I recently had a conversation with another catalog consultant about a client proposal we’re jointly working on. The conversation worked its way to a discussion on the basic fundamentals of direct marketing. In essence, what’s the most basic fundamental of direct marketing that we need to present and our clients need to follow?
It came down to this: the 40/40/20 rule.
This rule states that in order to be successful in direct marketing, you must do the following:
- Concentrate 40 percent of your efforts on lists. That means list analysis and planning, selection, RFM, and, most importantly for catalogers, circulation.
- Concentrate an additional 40 percent on your offer. For catalogers, that means merchandising. That requires expert attention to detail, including but not limited to product selection, pricing, presentation and analysis. By analysis, I’m referring to square-inch analysis, the most powerful tool you can use to manage your catalog merchandising — aka “squinch.” Understanding the wants and needs of your customers is part of this function, as are the offers you make to them to stimulate response.
- Tie it all together by spending 20 percent of your efforts on creative execution. Literally, creative execution is only one thing: the bringing together of your list and offer/merchandising efforts in such a way that it speaks “buy now” to your customers.
As a consultant, I almost always see this in reverse.
If I had to quantify what I see in clients as they apply the above core competencies, it would be these three:
- 50 percent merchandising, with less emphasis on analysis and more on product development and presentation;
- 30 percent on creative. The creative (i.e., the catalog) is the brand’s calling card;
- and 20 percent on lists.
In the catalog business, lists and all that circ stuff are just as important (some would even say more) than offer and creative.
It’s easy to see how that could happen. Most catalogers are merchants first. They had a product idea and brought that to market. How they bring it to market is all about building brand image. It’s as simple as that.
I usually get called in when there are some business issues that need addressing. Often I’m told that there’s a problem with their catalogs. To this I say, “The catalog (or direct mail piece) isn’t the problem; you’re trying to solve a marketing problem (translation: circ and merchandising analysis) with a creative (design, look, feel, brand) solution.“
At that point, I review the client’s version of the 40/40/20 rule and then the “textbook” version. There’s plenty of evidence for the proper application of the rule in the direct marketing textbooks. Absent this principle, I’ve seen some horribly ugly catalogs that are cash cows, while beautiful catalogs sink like stones.
Jim Gilbert is president of Gilbert Direct Marketing, a full-service catalog and direct marketing agency. His LinkedIn profile can be viewed at www.linkedin.com/in/jimwgilbert or you can post a comment here or e-mail him at firstname.lastname@example.org. You can also follow Jim on Twitter at www.twitter.com/gilbertdirect. Read Jim’s personal blog at http://gilbertdirectmarketing.wordpress.com/.
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