Direct Marketing Links

Another week has gone by. Where the heck do the days go, anyway? As always, here's a round-up of some of the articles that intrigued me this week.

Small Favors, Big Success
Wow! The research on this post from the Neuromarketing blog intrigued me (and surprised me, too). The author explores how someone is more likely to say 'yes' to doing a favor if they've already performed one small favor first. "The message in all this is clear. Making a small initial request of your targets won’t turn them off. Rather, if it is small enough to be granted by almost everyone, it will make them more likely to respond positively to your ultimate request."

The article cites multiple examples and really got me thinking. I will definitely be testing this concept in some future direct marketing campaign!

Build your Business with LinkedIn
Check out this post from Hit Search. It highlights a video about how one marketing expert is using LinkedIn, and specifically its Q&A feature to gain new clients (as in over $250,000 sales to-date!). I know that I really enjoy reading, asking and answering questions at LinkedIn and find it an awesome resource. Good to know that some folks are also benefiting in the way of new contacts and new contracts.

Domain Name Tips
Loved this podcast from Bob Parsons, CEO of GoDaddy.com. He provides tips on how to choose the best domain names. Some of my favorites: Make sure that the domain is easy to spell...And, avoid numbers and hyphens. Hmmm. Good stuff and a fun video to watch. An excellent use of a short video, by the way, AND it fits right in with GoDaddy's business. I guess this guy does know what he's doing...

Building Your Personal Brand
I loved this post from the Brand Dame blog (excellent name, by the way!). The author, Jill Biden provides some handy advice about using email signatures, your blog, website and social networks to build your personal brand. Small things that most of us forget about, but that can enhance your image on a daily basis.

Honoring 9-11
I know I'm a bit late here, but the advice from the Media Orchard blog resonates whenever you read it. The blog lists 9 ways to honor 9-11. My favorite: "Treat people the way you did in the days immediately after the 9/11 attacks." I can well remember how that horrible event caused us to really be grateful for our friends and family; it caused me to appreciate what I have in my life. These are good things to remember and a heck of a great way to commemorate 9-11.


Have a wonderful weekend. Enjoy the last of these summer days :)

Data Mining for the Wireless Industry

It's not often that you see this Direct Marketing Blog announce new products or services. It's not our 'thing' to try to sell anyone anything (well, at least not here on the blog). But, sometimes, I come across announcements of new marketing solutions that really intrigue me and I feel compelled to share.

And, that's what happened today.

Xtract, a Finland-based firm that provides social advertising intelligence solutions (and also a firm that I'd never even heard of--shame on me) released this announcement just yesterday:
Xtract Social Links™ Now Available in USA, Adds Demographic Prediction.

You know I'm a sucker for data mining! This service offers a new spin on analyzing customer transaction data. Essentially, Xtract's tool combs through wireless carrier network data, and provides insight into each subscribers' personal contacts/phone numbers/people they call often. From the article:

Xtract Social Links turns raw customer data into a vital marketing tool for mobile operators. By analyzing the social networks within large scale mobile communication networks it identifies the underlying social network structures within the subscriber base and the most influential people in the network, which Xtract calls Alpha Users. The result is a completely new layer of customer insight and a tangible tool for increasing the efficiency of targeted marketing and advertising.

The add-on modules combine social network with demographic and behavioral information, providing a Three Dimensional (3D) view of the customers for specific business applications including marketing activities by mobile operators as well as targeting for mobile advertising.

Wow! Any marketer for a wireless carrier should be thrilled to hear about this solution. With the tool, now not only can you analyze your customer-base, but you'll have an understanding of your customers' friends and business colleagues. Think about the opportunities--the opportunity to present targeted offers, the opportunity to expand your customer-base.

And, of course, this insight provides mobile marketers with a wealth of data that can be used to target their ads to the exact right groups of prospects.

The other interesting thing is that the tool can be used to analyze usage of pre-paid customers--formerly customers that the carriers really didn't know much about (since they didn't send them a monthly bill).

Neat!

Mortgages, Finance, Home Prices--OH MY!

Throughout my career, I've provided direct marketing services to the mortgage and financial services industry. I've had some excellent years and other years where times were tough. I understand the cyclical nature of things and am usually grateful that the accountability of direct marketing programs helps ensure their (and my!) survival.

But, I have to say that this is about the weirdest time I can recall for the financial services industry.

• Just reported a few hours ago: Consumer borrowing slows to weakest in 7 months.
• Pending US home sales are down. The AP reports that "The National Association of Realtors said its seasonally adjusted index of pending sales for existing homes fell 3.2 percent."
• The government is taking over Fannie Mae and Freddie Mac. The cynic in me wonders how the government is going to be able to run these agencies efficiently (let me be blunt--it'll never happen!). This new government backing may give us a short boost of consumer confidence and some newly funded mortgages. But, I fear that long-term government involvement will simply lead to higher interest rates for home loans--not good for anyone.
  
• The financial services sector is laying people off right and left. Some of my colleagues--highly experienced direct marketers--have been impacted by these layoffs.

Anyone who's read this blog knows that I'm typically an optimist. Yes, I'm the type of person that truly believes that the glass is half full. But continued news and personal experiences tell me that this time the financial services sector isn't gonna recover as quickly as it has in the past.

Tell me, am I being too pessimistic here? Are there lights at the end of the tunnel that I'm missing?

Case Study: Walgreens and Behavioral Targeting

It's pretty tough right now to be a retailer. The economy is limping along. The Walmarts of the world are bringing prices down and changing customer expectations every day.

Smart retailers need to use all of the tools at their disposal to get more customers and sell more stuff. This article about Walgreen's coupon strategies, brought to us by DM News caught my eye: Walgreens' in-store BT strategy hits the mark.

Background
Walgreens is using behavioral tar­geting to engage customers in its stores.

The nation's largest drugstore chain has partnered with Catalina Marketing to print targeted coupons in its 6,000 stores, which are given to customers based on their purchasing behaviors, as they receive their receipts. Catalina runs in-store pro­motions in about 25,000 grocery stores and 14,000 pharmacies nationwide.

Strategy
Walgreens' overall strategy is to lever­age consumer data more effectively, which Doug Egan, VP of marketing services and research for the company, said has ramped up in the last six months.

“[It's] part of a larger understanding that purchasing behavior can be changed in-store,” he said. “Truly, the trackability of it is great. We can track purchases by store, time of day and even register.”

Walgreens' marketing spend is still dominated by its circular — 60 million per week — and by direct mail.

Results
Egan said that in-store promotions, cur­rently accounting for 10% of Walgreens' marketing spend, are growing, thanks to the success of the Catalina promotions.

“What we've heard from customers is that they are useful,” he said.

Average Walgreens stores see between 800 and 1,000 customers per day and print Catalina coupons for about 10% to 12% of them. About 6% of those printed are redeemed at a future date, said Egan.

The goal of using Catalina coupons or behavior targeting overall is to expand the consumer's shopping basket, said Egan.

“The average purchase, not counting pharmacy, is three to four items per store visit, and two store visits a month. We want to add a trip a month,” he said. “It's great to see data of what a customer is purchasing in real-time. You can then offer related programs. If they purchase two twelve-packs of Pepsi, we can target them with a coupon for a dollar off of three twelve-packs. You can see what customers purchase consistently.”

Interesting case study, no?

Back in June, I blogged about couponning and put forth this challenge to direct marketers: How do you track exactly who is redeeming your coupon, without making this cumbersome to the consumer? In Walgreen's case, they know what products people are purchasing, but I still can't see where they have a handle on the make-up of what buyers look like.

It would be so much more powerful if you could flesh out purchase behavior with other things known about the consumer, wouldn't it?

Then, you could begin true database marketing and really start to delight your customers--with offers tailored specifically to a customers' specific needs and situation. You'd not only have the knowledge that a specific customer enjoys Pepsi over Coke, but if you knew, for example, that that customer has a large family and likes to go camping, you could customize the Pepsi offer to include a propane tank or other camping gear. Now, we're talking about a much larger shopping cart (more revenue), and a satisfied customer who leaves the store happy that they've gotten a great deal, not only on Pepsi but on gear for an activity they love.

I would love to see retailing move in this direction, wouldn't you?

Segmentation Comes to Mobile Marketing

I'm not typically a huge fan of off-the-shelf segmentation packages. We've all seen them from leading companies such as Claritas, Experian and Acxiom. These data firms each sell their version of a consumer classification scheme that attempts to categorize each consumer/household into one of 50+ clusters.

And, they've come up with excellent names to allow us to visualize the segments (I especially love the Prizm cluster called "Shotguns and Pick-ups"!)

Typically, my take on using these off-the-shelf tools is that a marketer would be much better served developing their own customer segmentation strategy. I find that 50+ segments is simply too many clusters to act on. If you do the data mining exercise to find your own clusters, you'll end up with a manageable and actionable segmentation system--one that's more powerful than the non-customized version. By the way, if you'd like to see a sample segmentation deliverable from RRW, just request it here.

With that said, I was still quite pleased to hear that segmentation is being applied to mobile marketing! Check out this press release:

Nielsen Delivers PRIZM Insight for Mobile Advertisers
Combining Consumer Segments With Mobile Media Targeting Enables Advertisers to Connect More Effectively With Mobile Audiences

Neilsen's idea is to combine mobile usage patterns with Claritas PRIZM clusters to paint a full picture of mobile audiences. Makes sense to me! From the article:

By combining Nielsen Claritas' PRIZM lifestyle segmentation data with Nielsen Mobile's Mobile Media Marketplace, Nielsen is positioned to provide unique insights into consumer media habits.

For example, analysis of one PRIZM segment -- Bohemian Mix (a progressive mix of young singles and couples, students and professionals who are quick to check out the latest movie, nightclub, laptop or microbrew) -- shows that this group leads all other categories in mobile Internet usage, with 27 percent accessing the mobile Internet in the last 30 days (compared to an average 16.7 percent across all other segments).

"Targeted customized analysis of mobile usage patterns for PRIZM's 66 consumer segments allows advertisers to make more informed decisions about where to place mobile advertising," said Kanishka Agarwal, vice president of mobile media at Nielsen Mobile. "Mobile-PRIZM drives a stronger advertising ROI for our clients," he added.

I love to see technology mingling successfully with data (a passion of mine!), so I'm definitely going to learn more about this offering.

More on Marketing for Wineries

I just can't seem to get off of the topic of direct marketing for the wine-making business, can I?

Last week, I shared with you news about Jordan Winery's new loyalty program (as well as some personal information about my love for wine and the genesis of my firm's name, RRW!). Today I thought you might be just as interested in how Stag's Leap is using email to build a customer relationship.

From DM News: Stag's Leap Wine Cellars toast to e-mail. The article goes into some pretty good detail about how this winery is maximizing the channel.

The winery works with e-mail services firm Vertical Response to send 12 e-mail campaigns a year. Six are launched every other month to the house mailing list and the company plans to double that number this year. The others are launched on the opposite months to club members only.

“The strategy is to reach out to our consumers who have requested information about our winery and to hopefully prompt them to visit our Web site to build a long-term relationship with our customers,” said Nancy Burton, Club 23 manager at Stag's Leap Wine Cellars, via e-mail.

I agree that email is an excellent channel for Stags Leap.

Email is a tool that, when used the right way, generates sales and boosts visibility. We all receive so much email on a daily basis, however. We know that the only emails that survive the 'delete' button in our own in-boxes are those that we want to receive; those that we're interested in. We all keep personal emails and we all have that short-list of commercial emails that we wouldn't miss, and that we definitely open.

So, what makes an email move to that 'open' short-list? In my opinion, it's as simple as relevance. If the email is coming from a company or an industry that I'm interested in, I'll open it, even if I don't have a long-term relationship with the sender. In my case, for example, I would definitely open an email from Stags Leap (or any other winery). I'm interested in hearing about wine. I like to buy it and I'm already a member of many wine clubs.

The challenge, of course, is to figure out who among your customers and prospects is receptive to hearing from you. This is where tried and true direct marketing disciplines such as testing and segmentation come into play. A strong offer and a clear call to action are critical components of a good email campaign, too.

And, to complete the loop, it's critical to measure success against campaign goals. By success, I think we need to go beyond open and click through rates, and do a much better job of quantifying email campaign results. Your measurement strategy needs to answer these types of questions:

• How many incremental or new sales did the campaign generate?
• How many referrals did you make? How many new names can you add to your list?
  
• How did the campaign build loyalty (a really tough one to answer, btw)?

The bottom line: We direct marketers already have the knowledge and the tools to build superior email campaigns.

Economic forecast for marketing spend

"Direct's annual survey of e-commerce practices shows continued investment in digital strategies, with additional spending anticipated for 2009."

The above is a quote from the leading paragraph in a Direct Magazine article, titled "What Downturn?". The article reports on results of a recent survey that measured online and other marketing spending trends.

It should be no surprise that in this tough economy companies are looking for a measurable return on their marketing investment.

According to Direct's research, 29% of all marketers have shifted marketing dollars from traditional channels to online media, a figure comparable to last year's study.

Of course, online media is augmented with off-line. Marketers are embracing a multi-channel approach, with a slightly different 'spin' for B2B vs B2C marketers.

Consumer firms indicate direct mail is their key Web site traffic driver, with e-mail a close second. Natural search (as a result of search optimization), paid search listings and word-of-mouth referrals follow.

B-to-B firms rely more on word of mouth — so much so that it's the top-cited channel for generating Web traffic. E-mail and direct mail campaigns are gaining fast, though, while search engine optimization trails, a distant fourth.

Some other interesting findings:

• Just over half of B-to-B respondents optimize their Web sites in order to boost rankings in search engine queries, compared with more than two-thirds of consumer companies.

• Consumer marketers are more diligent about collecting and analyzing clickthrough data than B-to-B firms. Better than three out of four consumer respondents do this, vs. 57% of B-to-B DMers.

• Just over one out of five respondents say staffing in their online marketing departments was up during the last 12 months, while nearly two-thirds note that it stayed the same. As in 2007, only 4% lost employees.

My take: Overall, direct marketing, as an industry, is alive and kicking. We're poised for growth in key areas (analytics is one of them) and a multi-channel approach is important.