Help stop the internet sales tax…


Important information to act on now.  (thanks to our friends at ACMA for allowing us to share this)

Urgent Industry Alert:
CEOs, Presidents: Last Call To Make A Difference;
Contact Your Senators Monday

Dear Catalog Industry Executive:Whether you wrote last week or didn’t get a chance to yet, the Senate is scheduled to take action today. The Marketplace Fairness Act will definitely cost you money and could potentially ruin your catalog business. The industry needs all C-level executives to call to Senate offices right away. Let’s light up the lines. It will influence the result, especially if they know you – but call either way. This is our last chance to make a difference. Do not delay. For starters, please check out this editorial in today’s Wall Street Journal, as it can greatly help our cause and yours when you make your calls.Click on each title below for all the important tools you’ll need:

Click here to review the details ACMA distributed in our alert from Friday
Last and not least, we are working round-the-clock coordinating industry efforts, so we need to hear from you too. Please use the following address to let us know which actions you take: action@catalogmailers.org.
Sincerely,

Hamilton Davison
President & Executive Director
American Catalog Mailers Association
www.catalogmailers.org
hdavison@catalogmailers.org

Yours Truly quoted in the USPS’s Deliver Magazine on direct mail testing for The Fresh Diet


Despite my love/hate relationship with the US Post Office I still get quoted from time to time.  Check out this quote about how I built The Fresh Diet’s direct mail program.

BREAKING NEWS: US Postal Service makes a bold statement: No 2010 postal increases!


Note from Jim: The USPS may have finally learned the lesson that higher postal prices drive down direct mail volume – resulting in lowered not increased revenues.

To Postal Service Customers:

Many of you have expressed concerns regarding mailing costs for 2010. The tough economic climate has presented significant challenges to all of us and pessimistic speculation has suggested that postal prices could increase by as much as 10 percent.

As we begin a new fiscal year and as many of you, our business clients, are preparing your 2010 operating budgets, we want to end all speculation.

The Postal Service will not increase prices for market dominant products in calendar year 2010.

Simply stated, there will not be a price increase for market dominant products including First-Class Mail, Standard Mail, periodicals, and single-piece Parcel Post. There will be no exigent price increase for these products.

This is the right decision at the right time for the right reason. Promoting the value of mail and encouraging its continued use is essential for jobs, the economy, and the future of both the Postal Service and the mailing industry.

While increasing prices might have generated revenue for the Postal Service in the short term, the long term effect could drive additional mail out of the system. We want mailers to continue to invest in mail to grow their business, communicate with valued customers, and maintain a strong presence in the marketplace. Changes in pricing for our competitive products—Priority Mail, Express Mail, Parcel Select, and most international products—are under consideration. We expect to announce a decision in November.

We are committed to working with customers to find ways to grow the mail through innovative incentives like the Summer Sale and contract pricing. Mail is the most effective means of communication and advertising and we will continue to work together to increase the value of the mail. Mail is a smart investment for the future.

John E. Potter

We’re on a mission to create the best direct marketing education forum on Linkedin


3 weeks, 540 members strong. Join us: http://www.linkedin.com/e/vgh/2080726/ We have members from all area’s of direct marketing ready to share their expertise with you.  We also have international members.

Want to know more about search, blogs, direct mail, telemarketing, lists, social media, and all direct marketing disciplines, then join us.

If you are an expert in direct marketing, please join us too.  And our members are using this group as a great networking tool!

Thanks, we look forward to seeing you there. http://www.linkedin.com/e/vgh/2080726/

Jim Gilbert

Attention S. Florida Marketers, This months event in Ft. Lauderdale: Going Green and Getting Digital with Paper & Print


This Month… Thursday, July 16, 2009

Session 1 – The Truth Behind Cherries, Chocolate & Paper. The more paper you use, the better for the climate.

Speaker: Wayne Dennis, Corporate Director of Sustainability, Mac Papers

Learn why paper and print are the best environmentally responsible choices for marketers. Find the right shade of “Green” for your marketing efforts, how to measure your environmental impact and the best ways to communicate it to your audience.

Session 2 – Advancements in Web to Print technology: What it means to you and your customers.

Speaker: Gary Ritkes, Managing Director of Sales/Marketing, SproutLoud

Discover how web to print technology is transforming traditional printing processes and empowering marketers. Find out how you can deliver one-to-one marketing messages on demand via direct mail, e-mail and the web – all from your desktop!

Event Location: Westin Fort Lauderdale Cypress Creek

Time: 11:30 am – 1:30 pm

Grand opening of new Linkedin Group – Direct Marketing Questions & Answers


Linkedin members can join by clicking here: http://www.linkedin.com/e/vgh/2080726/.

This is the place to get all of your direct marketing questions answered.

And if you are a direct marketing expert, this is the place to help gain notoriety by helping direct marketers succeed.

Check it out and join!  And Happy July 4th weekend from Jim.

Update 7/7/09, since Friday including the holiday weekend, we have gotten 123 members, both experts and in various stages of their careers.

Attention South FL Direct marketers – Are you on track to meet or beat your forecasts?


Jim Gilbert and the FDMA are pleased to announce another great learning opportunity for you on June 18th.

The Second Half: Meet or beat your 2009 estimates and look like a superstar!

Thursday, June 18, 2009

While it feels like 2009 has only started, we’re actually halfway through the year. At this point the FDMA asks you:

• Are you on track to meet or beat your forecasts?
• What can you do to drive in more sales?
• What programs both online and offline can you test, and test quickly to increase sales?
• Are you drowning in a sea of online numbers and are not sure which are the most meaningful to track?

If you answered “yes” to any of the above questions, this is the one FDMA session you do not want to miss. We have two great presentations lined up for you.

Register now at www.fdma.org

PRESENTATION 1 – Leave NO Stone unturned – 50 tips, tricks and ideas you can take to the bank. (12:30 – 1:30pm)

Presented by Jim Gilbert, Author, Direct Marketing Professor and Consultant.

In this presentation, Jim Gilbert will leverage his 20+ years experience in teaching direct marketing companies how to increase sales – by providing you with marketing program ideas that are simple and quick to execute.

Jim’s presentation will address consumer and B2B, online and offline, lead gen and direct sales strategies and tactics – in short – marketing programs you may have missed. He will engage you in “operation turned stone”, an opening for you to look for breakthrough opportunities in your company to “find” missing revenue.

You are guaranteed to takeaway between 5 and 10 action items to beat your forecasts with.

PRESENTATION 2 – Interactive Metrics – What You Really Need to Know (1:30 – 2:15pm)

Presented by Maria Harrison President/Owner of iClarity.

In this informative presentation, Maria Harrison will take you through the good, the bad and the ugly of interactive metrics. Interactive marketing is a double-edged sword when it comes to metrics.

Just because everything can be counted, doesn’t mean it’s important in making business decisions that will help you have a positive impact on your interactive marketing initiatives.

Ms. Harrison will show you how simplistic interactive metrics can really be, how to set benchmarks, and develop meaningful executive dashboards that will help you make the right decisions to improve your interactive marketing efforts. She will define some basic interactive metric terms and teach you how to immediately apply those metrics to your business.

11:30 a.m. – 12:00 pm Registration Check-in and Networking
12:00 pm – 12:30 pm Annoucements, Lunch, Netowrkign at Table
12:30 pm Presentation by Jim Gilbert
1:30 pm Presentation by Maria Harrison
2:15 pm Program ends.

Register early to avoid additional $10 walk-up fee. Register now at www.fdma.org

Interested in attending our Board meeting at 10:00am and learning more about getting further involved with the FDMA, please let us know at 786-357-3275.

WHEN
Thursday, June 18, 2009 11:30 AM – 1:30 PM

WHERE
Westin Hotel Fort Lauderdale
400 Corporate Drive
(I-95 and Cypress Creek exit)
Fort Lauderdale, FL 33334

Marketing and Finance: the Peanut Butter and Jelly of Direct Marketing


Dad-12-2008

Stephen Gilbert, CPA, 12/31/08

Note from Jim: Today’s column is dedicated to the memory of Stephen Gilbert CPA, 1917 – 2009.   My father, friend, mentor, sounding board and business partner.

Over the years, I’ve written many times about the importance of financial acumen as a core competency for direct marketing success.

Many people seem to think direct marketing is about killer creative, or campaign management, or even great customer service. But to me, it always starts with the finances.

If I’m writing a circulation plan, it starts with the break-even analysis, right on down to the list and list segment level. Each segment of my housefile has a P&L and breakeven attached to it, then each drop, each season and each year.  I do this in advance, even three to five years in advance, using historical numbers. And I do it before each mailing or other type of direct marketing campaign to measure the success or failure of every campaign I do.  Remember, past performance predicts future behavior!

I’m also nuts about other financial analyses, such as lifetime value, squinch (square inch for measuring catalog space usage), cash flow, balance sheets, etc.

Now with social media all the rage, and multi channel marketing being the norm for mail order, catalog and electronic retailers, the need for financial measurement and knowledge is greater then ever.

To this day, I’m amazed at how many people I work with, smart people, still want to practice direct marketing by the seat of their pants. To me, marketing just doesn’t make much sense without financial understanding….

Too many direct marketing companies think they’re brands…

Too many direct marketers think they “know” what their customers want and, hence, perform no analysis…

Just pull the trigger and see what happens!

But, there was a time in my career — when I started my first business, a publishing company — that I had no interest in the numbers. My father, a certified public accountant, took care of that, leaving me to market, sell and manage the day-to-day operations. I made many mistakes working that way, which my dad was quick to point out. So I learned, and learned quickly, thanks to him.

Many times, the disconnect between marketing and finance has been immediately evident to me the first time I walked into a company. And many times over the years I’ve brought my dad in to work with clients and client-side companies I’ve worked with. He’d communicate the top line, help organize the finances and financial analyses, and I’d address the bottom up marketing planning. Together we helped some companies turn the corner and grow, and save a few from ruin.

Direct marketing is a numbers based business.  Don’t do the math, and there are a myriad of ways you can find yourself in jeopardy.  Does your company think that way?  It could be critical to you and your company’s success.

What is strange is that as a kid I hated numbers — I was horrible at math — but I learned much from working with my father; a patient teacher.  The principles I learned I apply every day, even passing them on to you.

I wasn’t really planning this week’s column as a tribute, but — and apologies to you for getting maybe a bit too personal — I believe it’s fitting.

We are entering a new age of direct marketing that is much more complicated.  The internet has changed everything.

If you consider the impact of multichannel marketing and social media, coupled with the degree of difficulty and challenge each of these presents in terms of financial measurement, maybe this week’s column is actually right on the money!

NewPage To Help Catalogers Reach More Consumers (passing it on)


Note from Jim, This was sent to me from a catalog industry contact.  Not sure about the company or the offer, but passing it on anyway as it seems interesting.  Investigate wisely!

MIAMISBURG, Ohio – May 1, 2009 – NewPage Corporation, a leading producer of publication papers in North America, has launched the “Free Paper to Reach More” campaign that aims to help retail catalog companies reach more consumers. The campaign will award five catalog companies with a grand-prize of 100 tons of paper to reach approximately 500,000 new prospects for a typical cataloger.

NewPage developed the “Free Paper to Reach More” campaign in an effort to help catalogers expand their marketing efforts at a time when economic pressures are forcing many companies to reduce their outreach. “In today’s economic climate, catalogers face considerable challenges such as rising production costs, higher postage rates and reduced retail sales,” said Jim Sheibley, general manager for NewPage. “Subsequently, many are trimming prospecting efforts and downsizing current print runs and publications.”

NewPage is committed to fostering sustainability within the catalog industry. One of those commitments is the “Free Paper to Reach More” program that will help catalogers reach additional consumers, ultimately growing their business to be more financially viable long-term. Another commitment is to providing environmentally sound products that cater to the catalog segment. NewPage has the broadest line of chain-of-custody certified and recycled papers that fit catalog specifications while demonstrating the catalog company’s environmental responsibility to their consumers.

NewPage will be showcasing the campaign at the Annual Catalog Convention in New Orleans from May 4-7. Visit their booth (#901) or http://www.FreePaperFromNewPage.com for campaign details.

About NewPage Corporation

Headquartered in Miamisburg, Ohio, NewPage Corporation is the largest coated paper manufacturer in North America, based on production capacity, with $4.4 billion in net sales for the year ended December 31, 2008. The company’s product portfolio is the broadest in North America and includes coated freesheet, coated groundwood, supercalendered, newsprint and specialty papers. These papers are used for corporate collateral, commercial printing, magazines, catalogs, books, coupons, inserts, newspapers, packaging applications and direct mail advertising.

NewPage owns paper mills in Kentucky, Maine, Maryland, Michigan, Minnesota, Wisconsin and Nova Scotia, Canada. These mills have a total annual production capacity of approximately 4.4 million tons of paper, including approximately 3.2 million tons of coated paper, approximately 1.0 million tons of uncoated paper and approximately 200,000 tons of specialty paper.

For more information, please visit our Web site at http://www.NewPageCorp.com.

Why Catalogs Fail


Note from Jim: This is the second and final in a series of articles from fellow consultant Bob Klapprodt. I’ll be back with another column next week.

Why do catalogs fail? The answer is deceptively simple, while the remedy is not. 

Most catalogs fail because they walk away from the basics; they ignore the elementary economic analyses necessary to properly measure and control the business.

The Other Guy’s Model
In the vast majority of American businesses, fixed costs are high and variable costs are low. For example, in the retail arena, companies can increase sales simply by staying open longer. The variable cost may be merely the salary of a clerk for an extra hour. 

By monitoring the top line, you can fairly accurately estimate the impact on the bottom line. To increase profitability, all you need is enough incremental margin to cover low incremental costs.

Our Model
For catalogs, just the opposite is true: Fixed costs are low and variable costs are high. In the most traditional cases, the way to incremental sales is through mailing more catalogs. Mailing includes increased printing and postage costs, the two highest budget lines of a catalog operation. 

I normally provide my clients a model P&L that shows fixed costs should run around 7 percent of net sales, while mailing costs should be in the 30 percent range. Very few consumer catalogs can fit into this idealized model.

The result is that many catalogs lose sight of this and end up overmailing. Incremental margin is far outstripped by incremental costs — and this can happen in a hurry. The bottom line goes from black to red, and the catalog is in trouble. 

The beauty of direct marketing is that when a catalog is growing, you can monitor the pieces of your growth and add circulation to list segments that are performing above average. Your P&L is in the black, and life is good.

Why, then, is it so difficult to cut circ when times are bad? Why is it so difficult to monitor the impact of incremental costs that are necessary to gain incremental sales? The answer is, It’s not if you stick to the basic economic fundamentals. Go find the marketing analyst sitting in the far corner of your office; he/she has the answer. If you don’t have one of these analysts, you’re probably already in trouble and don’t know it … yet.

When times are bad, the normal response is to cut overhead. This is exactly the wrong response. Constantly monitor results at the micro level, understand when incremental costs exceed incremental margin, then react by re-evaluating your circ. Cut it when you have to. Leave your overhead alone unless you’re going out of business.

It’s All in the Analysis
The first thing I do when taking on a new client is I go back through two to three years of history and look for instances when incremental costs are too high to support the incremental margin. I’m constantly amazed by the number of times this happens. This is a very sensitive analysis; it doesn’t take much to turn the numbers red.

If you understand response curves and know how to accurately forecast your results, you don’t have to wait for a mailing response to be complete before you undertake this analysis. I’m a spreadsheet geek, so I build this measurement into all my analyses and can tell early on when things are headed south — and by how much.

How to Measure, What to Measure
If you’re a catalog owner, do the analysis. Do it every week. Constantly measure your incremental sales, and compare them to your incremental costs. And don’t forget the cost of taking and shipping an order; this can make a big difference in the results. Your bottom line will thank you.

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