10 Ways to Reduce Direct Marketing Costs, Save Your Company and Look Like a Superstar!


While our economy is showing some signs of life, still most people I know are freaked out, totally stressed; and terrified of losing their jobs, homes and more.

It has been tough out there for direct and multichannel marketers.

But all isn’t bad. I swear!

There’s an amazing opportunity in all of this chaos to streamline your business, strip away the dead wood in your budgets and be a rock star in your company.

Here are 10 steps to help you get started:

1. It’s time to renegotiate everything. Start with your key area’s of business — printing, mailing, lists, creative, prepress (oops, I meant premedia).

2. Do a print review. Have your printer bid against other printers. I did this for a turnaround I worked on and was able to reduce printing costs by 20 percent. (Seems my predecessor was asleep at the wheel.)

3. Tweak your catalog’s trim size or basis weight. You may find some cost savings there.

4. Co-mail! This can reduce your postage costs.

5. Take advantage of destination-entry discounts. (Ask your printer about what this and co-mailing entail, and what you can save. Or e-mail me and I’ll explain.)

6. List brokers are offering discounts and test pricing for mail files. Ask and you shall receive.

7. Look for more list exchanges. These can be had for run charges, a fraction of the rental fee.

8. Use the co-op databases, such as I-Behavior, Abacus and NextAction. They’ll model your customers and rent you prospect names for less than list rentals.

9. Do your matchbacks. Make sure you’re analyzing your mailings the best and most accurate way possible.

10. Run NCOALink, merge/purge and other list hygiene products before each mailing. I had a client who had the same name on his database six times. Waste of money! You only need one instance of a name to mail it. Find yourself a great service bureau to steer you to savings.

In two weeks I’ll give you 10 more ways to save money and reach superstar status. In the meantime, if you need any clarifications on these or any other ways to save money, let me know and I’ll work your answer into my next column.

Hang in there!

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 jimdirect@aol.com.

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11 Responses

  1. Jim,

    As someone who has really trimmed offline direct marketing because of the assocated costs, I appreciate these tips. Looking forward to the second installment.

  2. Jim:

    Those are excellent tips on reducing marketing costs. With the Postal Accountability Act and the dramatic changes in May 2008, all mailers need to re-think aspects mail dimensions/weight.

  3. Thanks for your comment George. Maybe you can say more regarding new mail specs for us.

    Jim

  4. Jim,

    Great information and it can never be repeated enough. As you may know starting on 11.23.08 the USPS requires NCOA every 95 days on repeat database mailings.

    Joe W.

  5. The best way is to go to Emarketing … You save paper . you get the right delivery and it is the most cost effective solutions

    • Shawn. Right now there has never been a better time to use direct mail and traditional DM media. Everybody is going towards emarketing. That leaves a giant space for quality traditional messages to get through the clutter.

      Stay tuned, I have an article going up this week on the topic.

      Oh and you should use whatever marketing channel works for you. Test and roll!

      Regards,
      Jim

  6. Great article, Jim –

    I, too, have found that in going back to all of our local printers, and assessing our own in-house printing , we’ve been able to cut print costs by about the same – 20% or more. We are always looking at paper alternatives and formats, 1/8th less on trim sizes, and any ways to save our customers money while giving them the best quality.

    Due to the recent USPS NCOA requirement, our company has purchased the software to NCOA in house, offering the service as mandatory on everything except recently purchased lists. At a cost of $2/1000, though, this is now extremely affordable and our customers know they are getting a cleaned, scrubbed list every time. The other benefit of having this service in-house is literally no lag time!

    Thanks for your article. I agree that now is definitely a time to be out there with direct mail marketing.

  7. Jim,
    Good tips for marketers to be looking closely at.

    To expand on point #10, marketers should also consider :
    1) Household and Company Penetration Analysis – the ability to limit the number of mail pieces going into a specific location through use of a multi level merge/purge processing is an effective way to reduce campaign level costs. Sometimes mailing more than one piece into a specific address is desired but marketers should still set “max per company” or “max per household” business rules.
    2) Pre Merge/Purge Scoring – Any data element that is available on an incoming record can be used to develop a priority to institute a “best kept record” score for mailing purposes. Address Deliverability Elements such as a DPV code, presence of a business title, transaction level data, etc. can all be used to assist in selecting the best possible record for mailing when duplicates are identified in the merge/purge process.
    3) Promotion History Processing – Introducing prior campaigns to flag and potentially suppress records based on the # of times they have been mailed (and what offers have they received) over a specific time period can help identify non-responsive records prior to incurring production and postage costs. This works best when the marketers active customer files are also introduced into the merge/purge process so they can identify if a record has been mailed and has not converted to a customer status.
    4) Proprietary Change of Address Services – some service bureaus offer products that can be very effective in reducing campaign level costs and increase campaign response rates by updating address elements (street #’s, directionals, etc.), appending apartment #’s, identifying movers that are not present on the USPS NCOA files and identifying individuals that have a higher likelihood of being non-responsive based on various data elements.

    This is just the ”tip of the iceberg” in regards to what direct marketers should be doing in utilizing merge/purge and related processing services to reduce campaign level costs while increasing campaign revenue. I agree with your statement that it is important to find a great service bureau to provide direction and feedback that will be of benefit. I feel this is more important now than ever before.

    • Thanks for adding significant value Rick. I’m sure my readers will want to know more about how your adds work.

      Jim

  8. Rick brings up a great point regarding Proprietary Change of Address (PCOA) solutions.

    Simply reaching compliance w/ NCOA requirements has allowed marketers to see the value (and impact) address hygiene can have on the deliverability and profitability of a direct mail effort. However, many marketers still fail to realize that NCOA has its shortcomings…

    Here are some quick facts marketers should know:
    – NCOA-link is a self-reported database from the USPS
    – Only 56% of new movers actually self-report and end up on this file
    – Leaving 44% of new movers to go untracked by the process (53,000 movers per day!)
    – As a result, the USPS estimates that the average acquisition campaign (without a PCOA solution) will still have a 7-10% non-deliverable rate

    We provide our clients with a free hygiene test simply to make them aware of these issues…and we’ve seen some dirty files including MAIL READY files with double digit non-deliverable rates and even a collections file with the same individual record repeated 22 times (how’s that for a waste of money Jim?)!

    Anyways, please spread the knowledge… very few marketers truly understand the impact a PCOA solution might have on costs, response rates, CPL, and ROI.

    Good luck!
    Erik Koenig

    • Thanks Erik!

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