Getting Customers Through Direct Marketing
By Jeff Dobkin
Posted Monday, August 23, 2004
Get new customers. Now keep them, by making sure they stay satisfied and happy. All with low-cost, tested direct marketing methods. Sound good? Here’s how.
Direct marketing is a low cost way of reaching-in with your message and piercing that gruff exterior customer shell and finding your way into their hearts, minds... and wallets. It doesn’t matter whether you get all of your business from a half-dozen large accounts right in your own neighborhood, or if you are marketing a new product to millions of folks worldwide.
Major Uses of Direct Marketing Campaigns
Direct marketing can be the most effective way to get leads and deliver hot prospects. It’s also used to sell to customers directly, without further human intervention. As an added bonus, it’s easy and cheap to use these same direct marketing methods to retain current customers and keep them happy. I say CRM, customer retention management, but what crap - a new term pinned on something we’ve been doing for years - keeping customers happy.
Here’s an example. I was once called in to analyze the marketing program of a large insurance company. I found out they lost about a third of their customers every two years. Further analysis showed me why.
"I know what your customer received from you in your last correspondence with them," I said with a smile. They looked at me, puzzled at how I would know. I continued, "It was a bill." Everyone smiled and nodded. I was right. Now the bad news: after two years of bills, and not one "Thank you for your business!" letter, most people just drifted off to another provider. For the price of sending two letters each year specifically to thank customers, I figured they could boost their customer retention rate by 75%. You can too. Same low cost: 74¢ a year.
Direct Mail: Still the lowest cost marketing tool
Despite the continual rising costs of postage, direct marketing is still a great value. It’s the lowest-cost type of marketing because of its precision and accuracy. With direct mail you can send a message to a specific target audience without a lot of wasted expense. For example, you can mail just 100 letters to a list of your 100 best prospects. This simple project is one of the most effective direct marketing campaigns I can think of, and I recommend this to any business. Over the next 6 months, mail a letter to your 100 best prospects each month and it actually is the single most effective campaign, ever. Any arguments?
So, for the cost of a single letter to 100 prospects, all of $37 in postage plus a couple hundred sheets of paper, you can pierce the corporate veil. You can, with a surety of 95% or better, get a piece of paper with your own message, and in fact your own personal signature on it, to land on the desk of almost anyone. This list includes presidents of large corporations, government officials, HR directors, chain store buyers, even the person who buys products for L.L. Bean or the Brookstone Catalog. Whomever. How great is that? How effective is that? I don’t think you can do any better than that with any other marketing method.
So here’s one of my best marketing tips: Do it now. Write several tight, great letters and mail them to your 100 best prospects over the next several months. Send a copy to me, too. I’ll respond and give you my thoughts, I promise.
Types of Direct Marketing
The primary route for direct marketing is the mail and for good reason: you can aim a single piece of marketing material directly at your absolute best target with the precision of a sharpshooter. The ammunition you use? It can be a post card, self mailer, brochure, flyer, letter -- all with or without an envelope. Each has its place in the marketing mix. Let’s take a look, along with the view through scope you’re using: the mailing list of possible targets.
Post cards --
Post cards rock because they have exceptionally high readership - by the time your recipient gets it in his or her hand... it’s... it’s... already read. Other advantages: Easy to address, cheaper to mail than letters and cheap to print, too. There are lots of great specialty post card printers; post cards can be printed in 4 colors and purchased for about $400 for 5,000. Just look around for great prices. I also like post cards printed in just one or two colors. Well thought-out cards can be striking in copy and graphics even if your budget is limited to printing cards in just one color.
Post cards work best as lead generation devices, especially for products that people are already familiar with. Cons: You can’t tell a long story, or offer a consultative selling proposition. Also, post cards are always impersonal and suffer from a reader’s short attention span - if you don’t capture the reader’s attention in the first 3 seconds, the card gets tossed. In a big office there is a danger that the card may be thrown away early by a mail screener. For additional information on post cards, see my article, "Marketing with Post Cards" elsewhere at this site, or at (www.dobkin.com).
Recommendation: Make your post cards work hard by generating a phone call to you. Use a strong headline - grab attention fast! Flaunt your biggest benefit to immediately capture the interest of your audience. This is no place to be subtle. Since there’s little room for long sales copy, write copy to generate a phone call from a qualified prospect instead of trying to actually sell your product directly from the card. Just flush out the interested, offer to send them a longer (harder-selling) package if oh, they would just pick up the phone and call now. Print your phone number in a large, bold typeface.
Self Mailer --
These can take on any of thousands of forms, shapes and folds; from a simple trifold to a 5-color, box-cut, pre-scored, die-cut 12-fold brochure with a handy self-addressed, already filled out with the customer’s name reply card attached. Self-mailers allow you to show the most creativity and personality. Cons: Very short runs are impractical for complex pieces or 4 color. They usually aren’t personal and are almost never warm and fuzzy.
Recommendation: Use striking graphics and set a unique tone. Ask yourself, "If he receives this in the mail again in 4 months, will he remember he received it before?" If you answered no, go back and redesign the piece to make it a more memorable. Make your piece hard-selling - remember if they didn’t call, your piece failed. The creative use of one or two colors work just fine and can save on printing costs.
Letter --
As an effective marketing tool, this is my own personal favorite. With a well-written and well-designed letter, you can generate a lead, or actually make a person pick up the phone and call to place an order. What more could you ask for from a few sheets of paper? Oh, yeah - you can do that too: endear someone, build loyalty, and convince them they are the most important customer in the world. Yes, with a letter -
just a sheet or two of paper. Cons: If you can’t write a tight, memorable letter, you can sink like a stone without a ripple.
Take your time writing. It may take you a few weeks to write a great one page letter - but that’s OK. I have clients call me up all the time and say they just can’t come up with a letter that is as good as one of mine. I ask how long they worked on it, and they say "Oh, about half an hour." I tell them to go back and put in the other 8 hours. It still takes me 8 to 10 hours to write a tight, one-page letter.
Recommendation: Spend some time writing and refining and editing your letter. The best campaign I’ve ever written (which can be found in my book, Uncommon Marketing Techniques) is a series of letters, each sent about a month apart, to a list of a handful of my best, tightly-qualified prospects. Feel free to use these letters for your own personal campaign... once you buy my book, of course. Or download them elsewhere on this site for just $20.
- Letter and Brochure --
An envelope containing a letter and a brochure is the workhorse of the direct mail industry. There’s a reason: this format works well for a multitude of offers. The letter sells, and the brochure tells. Design the letter to sell the benefits and generate the phone call. Design the brochure to add credibility to the letter. It’s one thing to say in a letter "Our Olympic size pool with swim-up bar is breathtaking." It’s another to show it in a 12" x 18" photo pull-out. Cons: This format is overused, making it difficult to leave a unique impression.
Recommendation: This is the easiest format to use in mailings, and the most successful format for most mailers. I recommend this format for both large and small firms. You are working with the same 2 sheets of paper as everyone else: get creative. Get noticed. And get a phone call - which should the the objective both sheets are written to.
Successful Mailings
There are several common elements that pertain to anything you send in the mail. First: Design each piece to a specific objective. What are you actually trying to do with this piece? If the piece works perfectly as planned, what exactly will happen in the very next step? Generate a sale? Generate a lead? Generate a phone call? Secure an order? Make someone feel good about you and your firm? Set up a prospect to receive your phone call? Create an impression the recipient won’t forget? Whatever it is, write it down first, then draft each each word, each piece of your mailing package to fulfill your objective. This gives you additional clarity when writing.
I’ve seen more direct mail response killed by the author writing to the wrong objective. And here’s the most common killer: Trying to sell a product from the page, instead of trying to generate a phone call and a qualified lead. Beware of this trap. If your product or service needs more than 200 words to sell it successfully, go for the lead generation package. However, if you can write a long and well-focused direct mail package, it is possible to sell products or services.
The Letter
First, create a striking headline -
Like an ad or press release your letter has a headline: it’s your opening sentence. In fact, your opening sentence should also be your whole first paragraph. Yes - your whole first paragraph should be just a single sentence, two at most.
Just like in an ad, the first line of your letter never sells anything. The objective of the first line is to arouse interest, otherwise your package faces an early death - by trash can.
I recommend you use the Jeff Dobkin 100 to 1 rule (from an article in my book, Uncommon Marketing Techniques, called, appropriately, The 100 to 1 Rule): write 100 headlines, then go back and pick out your best one. Hey, I didn’t say you’d like it, I just said it would be effective at helping you to create a great headline.
Still stuck? Throw your biggest few benefits into the headline; here’s the headline formula: "New product offers benefit, benefit, benefit!" Example: "New sprinkler waters your lawn more thoroughly yet saves water, reaches a larger area, and turns itself off when finished."
Another formula for creating a great headline, offer something for FREE, preferably free information: "FREE BOOKLET shows you how to benefit, benefit, benefit!" "FREE BOOKLET shows you how to repair your leaky roof, stop downspouts from clogging, and keep leaves from accumulating in wet areas."
Let readers express early interest by calling you and asking for your booklet. When the phone rings the last thing you do is ask for their name and address to send the booklet. First, you strike up a dialog. Qualify them as a prospect, suspect, or someone with a phone in their bathroom and no magazines. Remember, when the phone rings, the letter or mailer worked. Now it’s your turn. Design tip: whenever you use the word FREE in a letter or brochure, make sure it’s in all capital letters.
Expound on your biggest benefit -
Don’t hold back: flaunt your biggest and best stuff first. If you wait until the 6th page to show the FREE Chevrolet Corvette that comes FREE with every policy, your readers will be long gone by page two.
In direct mail you fire off your biggest guns up front! Be succinct and fast paced, especially in the first page of your letter. Reason: with the first page of copy, there is no commitment to continue reading. If your letter is only so-so, it’ll be so-long: a short history lesson you tried to teach by the end of the first page. Keep the reader moving along, especially in the early part of the letter.
If your letter is great until the 5th page, the reader is hooked by that time. He’s interested, and by page 5 the reader has already made a commitment to continue reading. So at all costs, keep your reader reading through the first half of your package. The longer he’s in your package, the better your opportunity to sell him something.
Here’s a third rule: Keep it short. It’s much better to say too little and have the reader call for more information, than to spill your guts out all over his desk and have him throw the package away before finishing.
Enough rules. If you want more rules, get married. Just kidding. I married a wonderful woman... and that’s not just my opinion, it’s her’s.
Letter design -
So... let’s see... oh, yes - we were writing about our biggest benefit and how wonderful our product or service is, how much they’ll enjoy it. If you’re selling via a direct offer, remind them, they could have it all... ohhhhhh, if they’d just send you only $29.95, but better hurry - supplies are limited! Spend a paragraph or two expounding your biggest benefit. Keep paragraphs short - 7 lines maximum. Vary paragraph length.
Create a bulleted list of benefits and place that list right in the middle of your page. Bulleted lists have exceptionally high readership and act to break up the copy and make the letter visually attractive and appear easy to read.
If the objective of your letter is lead generation, offer a "FREE booklet of worthwhile information," to generate a phone call. Can you come up with a booklet title that is so entrancing your readers MUST have it? Use it here. By using a "FREE booklet" technique with a powerful must-have title, your letter can now be much shorter. Interested parties will go for the free booklet.
If your product or service is a consultive-type sell - if your product, service or selling proposition needs a long explanation; or if you’re selling something high priced, you’ll need to send a longer letter. But don’t let your message - and offer - get lost in the clutter. Remember, one overly long sales letter gets thrown out, three short letters saying the same thing all get read.
Call me crazy but I like to ask for a phone call several times in the letter, and in the last paragraph in the body copy I generally place my phone number right in the copy, even though it’s in the letterhead. It’s a subtle suggestion to call again.
Sign legibly. While you may scribble your signature on checks, direct mail readers want to be able to see it’s really you - so your signature becomes a graphic hook: make sure they can read it.
Finally, restate your most powerful argument for calling or ordering in the PS. Keep it short and sweet - and put your phone number in the PS again, even though you may have it other places.
The Brochure
Show the benefits of what you’re selling (the great things that happen to the reader if he buys and uses your products) in the letter, and show the features (physical points of what your service or the product has) in the brochure.
Of course, being an old direct marketing guy, I always like to place a few of our biggest benefits in the brochure, too. Here’s why: Brochures usually need to be designed to be a stand-alone piece - so they can be mailed, left at a prospect’s office or handed out during a show. As such, I recommend you always show your top three or four benefits in the brochure.
The brochure can be one, two or four colors. If there’s only room in the budget for one color - call it a "Data Sheet"; they work just fine in black and white. Either way, a good design implies that the reader will receive a well-designed product. I firmly believe great design negates the necessity of four color.
Please note: Never, ever stick a brochure in an envelope and call it a direct mail campaign. Always, always include a letter. For the additional cent and a half for the sheet of paper that your letter costs to include, it’s cheap insurance and can double, triple, quadruple - or more - the response you receive.
The Envelope
My preference is to design everything in my mailing package for one fold (5-1/2" x 8-1/2") which - is my own personal favorite, to be mailed in a 6" x 9" envelope. More traditionally letters and brochures are designed to be folded in thirds to fit into a more standards number 10 envelope (9" x 4"). Ugh.
Teaser on the envelope? My favorite: "Gift Certificate Enclosed!" Your certificate can be good for your informational booklet, ("A $7.95 value, sent to you FREE with the this Free Gift Certificate.) Gift certificates are cheap to print, ship flat, have no cost until redemption, can be offered for excess material you’d like to get rid of.
Don’t like teaser copy? Here’s another cheap trick: just type your name and business address (no business name) on the envelope corner, then hand write or image the name and address directly on the envelope (no labels) and people will think it’s a personal letter from you. You’ll enjoy higher-than-normal opening rates.
Mailing Lists
Of all the places to err, the selection of the wrong mailing list is the worst. If you buy the wrong list, your mailing produces, umm... nothing. It’s like trying to sell Chevy hubcaps to Ford station wagon owners.
The best list you can mail to is your own house list of your own prospects and customers. Did I make that clear enough? Start gathering names right now.
If you can figure out the common elements that make your customers unique, you can specify those characteristics in a mailing list. Purchase mailing lists from brokers (found in the phone book), or better yet get a copy of Target Marketing Magazine (215-238-5270; (www.targetonline.com)), and you’ll find dozens of brokers to call and harass, er... ask questions to.
There’s usually a 5,000 name minimum for buying or renting mailing list names. This doesn’t mean you have to mail to 5,000 names, but you may have to buy this amount.
There just isn’t room to do justice for list selection criteria in this article, so here’s where to go for more information. Mailing lists are the critical element in direct marketing campaigns, and you can find selection criteria at my web site (www.dobkin.com) and also... check out my books at a library, they’ll order them for you - just ask: How To Market A Product For Under $500, and Uncommon Marketing Techniques.
I’d be happy to send you 3 articles I’ve written on mailing lists: "12 Questions To Ask a List Broker," "FREE Catalogs of Mailing Lists," and "How To Buy a Great Mailing List." The cost is $7 and please include a large stamped (5 oz. = $1.29 postage) envelope. Credit card orders - just give me a call: 610-642-1000. Criteria for selecting a mailing list varies with what you are selling, what you are offering, the market, and how tightly you can define your targets - who your most likely customers are.
Low cost testing
Any major mailing first goes through a small-mailing testing stage. This is where you mail smaller quantities to figure out if mailing to the entire list will be profitable. While you can mail just 100 letters to a house list and be profitable, the results from this small of a mailing to a rented list won’t be reliable.
If you’re a real small firm, mail 500 pieces to test the results. The more you mail, the greater the accuracy of your prediction of the success you’ll have with your next mailing to the same list. At around 1,000 pieces you can start to get a real feel for the success of your list and package.
The biggest benefit of direct mail is that once your mailing package is successful and profitable from smaller test mailings, you can start ramping-up to larger and larger mailings using the exact same package to the same list. If you do this correctly, you’ll find you’ll keep getting the same results. I know a lot of people who have gotten very rich from this method of marketing.
Here’s a handy tip: If you’re selling a product directly from your direct mail package, start out by doing the math backwards. Figure out what percentage of people need to purchase your product to cover the cost of the mailing. Figure your mailing costs at 50¢ per package. (This cost comes down with larger mailings.)
For example: If you mail to 1000 people, you’ll need to cover $500 in mailing expense, then your cost of fulfillment (product cost plus shipping), plus some profit left over for you to call your mailing a success. If you need more than a 1-1/2% to 2% response to cover your costs - and profit - to produce a successful mailing, better rethink. If your product sells for $25 and your profit is $10 each after shipping, you need to sell 50 units to cover the cost of postage and break even. That’s a 5% response - unrealistically high.
Most direct-response rates for direct sales are under 2%, and most - well under. But by giving away a FREE booklet with an awesome, must-have title, your response can be as high as 25%. But your hard-selling, secondary package to this more qualified list must be able to draw enough response to cover all costs. Looking at these figures you can see why products that sell for less than about $50 don’t work in solo direct mailing. Even at $50 list, with a profit of $25 per sale, you need to sell 20 units per thousand to break even - a 2% order rate.
These numbers show you why your list selection is so important: if you can find a highly focused group of people (or market segment) that all want your product and are most likely - and are willing - to order from your mailer you might just find success.
Sidebar
Looking at all your advertising options? Direct marketing is the lowest cost, and most precise of all advertising venues because it offers the least amount of wasted advertising expense. And it’s fully testable - you never have to lose big money if you just test small quantities. But - and like my aunt Martha, this is a big butt - you need to have a highly qualified list to mail to.
Direct marketing is excellent for both generating leads and closing sales. A small, effective direct mail campaign is as easy as placing a few hundred letters in the mail to your best prospects, which is one of my most highly recommended campaigns. I can’t imagine anyone I’d rather write to than a well-focused list of my best prospects. Can you? There should be room in every business marketing budget for some type
of direct mail campaign.
About the Author
Jeffrey Dobkin, author of the incredible "How-To" step-by-step marketing books, How To Market A Product For Under $500!, and Uncommon Marketing Techniques, is a writer specializing in direct response sales letters and advertising packages. He now has a new program available: The Intelligent Testing System - How to succeed by placing tiny classified ads, and sending direct mail. Are you just 25-words away from being rich? You might be. Call for his free brochure: 1-866-AWESOME. Or call him directly at 610-642-1000. Be sure to visit (www.dobkin.com) for additional articles on direct marketing.
