The Direct Marketing Mindset: It's About Customers, Not Just Sales

Written By Ted Grigg

During an initial meeting with a national jewelry retailer, the VP of Advertising mentioned they mailed over 20 million catalogs each year. I asked him what the results were. He told me he did not know exactly but knew that the mailings increased sales. So even though he could not quantify it's impact (he never tested it), no one in the company dared challenge the seasonal catalog mailings.

This response from a retailer no longer surprises me because a large part of the industry still works under the illusion that everyone is a customer. Some retailers treat prospects and customers the same way by sending them the same offers using the same contact strategies.

In fact, many large retailers still do not maintain relational databases to track sales at the customer level that would enable them to evaluate the effectiveness of their advertising. They are also unable to modify offers based on a customer‘s past purchase history.

So what causes this blind spot in certain businesses?

In the recent editorial in Target Marketing Magazine, Denny Hatch may have expressed a concept that could help these companies understand the importance of building state of the art relational databases. He said:

"As direct marketers we're not here primarily to make a sale; we're here to get a customer."

This strategic shift in thinking helps clients grasp the core concept of the direct marketing strategy.

Direct marketers do not create one off direct marketing campaigns, but rather build incremental revenue by leveraging customer databases. In a way, sales come as a result of the marketer's priority of acquiring the right kind of customers and then surrounding those customers with multiple offers to convert them from one time buyers into repeat buyers.

Do you work in an environment that is so intent on asking for the sale that the company has forgotten that a every sale starts a customer? If so, have you noticed if this mind-set causes the company to squander selling opportunities? 

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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