Direct Marketing Strategy Guidelines

Written By Ted Grigg

Writing such a simplified list brings with it the risks of generalization. Principles, guidelines and "rules" require caveats. There are exceptions to these precepts.

So consider these as guidelines that will help you focus your strategic planning for campaigns, organizational structure or even program evaluation.

DMCG Results

1. Not all online marketing is direct marketing.

Just as all television advertising is not all direct response advertising, so it is with online marketing. If it can't be tracked, measured, or evaluated, then it no longer falls into the direct marketing strategy.

Social media, for example, probably belongs in the PR camp rather than an online specialist. By that same line of reasoning, direct response online marketing activity belongs squarely with the direct marketing specialist who also knows about the online medium.

2. When looking to support any marketing activity with direct response, first determine your allowable cost per sale or cost per customer.

For example, in BtoB lead generation, if your BtoB program requires a $5 cost per lead or a $25 cost per sale, then you probably need to omit telemarketing as your prime lead generator.

By establishing these financial parameters early on, you will rule out certain options in your planning process. This keeps you from wasting your money on strategies that have no chance of working.

3. Most BtoC direct marketing activities require large volume customer or prospect segments to succeed. But that guideline has reversed itself.

In other words, heavy reliance on direct mail and traditional media require large quantities to gain economies of scale. Small, highly responsive lists are not even tested because there is no rollout potential.

The new print personalization capabilities weakened this requirement somewhat in the direct mail area.

But with the advent of online marketing, successful direct marketers now look seriously at smaller and smaller niches for long term success.

Segmentation now drops down to the individual level offering specific products, pricing and emotional copy based on a given individual's profile. So direct marketers should not consider "rollout" potential only, but also the smaller piles of gold. Because the large ones are disappearing faster than most industries can keep up with.

4. As with the postal regulations and efficient direct mail production knowledge for the direct mail medium, the new direct marketers must broaden their online technical skills.

Some direct marketers might ask why they need to develop these types of implementation skills?

The answer: How can direct marketers think big picture without a command of the specifics?

How can you evaluate your web site and its potential without knowing such things as keyword density, Meta Data content, "Who can see" settings or URL keywording? What about the potential of organic search versus paid search? What are the paid search options? How do you recognize a thorough paid search plan? How do you evaluate its effectiveness?

Add to this the complexity of the changes taking place in the spam wracked email environment and the "No Mail" laws waiting for approval in several state legislatures.

Command of the details leads to broader thinking when it comes to direct marketing strategy development.

5. Some of the old premises still hold true. Right audience + right offer + right product = success

I'm appalled at the general lack of focus on the offer. And this leads to the next guideline.

6. To qualify as direct marketing, the campaign requires a mixture of these strategic ingredients.

  1. Audience testing. Test various audience parameters with all of your targeted media efforts.

  1. Offer testing. This includes controlled tests measuring results by offer. The offer includes such things as pricing, product packaging, discounts, free gifts, contests, payment options and an almost endless list of possibilities.

  1. Response tracking. Structure the test to track response rates, customer quality and media synergies when several media are used to support the primary medium. For example, television advertising to support one web site or product versus another with no TV support.

  1. Database building. If you are not saving the responses to a relational database, then you are not in the direct marketing business. Save all leads and responses for back-end analysis and future campaigns. Apply rigorous segmentation testing based on the customers' preferred media consumption habits.

  1. Evaluation of the campaign based on a cost per sale allowable. Always define success in financial terms prior to committing to ANY direct marketing campaign.

I may continue this compilation of direct marketing strategic guidelines in a future posts.

Which others would you add to this list? I'm sure there are many that are missing.

Ted Grigg

Ted Grigg is a direct response strategist who helps growth-focused companies reduce risk by identifying weak assumptions before they become costly mistakes.

Over the course of his career, Ted has evaluated several hundred million dollars in direct response testing across direct mail, digital, print, television, telephone, and other channels. His work combines direct response strategy, acquisition economics, customer analysis, creative evaluation, offer development, and disciplined testing.

Ted has worked on both the client and agency sides of the business. That experience gives him a practical understanding of the pressures facing executives, marketing teams, agencies, and service providers—and of the problems that arise when activity, media volume, or creative preference replaces a clear economic objective.

His consulting work helps organizations examine such questions as:

  • Are acquisition goals economically realistic?

  • Is the allowable Cost Per Sale supported by customer value?

  • Are targeting, offers, creative, media, and response paths working together?

  • Are tests structured to produce reliable business decisions?

  • Are unproven assumptions being treated as facts?

  • Is the organization measuring sales outcomes rather than convenient proxies?

Ted’s experience includes the development of direct mail and multichannel acquisition programs for insurance, healthcare, financial services, technology, nonprofit, manufacturing, retail, transportation, communications, government, and business-to-business organizations.

For a national direct-to-consumer insurance company, he developed a direct mail format that defeated established controls and helped expand the productive use of compiled prospect lists from less than 10 percent to more than 30 percent of total direct mail circulation within one year. He also planned Medicare lead-generation programs for more than 60 regional and national HMO and PPO organizations, with some programs exceeding sales projections by as much as 60 percent.

Ted founded Wyse Direct, a direct marketing division of Wyse Advertising in Cleveland, where he developed acquisition programs and helped launch a new technology product for Seiko Instruments by generating a predictable flow of qualified sales leads for its national sales organization. As vice president of new business development for the Grizzard Agency, he helped broaden the agency’s strategic capabilities and pursue new commercial and fundraising opportunities.

He is the author of The HMO/PPO Marketing Plan—A Step-by-Step Guide, published by Executive Enterprises, and has written numerous articles and conducted webinars on direct response strategy, testing, creative development, and marketing economics.

Ted earned a Bachelor of Arts degree from Abilene Christian University and completed two years of graduate study at Texas Tech University. He is the founder of DMCG, LLC.

http://www.dmcgresults.com
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