outbound telemarketing, these types of lead-generating programs can be very productive. You can sell vacation or retirement, cruises and travel, even automobiles with a well-planned and organized two-step program. An imaginative variant on this type of program is one in which the order can be sent in without any money for the ordered item. An invoice is then sent by the vendor, along with additional selling and/or descriptive material, to reassure and perhaps even up-sell the buyer. In some cases, only the first installment payment is requested at this time (often just enough to cover the marketer’s cost of manufacturing and shipping the product). The product is hipped upon payment of this initial installment, and additional invoices follow. Each additional invoice can be accompanied by promotional material for additional or supplementary items. Although this works well with a request for payment by money order or check, it’s even better to encourage a credit card payment, for obvious reasons. Some credit cards now allow a monthly installment payment, which is ideal for this type of selling arrangement. Several ways to include a response panel on your insert To supply a BRC, you’ll have to print your offer on a high bulk stock (7 points or thicker), which may cut back on the color intensity and quality look of your piece. And you’ll need to allow about half of one side of your typical insert sheet for the return address panel. One way around this (particularly if you’re asking for credit card or other confidential or personal information) is to print your offer on one side and half of the back of a 5-1/2” X 8-1/2” or even a 5” X 7-3/4” 50# coated sheet. Your return address panel takes up the other half of the back, and you ask the consumer to fold the piece in half and tape or staple it closed before mailing. The combined thickness of the folded sheet gives the piece the necessary weight and sturdiness to pass post office regulations requiring a total of 7-point thickness. Another option is the “bank-tail” envelope, which gives you about as much surface area for your selling pitch as a regular insert. In this format, one side measures up to 5-1/2” X 8-1/2”. The “flap” on the other side can measure up to 5-1/2” X 4-1/2” (leaving half an inch for the glue), and it can tear off and become your order blank. Although it costs more than twice as much as the standard loose-sheet insert to produce, this format offers a major advantage if you need to get back a check or cash with the order. Will an ‘800’ number pay out for you? The wide acceptance of toll free ordering via the ‘800’ telephone numbers has resulted in a shift in many catalog orders to the telephone—more than 50% of orders for some catalog marketers. But the total cost of tolls and the calling center still make the ‘800’ response quite expensive. Industry averages are 12-15 incoming calls per line per hour, and equipment and toll charges average about $12 to $15 per hour. No matter how you figure it, your costs per order or response will be substantial. Because of this cost, a number of marketers do not use the ‘800’ number option except for firm orders coming in with credit card numbers. On the other hand, an ‘800’ number incoming call gives you a perfect opportunity to sell-up, and you can enter all information instantly on-line. The additional sales may well pay for the call several times over. If you do decide to use an ‘800’ number for incoming orders or inquiries, feature it prominently on both sides of your insert, and in your response card or coupon. Don’t bury it. Incidentally, research by the Direct Marketing Association tells us that orders for clothing and accessories are the hottest area for ‘800’ calls—probably because of the interaction with the order-takes and the many options available. Gourmet foods, vitamins and health remedies, and bed/bath linens are other areas where you’ll probably want to use an ‘800’ number. Should you try a ‘900’ number? The proliferation of ‘900’ numbers in the last year or two has led to a great deal of discussion in the direct marketing community. While there are a number of marketers who have profited handsomely from these consumer-paid calls, there is also a large amount of consumer distrust of the whole idea, caused by a few highly publicized “bad apples.” If you have a service or information to provide (anything from sports scores to astrology to weather to credit-seeking data), then the automatic charge feature of the ‘900’ numbers should be a boon to you. Several sweepstakes games have drawn strong response, and there’s even a ‘900’ interactive version of the TV game Jeopardy. Government regulation is pending because of the public’s outcry after several well-publicized “scams.” The lesson learned is to be sure that a real value is received (either in entertainment value, information, or product), and that program is administered by reputable professionals. Children should not be encouraged to call (even with parents’ permission). A good national ‘900’ company will keep you abreast of restrictions imposed by individual states, of coverage offered by the various networks (some rural areas are not covered), and of specific offers and wording that are not allowed. Legislation proposed in Congress and in several state legislatures calls for a toll free warning or “preamble” introduction for 20 to 60 seconds, with an explanation before any charges are imposed. The technology is in place for callers to a ‘900’ number to actually place orders automatically. With a touch-tone phone, they can key in a code number from the label on a catalog or mailing, which then accesses their unique file from the computer; then they answer a series of programmed questions from a chine to place even a complex order. A soap opera review magazine recently received more than a million subscription orders via this type of ‘900’ number advertised on the soap operas themselves. And they’re renewing subscriptions via the ‘900’ number, too! Many of the large inbound telephone facilities have the capability to switch over an inbound ‘900’ call to voice-interactive communication. Sprint recently installed a ‘900’ to ‘800’ crossover system: after the first contact is paid for by the calling party, the called party assumes the cost for the remainder of the call. Both “800 and ‘900’ callers can be asked to key in their telephone numbers to access their file, if this unique number is part of the mailer’s Master File (as it is with Radio Shack and Sears, for example). Or those without touch-tone could call another inbound number with access to a live operator, who would then key in the number as given to her over the phone. And new telephone equipment even makes it possible for the called party to instantly identify the calling number and access the caller’s file automatically. As a matter of fact, American Express experimented recently with a system that allowed the operator to answer the phone with a friendly but disarming, “How can we help you, Mr. Tucker...?” The Amex equipment had identified my calling number, and this automatically triggered the appropriate file to appear on the operator’s screen connected to Amex’s computer database. But all of this has proven a little to startling for some cardholders, and the process is now undergoing further evaluation. If you have an initial offer that costs $2.95, it would not be unreasonable to ask the consumer to place a ‘900’ number call, which would be billed to her at the $2.95 rate. Although the amount remitted to the vendor would be only from one-half to two-thirds of the $2.95, the quality of the customer would probably be better than a comparable ‘800’ response. And your pay-up would be virtually 100%! A two-step inquiry or lead-generating or catalog request program might do well at75~ - $1 per inbound ‘900’ call, with all proceeds going to the telephone hookup. That’s quite a qualifier, and is actually less expensive for the vendor than a returned postpaid card! So you see, there are a number of response options open to you, even though you can’t have the luxury of that separate order form and response envelope that you may favor in your solo mail campaigns. A little imagination and a lot of testing and analysis of results over time will undoubtedly bring you the combination of factors that works best for your offer. But if you radically change the offer, the terms, or the product, you should definitely re-test your various response options. Next time, we’ll discuss the many ways in which you can continually improve your insert program, keeping a step or two ahead of the competition while you increase your profitability. | |||||
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