Churn is a Problem for Sprint

It's official. Sprint definitely has customer service issues. Remember the brouhaha in July when Sprint publicly 'fired' some of its high-maintenance customers? Well, we find Sprint in the news again trying to stem their higher-than-industry-average churn rate.

From CRM Buyer: Sprint to Bandage Bleeding Customer Lists by Adding Service Reps

"Sprint Nextel's churn rate -- the rate of customers who jump ship and sign on to rival networks -- has shrunk over the last quarter, but it's still nearly twice as bad as Verizon's. It's a problem that contributed to the recent ouster of CEO Gary Forsee. To cut churn and keep more customers onboard, Sprint plans to hire 150 additional customer service reps."

It will be interesting to see if throwing more bodies at the problem will be effective. While it certainly won't hurt to cut the hold time when customers call into customer service, I'm hoping that Sprint Nextel is looking at their retention issue more holistically.

Are they asking themselves key questions such as:

• What are my competitors (namely Verizon Wireless whose churn rate is 1/2 that of Sprints') doing that I'm not?
• Is it our network?
• How do price-plans compare?
• What about our phones--are they as 'cool', or innovative as our competition?
• How did the negative press generated from the recent customer firing incident impact churn?

Of course, there are teams of bright people at Sprint asking these questions. The real question is--will they find the answers they need to continue to grow and compete with Verizon. I guess we'll all sit back, wait and watch.

Gosh, I bet the folks from the old Nextel who survived that merger are wondering what happened to the good old days when their churn rate was significantly lower than the industry and their Average Revenue per Unit (ARPU) was significantly higher. Perhaps the best question Sprint should be asking is: How do we get back to THOSE 'glory' days?

Bill Gates is King--even of Direct Marketing...

I promise, this is the LAST post with DMA conference news. You won't hear about the annual direct marketing conference from us until next year.

The Direct Marketing Association this week announced their marketer of the year. Yep, it's Microsoft.

DMA Names Microsoft-MSN 2007 Marketer of the Year

The main reason for MSN's win--their work on the Live Earth concert event (which we also blogged about in July). From the article:

"What made Live Earth so special on July 7, 2007, wasn’t just that MSN provided great content to consumers in a relevant, timely, and informative manner. Live Earth was the largest concert event ever produced — bringing together live music events in Australia, Brazil, Germany, Japan, South Africa, Turkey, the UK, and the US. Live Earth was also the most watched live entertainment event in Internet history. But what really sets it apart is that MSN completed its mission of keeping the public engaged on the network by providing avenues for them to act on that information.

Greco pointed out that, in addition to demonstrating marketing leadership, innovation, and responsibility, DMA Marketer of the Year nominees also needed to display a pattern of consistent contribution to the multichannel marketing profession, as well a high level of competence in one or more disciplines, such as product development, research, marketing, management, education, sales, administration, or technological innovation."

Past winners of this award have included more traditional direct mailers such as Columbia House, Readers Digest, LL Bean and Fingerhut. I tend to applaud the DMA for attempting to expand their definition of DM to include interactive and other multi-channel marketing.

Another win of note, announced just yesterday: Draftfcb's win of the Diamond Echo Award (the highest honor for direct response advertising). They won it on behalf of their non-profit work performed for the Eagle Idaho Volunteer Fire Department. The campaign was titled "Have a Ball or Two" and advertised a charity event benefiting the fire department, the Rocky Mountain Oyster Feed. Enough said...

Overall, the DMA was exhausting, fun and productive for RRW. It was great to connect with clients, business associates and meet some new folks. With that said, it sure is good to be home. Believe me, it will take a full year to recover from Chicago and get ready for next years' show, to be held in Las Vegas.

How to Throw a Party

Too much DMA madness! Too many parties, too many free drinks, too many people that you haven't seen for years that you need to catch up with. But, as always, there's a lesson to be learned :)

And, that is--make every dollar count.

So far this conference, we've had the pleasure of attending many parties thrown by the small and the large firms that we do business with. The common themes: generous open bars, nice settings, gracious people trying to facilitate business discussions or thank their customers/partners for business enjoyed throughout the year.

And, then we attended the party to end all parties! Hosted by Direct Group, they threw a shindig I'll never forget! We were greeted outside of the W Hotel lobby by gorgeous hosts and hostesses dressed in full evening get-up. It truly felt like red-carpet treatment. We were handed a martini immediately and personally escorted to the elevator and up to the penthouse ballroom where the party was held.

Once inside, the first person we saw (gasp) was Jerry Rice (you know -- the greatest wide-receiver ever)! He was there to sign autographs, dance a little, and generally be a cool guy to hang with. We had many pictures taken with this Super Bowl stud and we were promised an autographed football to be sent to us along with our photos. We then see the glittery dance floor, filled with silvery-dressed Dancing with the Stars types.

There was an awesome dessert buffet and a great bar. The Direct Group team went out of their way to greet and mingle with guests. Attention was paid to the detail, such as their logo burning in candles in the sand at the beach on the lake across the street from the W.

OK, so why am I gushing about this party. First off--JERRY RICE! No, seriously. This party stood out because they went the extra mile. Not just with expenses--all of those parties cost a pretty penny. It's just the attention to detail that they paid and the focus that was placed on each of the attendees to ensure that they had a fabulous time. All of this causes me to believe that this type of attention is also paid to each of their customer relationships. The perfect message for a DMA party.

Lesson learned: As you are setting your marketing budgets for 2008, keep an eye on how those important dollars are allocated. You can get a bigger bang out of each marketing dollar by focusing on the details of your marketing goals. By paying attention to the details, you will more than likely reach -- if not exceed -- your goals. This will make you look like a Superbowl Hero within your own company!

Kudos to Direct Group for providing us with the wonderful party -- and the valuable lesson!

Also, a shout out to our fellow blogging friend, Ron Shevlin, who invited us to his lovely party at Epsilon, too. Ron is just as witty and intelligent in person as he is on his Marketing ROI blog. Thanks Ron!

Live from the DMA!

Well, we made it here to Chicago. And, yes, it IS kinda windy, but nice weather overall. The town is full of direct marketers here to attend the annual DMA conference.

We started the conference on Sunday night with a night of party-hopping. Our mission was to ask other attendees why they decided to attend the conference--what they were hoping to get out of the show. And while it's still early, here are the initial themes of what we learned:

• What are the newest direct marketing data sources and technologies available to us? As the year comes to a close, many are looking at their budgets for next year and trying to determine the best ways to spend them. Since profitability goals have only increased (no shock there, right?), those dollars need to be spent on what will help increase the ROI of each campaign. Many are looking at ways to increase the efficiency of their marketing databases, as well. This conference will showcase all of the latest and greatest out there-- that's for certain!
• Who can I network with that I can learn from? We ran into a zillion direct marketers who were seeking others in their same position so that they could learn from them. There were some great conversations going on in the parties we attended -- people were sharing what was working -- and what wasn't -- in their businesses. This is a great place to get new ideas to make your business more successful.
• People LOVE the parties! Well, I guess that sort of goes without saying, right?

We'll keep you posted as we learn more today. If you're here in Chicago, we hope to see you in the Exhibit Hall! And many thanks to Acxiom and Merkle for putting on such a great show last night!

Direct Marketers' Resume: The Master of Many Domains

Recently, we've seen a trend occurring within our client companies. It seems that Direct Marketing staffs are very lean and mean -- and that the few are taking on the jobs of many. Sound familiar?

Well, in a recent study by Bernhart Associates, the reason for this becomes a bit clearer. Since the beginning of 2006, Jerry Bernhart, President of Berhhart Associates Executive Search firm, reports that there has definitely been a slowing trend in jobs for Direct Marketers. Bernhart states, “The numbers are showing little change compared with summer. At the same time, the new hire percentage continues to show a slow and steady decline, which began about a year and a half ago.”

Here are some more stats from the survey, which was recently taken (sent out the week of October 1st), in which 116 companies responded:

60 percent of companies responding said they plan to add to staff by the end of the year, down slightly from 61 percent during the summer quarter:

• In April 2006, when the new hire percentage reached its recent peak, the new hire percentage stood at 72 percent.
• The record high for the index occurred in the fall of 2005, when it reached 80 percent.

9 percent plan to reduce staff in the coming three months, up from 7 percent during the summer.

29 percent expect no change in hiring plans during the coming three months.

85 percent of those surveyed said they are having either a “very difficult” time or a “somewhat difficult” time finding qualified applicants for open positions.

Only 15 percent said they are having little or no difficulty.

Bernhart goes on to state that, "While hiring is not at the heated pace it was a couple of years ago, the supply of qualified applicants remains tight.”

For those of us in the consulting business, this situation presents both challenges and opportunities. On the one hand, our clients are totally overwhelmed with the amount of work that they are now responsible for, so it's tougher to get on their already-overbooked schedules. They simply don't have the bandwidth to sit down for a meeting. As a result, things like campaign analysis and reporting are not getting the focus they need and deserve (Hel-loooo -- we need to measure how effective our data is performing, people!). This is really unfortunate because this is the time of year where more focus tends to be spent on analyzing marketing budgets and staffs. So, for us -- while we struggle to steal the time for this, we are adamant about it! (Call us pests . . . we don't care).

At the opportunities-end, we are certainly needed more. As the staff-size decreases and our clients are balancing multiple roles, they need someone to come in who can be flexible, open-minded, and supportive with marketing planning and strategy. The other need is to simply off-load certain responsibilities -- or at least help them manage to their new responsibilities. Of course, we do all of this happily!

From our perspective, this is both the good news and the bad news of these types of economic times. The best news is that top-performing direct marketing professionals are very sought after in this slowing economy. This is good for all of us!

Therefore, this is an excellent time to sit down and focus on measuring and reporting out on your effectiveness. The reason is two-fold: 1) Your Leadership Team is consistently aware of your performance and how you are responsible for increasing corporate profitability, and (2) As planning for the new year is well under way, as a result of your success you may have the opportunity to win a bigger marketing budget and, hopefully, more money in your paycheck!

TGIF!! And we hope to see lots of our Blog-Reading Friends at DMA in Chicago. If you're going to be there, please let us know so that we can meet you there in person!

Data: Who Owns it?

Today's topic: Data Ownership.

I came across two very different articles about two very different situations today, both from "Technology News".

Article 1: Discussion about ownership of prospect and customer data, especially as it relates to business-to-business sales and direct marketing. From the article titled: Who Really Owns Customer Data: "Ask CRM (customer relationship management) administrators about who owns the data populating their CRM systems, and you will likely get one of two emphatic answers: "my company" or "me." The article goes on to state that in this age where so much company info is available on the Internet, the data really isn't owned anymore by the company (or the database) or even by the sales rep anymore. A thick Rolodex really is no longer considered a competitive advantage.

Article 2: Virgin Mobile and the Case of the Nicked Pix (love that title, by the way!). This one reports on how a Dallas teens' photo posted to Flikr ended up appearing in an Australian ad for Virgin Mobile. The teenager is suing Virgin for the use of her image without her permission, or knowledge.

Two totally different discussions, but at the crux of both is this--data ownership. I think that they bring up a lot of questions that we direct marketers need to carefully consider:

• Does the ultimate ownership of data belong to the individual?
• If we compile and store data, do we figure out a way for individuals and/or businesses to change their information (as credit reporting agencies have to)?
• What about the photo-sharing sites and other similar Web 2.0 services? Who is responsible for monitoring data access and use?
• How do we ensure data privacy (especially for some of the new b2b Web 2.0 services that allow for group collaboration on business projects, all via a web service)?

These types of questions need to be addressed and as we move towards more and more data being readily available to consumers and businesses alike, we need to keep our eyes opened to possibilities of data theft and other 'bad' uses of data.

Interesting times, indeed!

Direct Marketing and the Environment: Score Two More!

It's been awhile since we've featured our favorite frog . . . and today, we're glad to bring him back. Today, more than ever, there's increasing evidence that Direct Marketers and Consumers are paying a whole lot more attention to environmental issues. It is impacting how we market, and it's impacting how our customers spend their dollars.

In two recent articles from DM News, increasing awareness of being environmentally conscious is highlighted. In the first article, it is reported that "Cooler, a provider of commerce solutions that address global warming, has launched a new program to help manufacturers and retailers of consumer products and services address the global warming impact of what they sell."

Cooler takes a unique approach wherein it "provides an emissions assessment, a roadmap for emission reductions and high-quality offsets from renewable energy and pollution prevention projects. It also includes a marketing kit to help clients communicate the actions they are taking to address global warming." Then, they went a step further by launching a website where consumers can choose from over 400 internet retailers who support environmentally conscious ways of doing business (i.e., reduce emissions, use renewable energy as part of their business, etc.). As the holiday shopping season approaches, we'll keep our eyes on how Cooler does with this effort.

In a second article, DM News reports that UPS has recently "asserted its commitment to environmentalism by ordering 167 compressed natural gas delivery trucks and 139 new propane delivery trucks. These additions make the delivery service company the largest private alternative fuel fleet owner, with a total fleet of 1,629 vehicles." These are pretty impressive statistics. As one of the leading direct mailers, UPS has definitely set the benchmark for its competitors.

These recent articles point to the fact that consumers and businesses are not only becoming more concerned about the state of our environment, but that this awareness does not look like a passing fad. It will be interesting to see how this evolves over time. When it comes right down to it, we vote with our dollars. As time goes on, we'll see how corporate revenue is impacted by those like Cooler and UPS who are blazing the trail in environmental responsibility in direct marketing. On the flip side, it will also be interesting to see how those who are not changing their strategy to reflect the shifting attitudes of public opinion will fare revenue-wise.

Kermit has always said (or sang) "It's not easy being green." We think that while it may not be easy, it may be imperative to your direct marketing efforts.