Kudos, an open letter (and a warning) to the USPS Postmaster General (spread this around)

Over the years I’ve been super vocal about my dislike for the U.S. Postal Service and its less-than-forward-thinking bureaucracy. When it slammed direct marketers with a 20 percent postal increase back in 2007, I went (pun intended) postal on it in my Catalog Success Magazine Column.

Earlier this year after it announced its summer postage sale, I was optimistic. But once I looked at the fine print (i.e., how much you had to mail to qualify), I was critical then, too.

I try to be fair in the offering of my opinions.

Therefore, I have to applaud the USPS for its announcement last week that there would not be a postal rate increase in 2010 for dominant classes.

For those of you not aware yet, last week the Postmaster General sent out a memo announcing no 2010 rate increase, which has spread around the internet faster than a scandalous YouTube video goes viral. That memo can be reviewed here.

I know, I know: Postal rates are already ridiculously and restrictively high, but at least mailers can build their 2010 mail plans without having to cut circ from marginal lists and housefile segments.

But along with my kudos to our Postmaster and the USPS, I also want to put them on notice.  Here goes:

Dear Mr. Postmaster General,
You’ve started a trend here. Between the postal summer sale and now this offer to keep postal rates stable in 2010, catalog and direct mailers believe that you may actually be interested in working to our benefit. We look forward to the next postal sale, and hope that the USPS opens it up to smaller mailers to take advantage of. We truly hope that you’ll continue to stop thinking like a bureaucracy and encourage more mail volume with innovative special offers and such.

But we’re also wary. Direct marketers are wary because the USPS holds a great deal of power and leverage over us. The last substantial postal rate increase nearly put us under with rate increases of 20 percent-plus. What was the USPS thinking? That move single-handedly drove more and more mailers into the online world. If we were to do the math, we believe the increase in postage actually caused your revenues to go down due to less mail in the mailstream.

Remember this Mr. Postmaster General: Every penny more it costs us to mail means we need to generate about two cents more per catalog and direct mail piece mailed just to breakeven. In this economy, we need every opportunity we can get to mail profitably. We’re struggling to stay alive and keep our workers employed and our customers satisfied.

Keep up the good work, Mr. Postmaster. Please continue this trend.

Sincerely, 
The Direct Mail Industry

As to you, my loyal readers, I encourage you to send your letters to the Postmaster General (or just copy mine and send it). Make your voice heard! Remember, the squeaky wheel gets the grease.

Reach the Postmaster General at the following:

The Honorable John E. Potter
Postmaster General

U.S. Postal Service

475 L’Enfant Plaza, SW

Washington, DC 20260-0010

Email: pmgceo@usps.gov

Speak to you next week, when I’ll discuss a tactic to help you reduce mail costs by doing a specific suppression on your housefile and list rentals.

Orignally published in All About ROI (formerly Catalog Success) Magazine.

Guest Post – 7 Secrets to Scoring High on Data Card Quality

Note from Jim. Chris DeMartine from NextMark sent me this article for review.  I liked it and decided to publish it for you.  NextMark is the premier resource for the list industry with info on over 60,000 lists.  It’s the go to site for list brokers, managers and data providers.  All direct marketers should be in-the-know about the list industry and it’s guiding principles.  The article below is an excellent primer on list scoring.

If you are interested in direct mail or telemarketing lists, my sister company, Axxes Data can put together a list recommendation for you.  Let me know.

Jim

Good mailing list purchase decisions depend on a good data card database, and NextMark ensures the quality of its data card database through the Data Card Quality Report and other monitoring tools. While it is important not to confuse data card quality with list quality, counts are changing all the time and a neglected data card could be a warning sign of a neglected list. This blog entry is primarily for list managers who are looking for insights on how to keep their data cards up-to-date most efficiently using NextMark’s data card publishing tool.

How are data cards scored?

The scoring process is reviewed on a quarterly basis, and subsequently refined to address list specific criteria.  Individual data card scores are calculated using a weighted average of thirteen attributes, with an emphasis on last update (the date when the card was last updated and/or confirmed by the list manager). The basic principle is to create a quality data card from the start, and to manage the update process efficiently. List managers may also contact NextMark to learn how these updates may be processed automatically on their own web site, and integrated on a search engine optimized (SEO) platform to be indexed by Google and the other search engines.

Seven secrets to scoring high on data card quality:

#1 Review your data card quality report: select either ‘Data Card Quality Spreadsheet’ or ‘Data Card Quality Print View’ from the ‘CHOOSE A REPORT’ menu on the Lists – Management tab. You must be signed in to NextMark under your list management organization to run this report.

#2 Use the ‘next update date’ field: by populating this field you get the benefit of receiving an e-mail reminder (to update the data card) seven days prior to the date you enter. The next update date must be greater than or equal to the current date in order to receive full credit for last update. If you decide that you do not want to update this field, then be sure to leave it blank and manage your edits based on the update frequency.

#3 Check the update frequency: it is important for list brokers to know how often the names on a mailing list are updated. If the next update date is not populated, then the data card quality score will be based on the update frequency and the last date and time when the data card was updated by the list manager. For example, a data card representing a list that updates monthly should be confirmed every 30 days. However, if the update frequency is semi-annually, then you would only need to update the data card twice per year. Of course, this assumes that there have been no pricing or other changes to the file during the update cycle.

#4 Populate all scored fields for postal list types: make sure that every one of the fields representing the thirteen attributes are populated with valid information. There are a few exceptions to this, for example: if a list is available for email addresses only, then you would not be required to select outputs; or if a list is available on exchange only, then you would not be required to enter a base rate.

#5 Audit your list type selections: the scoring process for an insert program is slightly different than it is for a postal mailing list. The same holds true for other types such as blow-in or statement stuffer programs. It is important to make these selections carefully to make sure that your data cards are scored by the most appropriate criteria.

#6 Create a high quality list description:   although there is a minimum character length required for a high quality list description, the scoring process also considers your creative efforts as part of the grade. The html is also credited in a manner similar to the text length of your data card description. Therefore, you are able to focus your efforts on the quality of a list description and not solely its length. You may also create and edit custom tables in the description area to provide counts and/or other information about the list. These tables are also considered as part of the overall data card description score. It is also important to remember to populate the short description field, as you be unable to achieve a perfect grade without that.

#7 Select three relevant categories: you’ll need to select at least three categories on the data card that would be relevant to the broker or mailer who is renting the list. Excessive categorization is discouraged because it not only dilutes the uniqueness of a list, but also makes it difficult to determine the target audience for the list. However, you are not required to limit the number of categories, especially in cases where a list or database is enhanced with additional data for targeting specific demographics or psychographics.

Chris DeMartine is the Director of Business Development for NextMark.  He can be reached at (603) 643 – 1307 x. 114, or cdemartine@nextmark.com

How To Create Catalog Split Test Scenarios That Matter (part 2)

This week in the final installment of this two-part series on the value of creating mail tests that produce measurable, and telling, results for your catalog, I provide takeaway lessons from last week’s example of how one catalog company tested the profitability of using an upgraded paper stock in its catalog. I’ll also list some tips to help ensure your company is conducting productive mail tests. 

The Moral of the Story
Even scientific tests often succumb to the subjective. Once all of your scientific testing is done, the art of interpreting the data takes over. Returning to last week’s example, as a direct marketer I never would’ve rolled out the higher-grade paper without additional testing. I would’ve wanted to confirm my results by running the same test over again. Even if the test were a runaway success, I would’ve proceeded cautiously. 

In the catalog/multichannel industry, there are infinite varieties of tests that can be configured, measured and, ultimately, interpreted. 

So how do you become successful and improve your company via testing? I believe the following seven principles, that if adhered to, will allow you to hedge your bets.

1. Always test against something. Your current catalog, e-mail, Web site, merchandise, among other things, can be used as your control. 

2. Always create a testing hypothesis. Use this example: If we do X, we expect Y to occur. 

3. Always set up logical tests based on scientific principles.

4. Test only one variable at a time. If you test more than one, you’ll never know which variable made the difference. See below for a list of variables you can test.

5. Always do your math up front. Calculate all expenses in advance of the test and set up a pro forma profit and loss and break-even analysis. 

6. Always do the math on the back end. Before the creative side of testing begins, have the math in front of you. Many times the numbers will drive decisions. 

7. Always test until you’re satisfied. Don’t roll out any changes to your catalog unless you’re certain of the outcome through testing, retesting and further testing. 

Variables You Can Test Today (a checklist to get you started)

List Variables:

* Recency — the most recent names from a new list; if your list is “working”; older segments of the list; average order sizes.

* New lists in your product category.

Creative and Printing Variables:

* Paper, trim size, pages, formats, photography, copy, ink-jet messages, cover versions, dot whacks, inserts.

Offer Variables:

* Gift with purchase, dollar or percentage off, free shipping.

Merchandising Variables:

* New or different products; repositioning older or non best-sellers via creative execution.

The direct mail list business – A primer for general management

Since last September, we’ve discussed printing, merchandise and catalog creative execution. Over the next few weeks, I’ll serve up some suggestions and insights regarding the list side of the catalog business.

Always remember, the 40/40/20 rule of direct marketing states that list selection can impact 40 percent of your direct marketing efforts. 

For starters, you’re probably paying WAY too much attention to your merchandise and creative efforts! That’s O.K., it’s only natural. You’re a merchant in a product driven company and you want your products and your brand image to represent the sum of your hard work. Besides, your products and image are the calling card for your business, right? 

But as I’ve said before, don’t yourself as a product-driven company. Start focusing on matching up the right lists to the right offering — not one before the other, but in concert with each other.

Your job as a direct marketer is to put the puzzle pieces in the right place regarding the list choices you make. But it can be much more complicated than that.

Let’s take a look at lists in general for a minute. There are many different lists on the market and many different list brokers you can choose from. 

Simply put, lists are either two things, customers or prospects. They are made up of people with some sort of affinity to each other. Usually the glue that holds the names on a list together represents certain demographic, psychographic, social or behavioral factors.

Three Kinds of Lists

The basic three kinds of lists you can choose for your marketing efforts are the following:

• House lists: your own customers and prospects already in your database

• Response lists: lists of people who’ve responded to a specific offer (eg: catalog buyers)

• Compiled lists: people who came from a source like compiling from a phone book or public records etc.

The closer you stick with product offering’s affinity, the better for your results. For instance, your house list will always yield the best response. If you’re a consumer mail order cataloger, stay away from compiled lists and stick with response lists unless you have such a small list that you’ve exhausted all possible names of mail order buyers. From a product affinity perspective, the response list that most closely resembles your customers will most often return the best response rate. 

If you are a B-to-B marketer, then you may want to delve into the compiled list world.

Why? Stay tuned to my upcoming blogs, and I’ll explain why B-to-B and B-to-C catalog marketing efforts have very different list demands. We’ll also look in to some basics on list brokers and how to choose the right one, as well as other list concepts like circulation planning, RFM analysis, catalog co-op databases and models in the coming weeks.