Great Links

Welcome to this week's edition of the Blog Log! Here are our favorite links of the week. We hope you enjoy them!

1. Dana Blankenhorn: What Starbucks Can Learn from Barack Obama. This post resonated with me because for years, I could travel nowhere without knowing where the closest Starbucks was. Actually, that is still true. I am a true addict. As Dana points out, Starbucks has lost their customer focus, and I think it's because they have grown to be such a giant. Dana thinks that it's because they don't really focus on the customer relationship. And, he actually provides them pointers on how they could do a better job. In addition, he feels that they could learn a lot about CRM from watching Barack Obama and his flawless campaign of bringing people into the campaign and creating loyalists. This is a great and humorous read -- we think you'll enjoy it, too!

2. Bob Sullivan: Does it take a Recession to Shape Up Marketing Efforts? Hear, hear . . . is this recession a self-fulfilling prophecy? That's what I want to know. I was talking to a colleague this week and we were wondering this very thing. Everyone's talking about a slow down in marketing efforts and spend -- are we actually causing it to happen??? Let's all take a pledge to just stop it now -- just in case it's true! Bob makes a great point . . . he's seen some great tips out there on how to effectively plan your marketing strategy in case of an economic-slowdown. And they are all great tips. However, he asks a great question: "Shouldn’t marketers be performing all of these activities regardless of economics? Isn’t that just good marketing?" Once again, you're right, Bob!

3. Ted Grigg: How Do Consultants Establish their Daily or Hourly Rate? As usual, Ted figures out the equation for us. As consultants, we've been in the pickle of charging by the day/hour or by the project. I'm not sure about the rest of you but our clients normally want a per project charge simply because they don't want any surprises. Ted brings up so many good points in this article that I wanted to feature it today. It's great education for both consultants and their clients. Ted's approach to the equation is eye-opening for all parties. This is a great post.

We hope you enjoy all of our great links for this week. TGIF!

Mobile Marketing and the Presidential Race

If you've been tuning in to the already almost year-long Presidential race, you know that this one has been very different -- on many levels. Not only have we had a longer head-start to understand the various contenders, but we have also seen an unprecedented number of debates and other "media moments" thus far. And we still have almost 9 months to go before the election!

Direct marketers have definitely been involved in this process. And this time around, it's gone further than direct mail and telemarketing campaigns. Case in point . . . according to DM News today, mobile services firm, Mogreet, is jumping on the election bandwagon with a new free video text service. According to the article, “It's all about empowering young voters with a voice through the channel that they know best,” said James Citron, CEO of Mogreet. “The youth vote is very important in this election and using new media channels is the best way to reach a younger demographic.”

And, as we've seen thus far in the primary's and caucuses so far, there has been an unprecedented amount of involvement from America's youth. Mogreet has seized this opportunity by sending a mobile phone to each of the major presidential candi­date's new media managers. Those interested in the candidates viewpoints can go to http://www.mogreetthevote.com/, and "select from a series of 10- to 15-second videos, deemed Mogreets, on topics that include the economy, gay marriage, the Iraq War and global warming and send them to a candidate's mobile phone, with a personalized text message, for free. General consumer-to-consumer Mogreets cost 99 cents."

As you can imagine, Mogreet is doing this for more than just educating kids about the voting process. They are also educating them on their platform, and hope to create more awareness nationwide about their services. Since texting is most widely embraced by the youth market, this is a brilliant idea!

Results so far show that Barack Obama has received the most texts (37.5% of the 4,000 messages sent so far). Hillary Clinton has received 22.5%. The area of most interest so far is global warming.

What a wonderful idea! This is where creating awareness through social media and mobile marketing can come together to create a direct marketing success story. It will be fun to see how widely used this campaign becomes as we get closer to the election.

Intelligent E-Marketing Campaigns

E-mail marketing is definitely becoming the darling of all of the direct marketing channels. In the past, it was looked at with skepticism -- and e-marketers were oftentimes branded as spammers. We're happy to say that the world has finally caught up!

Many of us want to be contacted by e-mail. It's just easier than talking to someone or even opening up a piece of mail. Spam definitely is still an issue but most folks have either implemented excellent spam filters or are getting good at going through and getting rid of spam manually. All in all, when I get an e-marketing message that is relevant to me, I'm happy to read it -- and very likely to respond.

Case in point, last week K&L Wine Merchants sent me an e-marketing message regarding two great wine selections that they were featuring on sale. As an avid red wine drinker (ever wonder what RRW stands for--think UB40), both were big reds -- a Beaulieu Vineyards Tapestry Red and a Sterling Vineyards Cabernet. The price point was excellent -- so I ordered a half-case of each. The online shopping experience was excellent and I even got the chance to fill out a survey on my observations.

Apparently, K&L is very aware of the value of e-marketing. In fact, they've even taken steps to upgrade their e-marketing platform recently. According to DM News, "Online wine retailer K&L Wine Merchants has tapped e-mail marketing services firm StrongMail Systems Inc. in a move to increase its white listing and more easily manage its program." Apparently, their in-house system was harder to manage and resulted in a lot of blacklisting. This new solution will help with both of these problems. In addition, according to the article, it will help with campaign management and provides some robust reporting tools.

Brian Zucker, CTO and co-owner of K&L, wants to ensure that his customers receive offers that are relevant to their tastes (based upon previous orders) and that they always have the inventory on hand when the customer orders. Zucker states: “We always have to determine how many e-mails to send, because our products are not limitless,” Zucker added. “We have a new wine with only 500 cases made and so we have to determine who would probably respond to this wine and not oversend e-mails.”

Once again, this is music to our ears . . . sending relevant messages via the direct marketing channel that customers prefer, and ensuring that there's enough red, red wine to go around!

Cheers!

Direct Marketing Strategy: Data Mining

We talk about direct marketing strategy in just about every blog post. The reason why we do this is because we see so many marketers in a frenzied state -- just trying to get the campaigns out on time without fully thinking through how they will track and measure them on the back end. Therefore, this step never occurs, or occurs only as an afterthought. So, the value of it is diminished -- it becomes more of an exercise than a defined part of your overall strategy.

What to do about this? Well, we found an excellent article in MultiChannel Merchant today that gives you some excellent advice on how to integrate data mining into your strategy. The article, written by Rich Brough or Transcontinental Database Marketing in Toronto, provides his ideas on what he feels are "the six stages in the hierarchy of data analytics, and the value of each to a well-rounded strategic approach."

Brough emphasizes that the first thing that marketers need to employ is a consistent approach up-front to identify opportunities within the customer base. He argues that while this may take some time to put in place, the results will be well worth the effort. Therefore, he identifies these six stages for us to consider as part of building this framework:

1) Data access: This is the foundation on which marketers build by collecting all pertinent information about customers, including name, address, demographic data, history of transactions, product and service purchases, and responses to past campaigns. Every business should earmark the appropriate resources to ensure this data is as accurate and up-to-date as possible.

2) Reporting/profiling: Key performance indicators are developed and applied to track the performance of customer relationship management (CRM) initiatives over time and across customer segments. Here, marketers can also track client migrations across various segments, compare responders versus non-responders, and gauge campaign response over time.

3) Current value: The underlying premise for CRM is that not all customers provide equal value to an organization. Therefore, the first step for any CRM initiative is to measure customers by their value to the organization.

For example, 20% of clients might account for 80% of a company’s business, and would be worth a lot of the marketer’s time and money. Another 30% might be designated as moderately valuable, but having the potential to move up into the top 20%; they’d require a different kind of pitch.

The last 50% could account for just 5% of the company’s business; they are less committed, motivated largely by price, and require still another approach (or, maybe, none at all).

4) Segmentation: In this stage, marketers identify prospects who share similar characteristics – who, therefore, belong to one of several specific segments.

This provides the opportunity to focus on the highest-value segments and acquire new customers who match the segments identified as most desirable. As well, sales pitches can be custom-tailored to suit each segment using what is known about those segments. Customers can be segmented using many criteria.

But segments should focus on identifying customers with similar product and service needs as implied through neighborhood socio-demographic characteristics, life stage, usage behavior, or needs and attitudes as identified by market research.

5) Predictive analytics: Use this to predict each customer’s likelihood to initiate a particular activity in future based on their unique characteristics and past behavior.

The benefits represent a “win-win” for the organization and its customers, with marketing ROI rising, and customers receiving more relevant offers – the principle of “right message to the right customer.” Predictive models are developed to assist marketing at all stages of the customer lifecycle, including acquisition, cross-sell and up-sell, retention, and re-activation.

6) Potential value: This is assessed by combining each customer’s current value with their potential to buy more in the future. As with current value, potential value creates an even clearer way to identify the most valuable customers, the ones worth keeping.

It also helps to identify those less valuable customers with potential for entering the most-valuable category, and those low-value clients on whom it may not be necessary to spend as much.

I'm sure that you'll agree that this is excellent advice. As Brogh's states: "Using these six stages, marketers can develop a database-marketing strategic framework that differentiates customers based on the value they currently contribute to an organization, their product and service needs, and their potential future value." This is a much more strategic approach to direct marketing, and one that will have a positive impact on your ROI.

Let's face it, if we are consistently in a hurry in getting out our campaigns, we need to be as efficient as possible. This approach may take some time to set up at the beginning. However, as you move through time, your campaigns will take you less time to create, they'll be more responsive, you'll be targeting the most profitable customers, and you'll be able to demonstrate that your DM efforts are paying off -- in terms of bottom-line profitability.

Case Study Monday: World Vital Records

On of our business goals for 2008 is to include more social marketing strategies in our direct marketing tool-kit. Therefore, we’re always looking for success stories of marketers who have figured out how to use social marketing to grow their business. We were intrigued by this case study, published in its entirety on Marketing Sherpa.

Situation Overview

Paul Allen, CEO, World Vital Records, wanted to use social networking as the strategy to market his subscription-based genealogy research service. His team created their own social networking site, FamilyLink.com, last spring to help genealogists create family trees and connect with researchers around the world.

The Challenge

So how did he go about augmenting the FamilyLink network of approximately 30,000 registered users? Allen’s idea was to take advantage of Facebook’s 64 million active users. “Our own social network is growing slowly, and it’s going to be a big part of our future strategy, but Facebook is the biggest opportunity I’ve seen in 10 years on the Internet.”

The Solution and Results

When Facebook opened its platform to outside developers last year, Allen and his team moved quickly. In October, they launched a genealogy application for Facebook users called “We’re Related,” which lets people connect to their family members on the network and create family trees. To date, the application has been downloaded by 2.8 million Facebook members, and the activity within the application has doubled, making it the network’s #1 genealogy application.

Along the way, the team has been testing promotional methods, advertising strategies and lead-generation techniques to learn what role such social networking applications can play in their subscription marketing efforts. They’ve even begun developing co-branded applications with partner companies that want to offer family-related content and activities.

In Summary

World Vital Records was able to augment and rapidly grow its existing social marketing strategy by incorporating a cool Facebook application. By understanding the value that Facebook brought to their business, and by getting there quickly once they opened up their platform, World Vital Records was able to launch itself into the world of social media/marketing.

Check out the full article that concludes with eight tips from Allen on how to build a successful Facebook application and monitor its revenue- and lead generation capabilities. As direct marketers, we predict that this will continue to be a big part of our future!

Have a great week!

Blogs we Like!

Another great week for bloggers, and those who like to read blogs.

We'll start off by pointing you to this post from Customers Rock. Author Becky Carroll provides an excellent example of how companies can earn a customer for life, relaying a personal situation that involved her skateboarder son. Her post is just as interesting as was her luncheon presentation on Social Media made this week at the San Diego DMA (which Nancy was happy to attend).

While we're on the topic of customer service, check out this blog post from Marketing Shift, titled: Customer Service as Marketing Tool. It discusses Friendly Computer's strategy of marketing their excellent customer service as a differentiator. If they do, indeed, come through on their promise and deliver a great experience, I think that great customer service is definitely a selling point.

Greg Verdino posed this interesting question on his blog: "If we literally turned off all this social media / Web 2.0 stuff for a day would business productivity soar? And inversely, would innovation stumble?" The question started some quite interesting discussion. My opinion--if we turned it all off, we may get more work done in a day, but we'd sure have a lot less fun. And, we'd be a lot less creative.

For fun, I wanted to share this site where you can obtain up-to-the-minute astrological horoscopes--for your dog! Nancy found it in her ongoing quest to understand her two twin Pugs, Willie and Woody. This link points to Aquarius, the sign of my black lab, Chance (who had a birthday this week!). It's kinda surprising how accurate these can be...

Happy Friday! Enjoy your weekends.

Mortgage Companies Still Upbeat!

You're probably saying NO WAY! How can mortgage companies possibly be upbeat with the subprime fiasco and the demise of so many mortgage lenders?

Well, according to yesterday's New York Times article entitled, No Lull in Mortgage Pitches, these companies are continuing to pump out upbeat messages to encourage consumers to continue to pursue the American Dream of homeownership. Countrywide's ad, for example, touts that "Countrywide can show you the way home." Bank of America's ad: "Homeownership is the best medicine." In addition, the article reports that "the National Association of Realtors is running national television ads saying there has never been a better time to buy a home. Home values nearly double every 10 years, the commercial claims, showing a young couple walk up to their white colonial-style home."

For direct marketers like us who have spent the last few years serving this industry with targeted multi-channel marketing campaigns, this is music to our ears. Companies like CountryWide, Bank of America and Wachovia have not decreased their advertisements -- and we're hoping that increases in direct marketing budgets will follow suit . . . if it's true.

As mortgage experts predict a strong Spring for home buying, other experts are not so sure. “'There’s been huge scrutiny on these companies, but they are continuing to advertise,' said Sally Greenberg, executive director of the National Consumers League, a nonprofit organization in Washington. 'Many of these companies are bleeding, and these ads are a way to get more money into the door.'” Even the Mortgage Bankers Association is not predicting a strong year, according to the article.

It'll be interesting to see how this unfolds. The other outstanding factor is the fact that this is an election year. Both major political parties have made the mortgage crisis a major theme of their campaigns -- with a myriad of approaches for bailing out those Americans who got in over their heads in the past few years.

From this direct marketers optomistic perspective, I'm hoping that the economy will continue to correct itself, and that consumers have better learned to read carefully over the fine print on those mortgage loan documents. If the National Realtors Association is correct in their research, and home prices do nearly double each decade, perhaps this will help to spur the economy in the right direction and get the direct marketing dollars flowing again in this industry! We're keeping our fingers crossed.

Improve Customer Satisfaction

From today's "DM News": Customer satisfaction down again

"Overall customer satisfaction declined in the fourth quarter of 2007, marking two subsequent quarters in which a decline was posted, according to the American Customer Satisfaction Index, released today by the University of Michigan.

In the fourth quarter, the index fell to 74.9 on the ACSI's 100-point scale, down 0.4% from the previous quarter. This news, combined with increasing unemployment, declining house prices, tighter credit, high levels of household debt and rising fuel and food prices is likely to pose challenges this quarter for consumer spending growth, according to the ACSI."

Here's the question I pose today: Is customer service related to the economy? Will, as the article contends, low customer satisfaction equate to less consumer spending?

If so, then it's critical that companies get focused on their customer. Today--not tomorrow.

I'm a firm believer that we can do lots to improve the customer experience, even without spending an enormous amount of money. A couple of no/low cost ideas come to mind:

1. Empower your front-line employees to solve problems. Let cashiers, for example, extend a small discount if a customer wants to buy slightly damaged merchandise. Let the customer service rep extend the web discount, even if the prospective customer called in for service. By empowering the people who talk to your customers, you're solving a problem quickly, making your customer and your employee feel more valued--and those are always keys to satisfaction.
2. Mine your customer database to understand exactly who ARE your most valuable customers. Whether it's in terms of longevity (how long they've been with you) or how much they've spent or how often they buy, make sure you have a handle on just who are your best customers. Then, when you have a handle on this metric, make sure you treat these folks with extra special service. These are the people you definitely don't want to defect to your competitor. So, implement programs designed to show these high-value customers that you care.

We believe that it's always important to keep customers happy. In these crazy economic times, it's crucial.

Smarter Marketing: Using Modeling to Improve Direct Marketing Success

By now, you probably know that we are huge proponents of utilizing an analytical approach to direct marketing. As a matter of fact, our clients have told us that this is the core competency that sets us apart from our competitors. As such, we love it when someone has come up with a new analytical idea that assists direct marketers in more effectively reaching a specific audience.

DM News reports today that TransUnion and Edgar, Dunn and Company have come up with such an idea, and have built a model that is currently in the testing phase with one of their largest customers to do just that -- help credit card companies more effectively target consumer revolving credit card users. According the the article "The Revolver Model is marketed primarily to credit card issuers, banks and other financial institutions that issue credit cards. It shows consumer preferences on managing credit card balances, credit card use and use of other forms of payment, such as debit cards and cash, and is intended to help card issuers manage and segment product portfolios and focus offers to new and upgrading customers."

We've all seen credit models used before for prescreening potential consumers -- particularly in the financial services market. This one is a bit different in that it looks specifically at the consumer -- as opposed to past behavior data from a single card issuer. In looking at all of the credit cards that a consumer utilizes, you can really determine their spending behavior, how open they are to revolving debt and how they use cards over time. As Beth Costa, director at Edgar, Dunn and Company states: "“The Revolver model gives a holistic view of the wallet and can bring in what is the consumer's attitude towards revolving balances and rewards, and how they use debit cards, cash, checks and the whole equation.” Pretty darn nifty!

The article reports that this model was built on a survey of more than 10,000 consumers that the two companies conducted in 2007. It will be interesting to see how effective this analytical tool works for the financial services market.

As you plan your direct marketing campaigns, we urge you to consider utilizing an analytical approach. Put simply, integrating analytical intelligence with your DM campaigns will make each campaign much more successful -- both in the present and in the future. We've written an Analytical Workbook that may be of interest to you if you're heading down this path. Let us know if you'd like a copy and we'll be happy to send it your way.

Case Study Monday: B2B Database Marketing

We wanted to share today's case study because it illustrates how vital the company database can be. Sure, most direct marketers understand the importance of database marketing when we're talking about companies with hundreds of thousands of customers (think financial services or telecommunications firms). We liked this case study because it is all about maximizing customer data in an industry where the database is not typically considered a huge asset.

Industrial products firm, Lawson Products, realized success when they turned their focus on the customer, all enabled by their new focus on database marketing.

By the way, this article, in its entirety can be found in BtoB Online.

Company Background
Lawson Products sells and distributes a huge number of products—including screws, rivets and related fasteners—to the aerospace, agricultural, automotive, construction and transportation industries.

The company's 2007 sales of about $520 million was virtually unchanged from 2006. Revenue growth excluding acquisitions has been fairly slight since 2002. Further, because of its reliance on a huge but independent sales chain, the company found it had little ability to analyze customer data or track the results of its marketing efforts.

The Problem
"This is a family-owned business, and has been doing business successfully for a long time," said Lisa Kaplan, VP-corporate marketing at Lawson. "But it needed to change to keep up with the competitive set. So people like myself were brought on board to begin touching customers in a way we hadn't before."

The company, which relies on a channel of 1,600 independent reps, had no "actionable information," Kaplan said. Prior to her arrival five years ago, Lawson had no marketing department at all.

The Solution
Lawson turned to marketing firm Extraprise, whose main product, called i2i, is a conglomeration of commercially available software tools packaged under a common user interface. For Lawson, Extraprise put together a platform that at its core consisted of Microsoft's SQL Server database. In addition, Extraprise used a database cleansing tool from Firstlogic to make sure the flow of contact information into SQL Server was as accurate as possible.

To examine the newly cleaned data and formulate campaigns, Extraprise then added a database analytics system by Alterian. Another tool, already used in-house by Lawson, is a reporting and dashboard package by WebFocus. The whole process is supported by Extraprise's ongoing consulting services.

"Lawson didn't have many systems and processes defined around marketing," said Chris Baribeau, an Extraprise marketing strategist. "Our first challenge was collecting the data, putting it in a form to support Lawson's marketing needs." Baribeau said that Lawson had about 15 different databases companywide, such as Excel spreadsheets, Access files and mailing lists. All were dumped into SQL Server, cleansed by Firstlogic and examined by the Alterian application.

Kaplan said the initial task for the Alterian analytics tool was life cycle marketing, focusing on customer retention. "We had a lot of churn," she said. "We're attacking pockets of the business, and we'll see more this year. But already we're doing a better job of acquisition, penetration and retaining [at-risk] customers."

One big initial surprise from the effort, Baribeau said, was recognizing that customers tend to become inactive much more quickly than originally estimated. "After testing, we found you don't have a lot of time before a customer is inactive and must be treated as a win-back situation," he said.

Results
Because the program is only a little over a year old, the effort's ROI is still a bit vague, Kaplan said.

"The process has given us good direction on where to point, to make refinements," she said. "For the future, we're trying to drive more volume through the tool with greater impact."

However, the process has enabled Lawson to better identify its best potential customers; best products and specific pricing; and ideal industries and customers. Analytics, in turn, is helping predict attrition, as well as life cycle, segment and product marketing, as well as lay the groundwork for improvement in each area.

Great Links!

Welcome to another edition of the Friday Blog Log! Here are our favorite links of the week. We hope you enjoy them as much as we did!

To start off, we loved this post from the Email Marketing Feed blog. This is a blog that collects all things e-mail marketing and reports it to the world. imediaconnection.com is the author of this particular post and they do a good job of discussing how to create e-mail messages that take into account the user experience when receiving the message. Oftentimes, as we create our e-mail messages, we focus primarily on the content, the offer and the target market. This is all very important, too. However, this post talks to the importance of conducting some simple usability studies that take mere hours to increase the open and response rates of your message. This post gives some examples of how to integrate this into every campaign. It's jam-packed with great information!

Our second link comes from e-consultancy's News and Blog post on Forrester's recent research on how spending lots of money on social media can sustain companies in these tough economic times. e-consultancy's author rips this research apart and provides some great (and pretty humorous) examples of why this isn't such a great idea. Here's a snippet from the article: "Given the fact that it’s increasingly becoming clear that marketing on social networks for the vast majority of marketers who have tried it, and is losing money for even the Googles of this world, Forrester Research’s 'research' seems to be quite contrarian to say the least." Read the full article for some thought-provoking ideas around this important subject -- and what this author's ideas are on what's really important. Good stuff!

Finally, we loved this post from Ron Shevlin's Marketing Whims Blog. In this post, Ron dispels the myth that you can advertise your way to greatness. With his tell-tale humor, he discusses the real elements that create iconic companies. Ron points out that Nike and Apple have accomplished this because they have done things in addition to advertising that helped them achieve their iconic status. "In Apple’s case it’s customers who are really into computer-aided graphics and design, and in Nike’s case it’s athletes and aspiring athletes." This is a wonderful and humorous read on what makes great companies just that -- great companies. And, under no circumstances can you become great simply by building a great advertising campaign. We know you'll enjoy this one!

TGIF!

We Love Event Triggers!

I'll start by apologizing for the gratuitous heart pic and the "Love" in the headline. But, hey, come on--it's Valentine's Day!

And, we DO love event triggers, primarily because of how they typically boost response rates of our clients' direct marketing campaigns.

So, what are we talking about here?

We define Event Triggers as changes that happen in your customers' lives that impact how they might want to transact business with you. As a marketer, if you can develop an understanding of these life event triggers, you can exploit that knowledge by offering your customer the product or service that she needs at that specific point-in-time. A powerful concept. When done right, the marketer will see a huge lift in ROI for a trigger-based campaign, and they'll best serve their customer by anticipating their needs.

I enjoyed this article from DMN Directives, a Canadian forum on data-driven marketing strategies. Authored by Rick Makos, the President of Teradata in Canada, the article explains Event Triggering as a concept, with a technology perspective. It talks about how current database technology can sift through customer transactions to identify the event triggers.

To help you visualize what we mean by event triggers, here's a list of examples from the article:

Changes in a customer’s routine banking or interaction behavior, credit card applications, deposits, transactions

Calls or contact from a customer about products, services, or need for information

In the travel businesses, sudden changes to flight schedules that affect customers’ patterns in travel booking that signal opportunities to alter arrangements

For telecommunications, patterns of service disruptions or changes in phone activity or billing amounts that may signal a need to upgrade or modify service agreements – or offer other services

Name changes, address changes, date-driven or apparent lifestyle changes

Product or service purchases that may trigger complementary items, services, and upgrades or up-sell offers – or achieving predetermined customer ‘status’"

Think about how the above customer-initiated transactions can spark a reaction from you, the marketer. If done right, you can react to your customer changes with a thoughtful new offer, a better service plan, etc. Your customer will be happy that you're meeting their new needs, hence adding increased loyalty to the increased profits you'll have generated. A win-win.

In addition to the above triggers that are generated from your internal customer database, we've used external, purchased triggers very successfully.

An RRW Example:

In the height of a competitive mortgage market (oh, those were good days...), we submitted a file of qualified homeowner prospects to one of the three consumer credit bureaus on behalf of our client, a high-volume direct marketer of refinance and home equity loans. Each day, the credit bureau would cull through that prospect list to see if any of the homeowner prospects had applied for a mortgage with another, competing firm.

If so, the prospect would immediately be sent over to the client, who would then contact the homeowner with an excellent loan offer. This strategy worked like magic; response, sales and conversion rates went through the roof. As we all know, the home loan process can take quite a bit of time, so it's not too hard to reach the homeowner who we now KNOW is shopping for a new mortgage in time to get them to consider our offer.

The credit bureaus offer similar triggers for the automotive industry and others. What better time to reach your prospective buyer when you know they're shopping? Pretty cool, eh?

Other life events to look for in a prospecting environment could include:

• Milestone birthday (or any birthday if you're a restaurant)
  
• Upcoming marriage
• Recent divorce (hard to talk about on V-Day!)
• Recent move (new movers buy SO much stuff!)
• New baby in the household

I think you're getting the picture--there are many things that change the lives of our customers and prospects. If you can understand those life changing events and then meet their new needs with some solid products and services, you'll have a successful direct marketing program.

CRM Delivered Via Software-as-a-Service Solutions

HA! We've come across yet another direct marketing term and acronym -- SaaS (AKA Software-as-a-Service). What this term describes is the increased ability for companies to deliver CRM to their global workforce via flexible software that can be utilized by large numbers of users in different places. As companies expand and their product/service offerings are extended, this becomes increasingly important for both sales, marketing and -- most importantly -- customer satisfaction.

A recent press release reports on a survey conducted by the Aberdeen Group (a Harte-Hanks company). It reports that "the top pressure causing all organizations to focus resources on SaaS as a CRM delivery method is the need to provide access to account information anywhere to an increasingly mobile and global workforce." The survey reported that "Best-in-Class companies indicated that they currently blend organizational capabilities, such as the ability to provide remote access to employees (95%) and CRM security processes (57%), with technology deployment to positively affect the productivity of sales reps, while reducing the IT constraints that would accompany an on-premise solution.

There have been some excellent results reported when SaaS is utilized in these "Best-In-Class" companies. The press release reports that these companies "have reduced Time-to-Close 30% more than Laggards" (those not currently using this approach). An additional benefit is also reported: "71% of Best-in-Class companies integrate lead management technology with a CRM solution to provide increased visibility into the sales pipeline."

From our perspective, SaaS is enabling real Customer Relationship Management. This occurs when the firm's stakeholders (Leadership, IT, Marketing, and Sales) are all able to successfully manage the customer relationship from wherever they happen to be. This is an efficient way for sales to input all of the intelligence that they glean from their customer interactions -- and a great way for Leadership to manage to corporate revenue objectives.

You can obtain a full copy of this report from the Aberdeen Group. And, congratulations to them for putting this research together. Over time, it seems as though when companies invested in CRM systems, many have been stymied as to how to actually get the various divisions to accurately utilize the technology. We have seen situations where -- after a huge investment -- it is extremely difficult to learn how to use CRM tools, and that there is sometimes very little trust in the data that comes out of them. Furthermore, it takes a further investment of both time and money to get everyone on the same page.

Have any of you had any success stories at your companies using SaaS? We'd love to hear them!

Quick and Easy (and On-Target) E-mail Guidelines

Like most people, I like receiving my information in easy-to-digest portions. Sadly, when the information is digest-able, it typically doesn't have all that much value.

That definitely is NOT the case with this article: The 7.5 rules of e-mail marketing

If you dabble in e-mail marketing, even if it's just to send out a corporate newsletter, this DM News article will provide insight on how to improve your program. And, even if you're a high-volume, experienced e-mailer, I think you'll benefit from a quick read.

The author provides tips on how to ensure your e-mail program is a success. The last 1/2 of a tip is actually a reiteration of an earlier tip that the author considers critical. I'll spoil the suspense and share this tip, which was worth mentioning twice. The tip: Get Delivered.

From the article:

"Get delivered. Keep your e-mail file size small — around 40K is recommended. Avoid spam-trigger words like “sale”, “free” and “offer”. Limit use of images, which can raise your spam score. Include a physical address and an “unsubscribe” link. It's crucial to remain Can-Spam Act compliant and avoid blacklisting risks."

The other 6 tips:

1. Get a plan: Develop a long-term e-mail strategy. Think about a progression of e-mail messages to engage your customers and prospects.
   
2. Get help: Invest in outside consultants and/or technology to help ensure success.
   
3. Get read: By keeping your message and design simple.
   
4. Get it together: Integrate your online and offline campaigns. Take advantage of the multi-channel effect.
   
5. Get feedback: Encourage response via links, surveys and forms. Give something of value away to solicit reader feedback, and to generate leads.
   
6. Get results: Track deliveries, bounces, opens, click-throughs, forwards, and act on those results.

Are there any other tricks you have up your sleeve that weren't included in this article? One that comes to my mind is a tip around ensuring that you've targeted and segmented your audience so that your message is delivered to the exact right group of customers and prospects (hence making it less SPAMMY and more apt to be responded to).

Any other good e-mail tips out there?

Case Study Monday: Hay House and Lyris

Welcome to another edition of Case Study Monday. This week, we are featuring e-mail marketing specialists Lyris Technologies and their client, Hay House. We hope you enjoy their success story as much as we did!

Company Background
Hay House publishing was launched in 1984 by Louise Hay with the printing of her seminal book entitled, “You Can Heal Your Life.” The book, a collection of affirmation philosophies written to support people with AIDS, was sold initially via word of mouth. It eventually made it to the New York Times bestsellers list where it remained for 12 weeks. To date, the little blue book (as it became known) has sold over 42 million copies. Thus, Hay House was borne along with the entire genre of Self Help titles, now one of the biggest-selling sections in most bookstores. Today, Hay House publishes more than 300 books and 450 audio titles on health,
spirituality, and self-improvement, and this year they expect to gross over $80 million in sales.

Hay House reached another milestone in March of 2006, when it had not one, not two, but four titles on the New York Times bestseller list at the same time. Along with the little blue book,
Louise Hay’s foray into self help also came about through an event she organized: the Hayride—literally a hayride for people suffering from AIDS. This event was more than just a fun
outing. It was a support group that promoted the concept of healing yourself and loving yourself. And it is this message which is the foundation for everything Hay House does.

Goals and Challenges
In 2003, Hay House relaunched its main website focusing on e-commerce to market their books and other products and also provide information about events. In 2004, Hay House wanted to begin doing email marketing, having established a strong web presence. That year, Hay House hired Roberta Grace, Internet Marketing Specialist, to manage their email and other online marketing. They needed an email solution provider that they could bring in-house to help them increase their email lists and improve their market presence. Grace started to look for a service that could accommodate all their needs, and she evaluated and even tested quite a number of email vendors. She recalls that, “Lyris seemed to be the most professional, had the best tech support, and seemed to be the one that had the best white-listing program. That was one of the key reasons to choose Lyris; I needed to know that if I was sending out thousands of emails, they wouldn’t end up in spam folders. That’s just a waste of time. So, I picked Lyris and our email lists have grown exponentially ever since. It’s amazing the difference! We’ve been really happy with Lyris.”

In the past year, Hay House has seen their list size increase by 11%, and since they began with Lyris, their list size has increased 200%! In early 2006, they also launched Hay House radio, an online audio program of hosts, many of whom are Hay House authors. It’s become an important email marketing tool, on par with the Hay House commerce site, and the two sites compliment each other very nicely. Emails are collected on the home page via a weekly newsletter that provides a detailed radio guide for the week. Subscribers to the newsletter can also opt-in to other Hay House emails and lists.

New Ventures
For Hay House, email marketing takes many forms. For example, Hay House sponsors events
for their authors, for which they sell tickets. These events are marketed through email, TV, and
radio and are proving to be very successful. And of course, Hay House provides their books for
sale at these events. They also send follow-up emails to the people that come to their
events and conferences, directing them to specials and discounts. And recently, they’ve begun to
manage their authors’ emails lists for them, becoming more of a full-service publisher.

Email is really a huge part of Hay House’s business. And they are finding that the more they are able to integrate their email campaigns with the other marketing they do, the more successful they’ve become.

The numbers tell the story: in just the last two quarters, Hay House’s average daily sales volume has increased by 20%. For Hay House, they see their email program as a way for them to have human contact with their members. Many of their authors have their own very strong following, and they stay in touch with their readers via newsletters. These are very successful. Hay House’s monthly newsletter is beautifully produced in HTML and includes excerpts from the authors’ books—usually very compassionate and inspirational pieces. Grace knows that people genuinely appreciate receiving these because oftentimes, people will actually reply back to the outbound mailbox with comments like “this really made my day – I loved getting this note from you.” For Hay House, this is just the kind of marketing they want to do --soft marketing that will build their business and at the same time provide meaningful content to their readers and email subscribers.

Great Links!

Welcome to another edition of our Friday Blog Log!

The first link that we're featuring today is from Jesse Sands, of RoughStock Studios Blog. Jesse's blog post on Recession-Proof Marketing is a good read. We like Jesse's style! She discusses how to look at direct marketing spend in the time of an economic downturn. She brings up some great points for us to use in consulting with our clients, as well as for an internal look at our own businesses.

Staying on the same theme, take a look at Peter Kim's link that discusses why it may be difficult to make Mobile Marketing work -- particularly in this time of economic downturn. Peter is blogging from a recent OMMA Mobile Conference. Like Social Media was, Mobile Marketing is now in the beginning stages of marketer acceptance and use. There are some good reasons for this, as Peter outlines in his post. The good news is that he is also conducting some research on how to make Mobile Marketing work for you -- even in these turbulent economic times. So, we'll keep our eyes out for that more positive piece and feature it on an upcoming post.

Finally, we invite you to take a look at this link from the CRMIndustry.com Blog. This post discusses a recent survey that reports on how high-value customers are now requiring a seamless cross-channel experience. "The survey, which polled 1,005 adults between January 18 and 20, 2008, found that nearly two-thirds (64%) of all respondents went online before making a purchase in the past three months. That percentage was even higher for 'high-value' consumers, such as those with household incomes of about $75,000 (81%), college graduates (78%) and consumers age 25 to 34 (77%)." Take a look at the link for the full readout. Once again, this proves that as direct marketers we must become experts in creating a cross-channel experience that is transparent -- and relevant-- for our clients. For example, they must be able to effectively navigate your web site, then take that insight to the retail outlet to make purchases.

It's always good to end on a positive note! We hope you enjoy these links as much as we did.

TGIF!

Decline in Credit Card Mail Volume

Direct Magazine reports today: Subprime Woes Cause Credit Card Mail Decline.

"Credit card direct mail volume declined during the fourth quarter, as issuers were strained from the fallout of the subprime mortgage crisis and unsure about the economy, according to Synovate."

Well, this news comes as no surprise, right? Card issuers rely on consumer credit data from the credit bureaus to make decisions as to who is pre-approved for their card. And, typically, the sweet spot, the perfect target, are those consumers who are a tad stretched financially, hence have a need for more credit. Yet, that consumer still must have the ability to pay their monthly bills.

As more and more consumers are stretched to the point where they can no longer even pay their mortgage, there are fewer qualified (and needy) consumers to market credit cards to.

But, don't feel too sorry for the credit card companies...

I was floored by this fact from the article: "Overall credit card mail volume for the year was 5.2 billion, down almost 10% from 5.8 billion in the previous year."

OK, that's 5.2 BILLION pieces of mail!

I've been in the direct mail business for a long time. Yet, these types of numbers continue to astound me. I know that the credit card issuers employ lots of smart marketers who have the targeting down to a science. Yet, I can't help but think that this mail volume could be reduced significantly. Any ideas?

Direct Marketing Skills Still Valued

In these turbulent economic times, it's refreshing to see some good news for our industry. It seems that the core skills of database marketing and analytics continue to be valued by employers. From BtoB Online's Daily Report:

"Two-thirds of marketers (67%) says resources for database and analytics to support online marketing efforts call for the most marketing investment this year, according to Alterian, an enterprise marketing company, which released the results of its fifth annual marketing survey on Tuesday."

Interesting that this survey calls out "online" marketing, but we'll take that! Database marketing and analytics expertise are definitely transferable.

We challenge direct marketers to think outside the box and consider how your skills can apply to many different areas of marketing. Even if you've only had specific experience in, say, direct mail, so many of the disciplines you use can be translated to online marketing. And, if that is where companies are investing, then it might be a good idea to highlight your resume with examples of how your skills can improve online programs.

Here are a couple of examples that come to mind immediately:

1. Apply segmentation strategies to e-mail campaigns. While e-mail remains an inexpensive channel, it's no longer good enough to blast the same message to your entire list (and then do it over and over and over again). Increasingly, e-mail marketers are segmenting their customer and prospect lists and presenting the appropriate offer and message. They're starting to understand the importance of understanding how frequency impacts results. Who better than traditional direct marketers (who may only have segmented a postal mailing list so far) to teach e-mail marketers how to mine their database and understand customer segments?
2. Use ROI techniques to understand and measure the effectiveness of social media campaigns. Like database and analytics, social media is another area that corporations believe that they need to invest in (or miss the boat). As a leader in using numbers and results to justify your direct marketing spending, take those skills over to the world of social marketing. Attempt to quantify every investment (even if it's only the costs of someone's time taken to blog, for instance). Articulate to senior management, for example, how your social marketing efforts are targeting your market with pinpoint precision. Simply take your deep understanding of building your ROI for each campaign/program to the world of social marketing, and you'll be ahead of most of your competitors.

The above are only two examples of how you can migrate your direct marketing expertise to other, potentially more high-growth, areas within your organization.

Think about where your specific skills can apply (or have applied) to high-growth online marketing initiatives. And, please, share them here!

Customer Data Management is Good for the Environment!

Green marketing and direct mail seems like an oxymoron. I don't know about you, but I still get a ton of direct mail (and I love it, as you know). As an environmentally-minded person who is involved in direct marketing, nothing makes me madder than direct marketers who over-mail for no good reason. Case in point: My husband fancies a tall-person's retailer, Rochester's Big and Tall. Therefore, I normally purchase clothes for him from these folks. I love getting their catalogs, particularly around the various holidays. However, not only do I get a catalog from them at my home address, my husband gets his very own copy at our home address, and I get a third copy at our post office box. Now, being a good direct mail steward, I have contacted Rochester's to tell them that we really only need one catalog -- not three. I just called them again (because I just received more catalogs -- hence the rant), and I'll let you know if it works this time around. Grrr.

So, what's my point? Not only does it make good business sense to be green, it also makes for better customer relationships. Green marketing is about more effective data management -- that's it in a nutshell. There are businesses and consumers out there who love to receive direct mail -- they want to be communicated with in this fashion. The key is to identify them and communicate with them more efficiently.

In an article from Multi-Channel Merchant, appropriately entitled "Is Your Data Green," author Jeff Zabin stresses this point. "Each year, more than 100 million trees are destroyed, three million cars’ worth of energy is consumed and reprehensible-by-any-measure amounts of greenhouse gas is emitted into the atmosphere—all in the name of producing, distributing and disposing of direct mail solicitations." Yikes! That really drives the point home.

But there is also some good news. Zabin notes that some of the largest retailers, such as Office Depot, is taking steps towards greener direct marketing. "For its part, Office Depot has adopted a number of database marketing practices and technologies to help eliminate duplicate and returned catalogs, including a real-time customer data integration solution. The solution combines transaction data with advanced analytics to enable employees at the point-of-sale to cross-sell and up-sell in a more effective manner. It also allows Office Depot to know which (and how many) direct mail offers and catalogs to send to which customers—and when—to maximize revenues while minimizing both costs and environmental waste."

This is an excellent example of utilizing intelligent data management tools to increase Office Depot's ROI and increase customer satisfaction. While this example utilizes real-time customer integration techniques, there are also lower-tech data management tools that can increase your efficiency. We have clients who have simply added in old-fashioned address hygiene tools and effectively decreased the amount of returned mail that they had been receiving. In addition, there are many companies out there who don't update their data as often as they need to. So, you can go as high or low-tech as your particular business needs dictate. The important thing to remember is that what you do impacts both your profitability and helps to cut down on your carbon footprint. It's a win-win scenario.

Zabin is so passionate about this, he is in the process of creating a benchmark report “Green Marketing: Leveraging Customer Data to Reduce Environmental Waste" for his company the Aberdeen Group. According to Zabin, "The goal of the report is to further educate the marketplace about the value of customer data management from a green marketing perspective." We applaud Zabin and the Aberdeen Group for bringing greater focus to this area. We've also written a handy white paper on Effective Customer Data Management if you're interested in learning more about the different types of data management tools available for you to use in your businesses.

Once again, it IS easy to be Green!

Case Study Monday: InfoCentricity and First National Bank of Omaha

As you know, we are firm believers in the power of data and analytics. When direct marketing professionals are able to use technology to improve performance, I love hearing about it. We hope you do, too :)

Here's a success story from InfoCentricity, an analytic solutions company that helps companies discover and leverage key insights hidden in their data. Their software, Xeno, helps direct marketers and risk management professionals build predictive models, perform profiling and create clustering solutions.

First National Bank Investing Successfully in Predictive Analytic Initiatives

In a recent marketing campaign, the bank achieved a 10 percent increase in net response rates using prediction scores developed with InfoCentricity's Xeno.

With over $17 billion in managed assets and over 7,500 employees, First National Bank of Omaha ranks as one of the fifty largest banks in the U.S. First National is the fifth-largest in-house credit card processor, the seventh-largest merchant processor, a top-ten commercial card issuer and the eleventh-largest issuer of bank cards in the United States.

The Challenge

First National's card division is growing fast. With close to two million active customers in the credit card division alone, successfully managing and retaining its current customers, as well as intelligently reaching out to new customer prospects, is an ever-increasing challenge.

Needle in the 10 Terabyte Haystack

According to Vice President Mihaela Kobjerowski, who manages the bank's Decision Science group working with the credit card divisions building predictive models to help determine who to market to, who to extend credit to--and how much--is also becoming more difficult.

Analysts sift through more than 10 terabytes of information dating back 10 years to find specific nuggets of information that might suggest trends. In addition to the rapidly growing customer database, credit card customers often post multiple transactions per day. Plus, the bank further enriches its data warehouse by regularly purchasing third party credit bureau and demographic data.

Prior to incorporating InfoCentricity's Xeno predictive modeling tool into their analytic environment, most of the bank's model development work was done in SAS. "We are a heavy user of SAS, but in the predictive analytics area we found that a significant amount of our analysts' time was being spent on coding, instead of analyzing what the data was telling them," Kobjerowski said. "Using Xeno we are able to do modeling that we were not previously able to do at the same level of detail, and then download the Xeno code seamlessly into SAS. A very powerful solution."

So, what did all that number crunching get them?

The Results

First National added a substantial number of new credit card accounts in 2006, the success of which can easily be associated with the efforts of the Decision Science group. The company's annualized growth rate in the last quarter was in double digits--well above the industry average. In the new account acquisition program alone, the group has more than 100,000 tests from 2006 alone to read and model. "Xeno provides a very robust tool to get insight into so much data," Kobjerowski said.

Kobjerowski said a recently completed model development project for marketing showed the performance of the score improved by as much as 30 percent through new development work using Xeno. That translated to a 10 percent increase in net response rates for a large marketing campaign, while also increasing approval rates. "That is huge in our world," Kobjerowski said.

Well, it's huge in our world, too!

Kudos to First National Bank of Omaha and their technology partner, InfoCentricity.

Some Excellent Links

The first mention--this well-written post by Ann Handley. What a story teller! With her re-cap of a recent volunteering experience, she brings the concept of people working best when they fully understand their roles in the workplace to life. Not our normal marketing blog, but very insightful and a fun read!

And, because it's so topical, we thought you'd be interested in this post from the Seeking Alpha blog. Author, Erick Schonfeld, provides an interesting analysis that shows how the combined Microsoft/Yahoo compares to Google, financially speaking.

At the end of a long, hard work-week, this post from Advertising for Peanuts, Being Tough, hit home. While not always obvious to people who might have more physically grueling careers, those of us in marketing ARE some pretty tough cookies! We deal with deadlines, demanding clients, travel and lots of stress. This post recognizes it, and I enjoyed it.

Finally, if you simply can't wait until Sunday's main event--you know--the Super Bowl advertisements, the Adland blog has archived several for your viewing pleasure.

Enjoy your weekend, and the big game!