The Postal Direct Mail Nightmare Continues: BREAKING NEWS: USPS Appeals Exigency Rate Case


Note: this just in from our good friends at ACMA
October 22, 2010 

Special Bulletin: USPS Appeals Exigency Rate Case
 

 

Dear Catalogers, Suppliers & Others With Catalog Interests: 

While mailers were still rejoicing over the victory on the exigency rate case, the USPS filed a lawsuit today in the U.S. Court of Appeals to reverse the widely heralded Postal Regulatory Commission decision. The Postal Regulatory Commission on Sept. 30 denied the USPS’s extraordinary request for a well-above-inflation-rate postage price increase that would have effectively nullified the Congressionally-imposed rate cap.

 

In its latest filing, the USPS requests a review of the PRC’s interpretation of the law that governs how prices are set and asks the Court to confirm it has the right to file an exigent price increase. It also seeks clarity regarding the rules governing how an exigency increase will be applied should it find itself in a similar situation in the future. According to a USPS statement on the matter, it is also reviewing other options open to it in light of the PRC ruling.
What does this mean to you? Right now, it is a little hard to say definitively. Courts have historically sided with regulators provided it can be demonstrated the regulator followed its own rules and practices in arriving at a decision. We know of no basis to conclude otherwise at this point, indicating the PRC decision should stand. However, clearly USPS execs have an approach they believe has merit, or they would not have gone to the cost and trouble of an appeal.

ACMA’s Approach
As it has all along this process, ACMA will monitor developments closely and may decide to intervene alone or with others supporting the PRC decision. Unfortunately, this development puts into question how much you should budget for the coming year. Until further information is available that suggests otherwise, we recommend sticking by earlier forecasts we gave to members, but you can be sure we will stay close to this matter and let you know when a clearer picture is available. 

Happily, ACMA has some money available from its Special Fund and general coiffeurs that give us options as to how to proceed. This is a great reason why it is in your best interests to make sure you have a properly resourced group to address unexpected developments quickly to protect your interests.

More to come…

Sincerely,

Hamilton Davison
President & Executive Director
American Catalog Mailers Association
Direct: 401-529-8183

The Direct Mail Myth Busting Continues.“preferential attitudes on trustworthiness of mail strengthened for consumer respondents in all age groups from 2008 to 2010”. Take that you naysayers!


My good friend and fellow direct marketer Evelyn Milardo posted this on Linkedin.  Some great and surprising stats about direct mail vs online here:

Young adults strongly prefer Offline to Online sources for marketing offers reveals Epsilon’s ICOM 2010 North American Research. Depending on the product category, the survey results Show 2-1 and 3-1 offline preference margin.

Six years after the launch of Facebook, North American consumers in the valued 18-34 year-old demographic prefer by a wide margin to learn about marketing offers via postal mail and newspapers rather than online sources such as social media platforms, according to national survey research from ICOM, a division of Epsilon Targeting.

Additionally, the ICOM research shows that preferential attitudes about the trustworthiness of mail strengthened for consumer respondents in all age groups from 2008 to 2010.The 2010 study of 2569 U.S. households and 2209 Canadian households focused on consumer preferences in regard to the ever-expanding array of communications channels for the delivery of marketing information, offers and promotions. Responses came from consumers ranging in age from 18 to 55 and above.

By the numbers, here are some of the key results from ICOM’s 2010 study of North American consumers’ marketing communication channel preferences –

For household and health products, the preference among 18-34 year-olds for receiving marketing information from offline sources led by mail and newspapers is 2 to 3 times greater than online sources such as social media. Examples of consumer preferences for offline versus online are:

Personal Care products – 62% offline, 22% online

Food products – 66% offline, 23% online

OTC medicines 53% offline, 22% online
Prescription medicines 45% offline, 22% online

Understandably,travel was the exception, where 18-34 year-olds preferred online to offline information by a 42% to 35% margin. However and this really BIG – Insurance and Financial Services followed the overall trend, with the 18-34 age group preferring offline sources 43% to 21% and 44% to 19%, respectively.

Stay tuned – more to come.

BREAKING (GOOD) NEWS: postal-regulatory-commission-denies-exigent-rate-increases


The Postal Regulatory Commission Denied the Postal increase.  Read about it here

http://www.dmnews.com/postal-regulatory-commission-denies-exigent-rate-increases/article/180018/?DCMP=EMC-DMN_iMktingNewsDaily

We at Gilbert Direct Marketing, applaud the PRC for denying the exigent postal rate case.  As I have said before every penny direct marketers have to spend on direct mail, with it’s biggest expense already postage, we have to add 2 cents of revenue to cover the increased costs.

Despite its negative image lately, mostly fostered by environmentalists and internet marketers, direct mail remains a highly targetable and enormously profitable marketing channel.  Presently I have clients who are seeing ROI in the range of 6 to 1.

FAIL: As an online marketer I applaud the US Postal Service for it’s Exigent Rate Case. Read my letter to them


Dear Mr. Postmaster General and the honorable members of the Postal Regulatory Commission,

As an online marketer, I want to thank you. I cannot wait until you raise postage rates come January. Now some people may not agree with me, but I applaud your efforts to consistently raise postage rates.

As I was starting my business a few years ago, you announced an incredible postal rate increase — if I remember correctly, around 20 percent — that really helped my business take off. So many direct marketers, who could no longer afford to profitably mail catalogs and other direct mail, came calling. As a result, my business flourished (as did many of my comrades in the online space).

Now I hear you’re on the verge of passing something called an “exigent” rate increase, pushing postal costs up another 5 percent.

Very cool, thanks!

I also love how you got around the specific language that was designed to keep you from arbitrarily raising rates. :-)

Right now I bet many direct marketers are pretty angry with you. They’re probably feverishly calculating their profit-and-loss statements to determine how many previously profitable mailing lists aren’t going to be profitable anymore. How fortunate for me. I wonder how many new customers I can pick up come the first quarter?

And one other thing I want to mention as long as you’re reading this: You know those summer postal “sales” you’ve had the last two years? Yeah, those ones where the criteria for qualification to receive the discount are ridiculously hard for mailers to meet? Well, I really appreciate your help in disillusioning the direct marketing community. Remember, the more jaded and disillusioned it becomes, the better for my business.

That’s it for now. I hope this letter finds you all well. Keep up the good work — my business needs it!

Sincerely,
Steven M. Search

EDITORS NOTE: Some people, mostly internet marketers, are commenting on linkedin that they applaud this article – like it’s real!!!  Folks, this post is meant as pure acidic sarcasm and irony.  Its intent is to skewer the USPS, The Postmaster General and The Postal Rate Commission for their stupidity in biting the hand that feeds them, and single-handedly destroying their future earnings potential as they drive marketers out of a highly targetable and profitable channel.  I find it both humorous and horrifying that people would take this post literally.

Jim

From Politico and SEN. SUSAN COLLINS: Rate hikes won’t help Postal Service!


if you are in the direct mail business, or you ship packages via the USPS (also known as The US Postal Service), read this article now from Senator Susan Collins and as published on Politico.  Click here for the story (and a definition of what Exigent Circumstances SHOULD mean to the band of thieves called Postal Rate Commission)

For a sarcastic look at what a field day our good friends at the US Postal Service are providing the internet marketing industry, click here

I find it totally inconceivable how stupid the USPS, The Postal Rate Commission and Postmaster General Potter are.  Every penny they increase postage for our direct mail campaigns means we have to get 2 cents more per piece mailed in order to be profitable.  That means profitable mailers (and lists) become marginal or worse.

Another article I wrote that addresses this issue is: How To Heal The USPS in 8 Easy Steps.

How These Call Center Training Techniques Can Increase Your Call-Center Conversions


As direct marketers, we spend a great deal of time and money developing programs to make the phone ring. But it’s the call-center agents that truly make the cash register sing.

Therefore, I spend a great deal of time training customer service reps (CSRs) to be powerful brand advocates with the ability to make a difference with all customers. Personally, I hate calling a company and hearing some disinterested rep deal with my order in a lackluster way. It tells me the company I’m dealing with doesn’t get that the people manning the phones are the voice of the company.

A simple CSR training program can solve the lackluster attitude and increase conversion.

CSR’s should be trained to think on their feet rather than interacting with customers and prospects by reading a script. Of course, good call-center software with a scripted environment can be beneficial, but even the best scripting can’t beat a well-trained CSR’s instincts. It’s important to hire reps that can work this way, and then mentor and monitor them on an ongoing basis. A word of caution: Analyze call times to ensure your reps aren’t burning up phone time with the personal touch.

CSR training programs are quite simple. You don’t need elaborate monitoring equipment. Simply use a cassette recorder and some basic monitoring equipment you can buy at Radio Shack to record CSRs’ calls for a day, then listen to the tapes. Break the reps into teams of three or four and sit in a room together and listen to the day’s calls. Teach the reps to listen actively and objectively to the calls.

Let them coach each other on the cues and buying signals that sometimes get missed in real time. If you spot a missed buying signal, stop the tape — I encourage all of the reps in the group to stop the tape if they hear something — and role-play how the rep could’ve made a difference in converting the call.

Set up contests during the training process for the individual CSR and training team that generates the highest conversion rates. Drill the reps on making sure to be gentle and not pushy, as it’s human nature to get more aggressive to win a contest. Stress the quality of the relationship with the customer as well as the quantity of the order.

Using this simple technique at one company I worked with, we increased conversion rates by as much as 20 percent. Also, by fostering an atmosphere of teamwork and healthy competition, we increased the enthusiasm and morale in its call center as well.

Train CSRs to seek out opportunities to cross-sell effectively. Let your reps know which items complement each other, and coach them on the art of cross-selling. Truth is, sometimes all it takes is a suggestion, something like, “Do you know, Ms. Jones, that we have a beautiful top that complements the shorts you’re purchasing today?”

Your Call Center is Bleeding! – Connecting the Dots of Your Customer Touchpoints, Part 2


In part one of this series on customer touchpoints, I defined touchpoints as all the points of contact between your company and its prospects and customers. In part two, I look at one of the two main touchpoints: your call center.

Before I start any discussion on call center and web results, I always tell clients, “Look out — what you’re about to hear may bruise your egos.” I offer that same warning to you.

Here goes …

No matter what company I visit, I always come away with the same thing: They’re not as efficient at converting sales as they could be. I get that knowledge the old-fashioned way: I listen to calls in the call center, and I make a number of test calls externally. I also go to a client company’s website and order a product (or attempt to, in some cases).

First Off, the Call Center
There are just too many missed opportunities in the call centers I evaluate. Missed buying signals, missed cues, reps not listening effectively, etc. I also see environments that are too tightly controlled and scripted, and others that are totally unscripted.

Of course when I tell clients this, often times I get a blank stare, like, “What do you mean my call center sucks? Do you know how much effort I put into technology, people and training there?”

And sometimes, right there, the messenger gets shot! But in truth, this does happen, and if you’re willing to spend time listening, you’ll hear it too. We reconvene here in two weeks. When we do, I’ll offer some simple call-center training techniques I’ve used to increase sales conversion rates by as much as 20 percent.

In the mean time, please listen to your calls, make test calls to your call center and soak in as much as you can. You may be in for an eye-opening experience. This is especially true if you’re in another department or are an executive in your company.

After the call-center training in my next post, I’ll move into web orders and how you’re missing the boat there.

Oh, and a last point: If you don’t have a call center, you ARE missing sales. We’ll discuss that next week, too.

Use these tips to connect the dots of your customer touchpoints, Part 1


Direct and multichannel marketers encounter moments of truth that make or break their sales and marketing effectiveness multiple times each day. How they interact with customers, prospects — essentially all consumers — is critical to their success.

Direct marketers touch consumers in both traditional (call center, website) and nontraditional ways (mobile, social media). Reputation management is everywhere.

Marketing in the 21st century, with the internet and social media in play, has become even more of a challenge as direct and multichannel aren’t fully in control of all of the messaging that’s communicated to (and between) consumers regarding their brands. This is why today’s brands need to make sure that all client-facing activities are buttoned up, in sync and consistent across all channels.

Well, at least that’s the goal to shoot for!

Over the coming weeks, I’ll be writing a multipart series on how to maximize results in all selling channels and at all consumer touchpoints — from your call center to your website to your Facebook page.

But before I get started, I want to offer you a challenge. I have some questions for you to ask yourself. I want you to become a detective in your own organization. And I don’t care if you’re the CEO or a customer service representative in a call center. Try the following:

  1. List all of the points of contact your customers and prospects interact with you in. The more specific, the better. For example, if you use landing pages for marketing campaigns, list them.
  2. Get out of your office. Go to your call center and listen to multiple customer service and sales-oriented calls. Do searches on your company name and/or products to see what your reputation is in the social mediasphere.
  3. Do a complete audit of all of the places your brand touches consumers. Note the good and the bad.
  4. Get others in your organization involved. My best suggestion to you is to get your CEO to put together a customer experience team to investigate the above. It should meet weekly to discuss its findings. Then build a plan to ensure your touchpoints are doing exactly what you want them to do — i.e., driving sales and engagement.

Stay tuned for part two of this series in a few days. But in the meantime, go ahead and post your comments, suggestions and even fact findings below

Choose the right design team for your direct mail creative (a primer)


When clients come to me with questions about starting a catalog and/or direct mail program, invariably the subject of creative development comes up. This is the question: Should it be handled by their internal creative department (despite its limited knowledge of direct development), their agency (which really knows the business) or someone else entirely?

My answer is always this: Choose designers who specifically know the mail order market. Why? Consider the following: Catalogs/mailers accustomed to generating sales via mail/internet ordering are a very different animal from a branding vehicle. They may look similar, but companies that create mail order catalogs and direct mail know exactly how to leverage creative that not only builds their brands, but also sells product. That’s the key difference. What looks simple is actually highly specialized and technical.

Beautiful doesn’t always sell. Direct mail design companies know how to generate sales for a couple of reasons:

  1. They understand the key drivers of stimulating response.
  2. They understand the budgetary constraints that separate mail order from brand building.

How to Start, Who to Choose
If you’re entering the direct mail arena for the first time, you’ll likely have a limited testing budget and no time to figure out how to build mail order creative on your own.

A catalog-specific or direct marketing agency, especially one with specific knowledge in your category, should be a core member of your team. Start by contacting a number of these creative agencies and invite them to develop creative concepts for you. You’ll immediately see who gets your business and who doesn’t based on their comps.

In choosing an agency, look for one that does all facets of the production process, from photography to layout and design, and even pre-press (or pre-media, as it’s often called now). That gives the agency a major stake in the process and provides you with complete accountability.

You’ll also see a wide range of prices for building your catalog or direct mail piece. Gauge the price/performance ratio of direct marketing. Remember this as you review pricing: Every penny more your mailer costs per unit, you need to generate 2 cents more in sales. And don’t skimp on design. A good design company can help you balance this out.

Direct mail serves a strategic purpose. Do the math up front to calculate your break-even points and projected P&Ls. Don’t get so hooked on the creative that it takes on a life of its own. Photo shoots and design are the “sexy” side of the business, but you make your money based on targeting the right product to the right market, and then building creative to speak to that market in a manner that sells.

Thus, I implore you to remember the 40/40/20 rule. Lists and offers (merchandise) make up a combined 80 percent of the potential impact you can have on your direct marketing efforts, while creative comprises only 20 percent.

Are you automating your emails with trigger and drip campaigns? (an overview and 3 good tips)


Lately I’ve been working with clients on automating their marketing tasks, specifically their emails. The more I work in this channel, the more I realize how wide-open a frontier — with a huge upside — it is for cross-channel merchants.

Most medium- to high-end email service providers (ESPs) offer some sort of automated functionality. This gives marketers the opportunity to create “set-it-and-forget-it type” campaigns.

When you acquire a new prospect, for example, you can create a triggered drip campaign. A drip campaign involves a series of emails that are sent to prospects at pre-specified intervals, say once a week over a four-week period.  Each email is designed to either highlight a key company benefit (part of the unique selling proposition), or have a series of progressively stronger offers.

Most ESPs have application programming interfaces available to their clients. By having your IT folks set this up, your ESP can automatically communicate with your database. In simple terms, once a prospect becomes a customer, no more drip emails are sent to them as they move to a different bucket (customer) in your email database. And once prospects become customers, they’re promoted into a different automated email series.

You can set up campaigns for all of your customer statuses — prospects, single, multibuyers, past customers, gift purchasers, cancels and so on. The sky is the limit based on your creativity.

Furthermore, some ESPs have pretty good list management tools available for automated and/or one-off campaigns. For example, a client of mine chose Bronto’s solution, which allows it to store 100 different customer attributes. It can then create campaigns based on whatever criteria meets its needs from Bronto’s list selection module. Want to send an email to someone whose birthday is coming up? It’s simple: Whatever data you collect from customers and prospects can all be sliced and diced within a good ESP’s system.

Try the following three ideas for triggered email campaigns:

  • customer satisfaction surveys X number of days after a purchase;
  • tell-a-friend offers when customers becomes multibuyers; and
  • customer reactivation emails. Instead of doing a query each time you want to send a reactivation message from your internal database and uploading a new list, just create it for X number of days/months/years and the message automatically goes out.

Of course, no new form of direct marketing should be done without testing. Test offers, creative and especially the timing of your messaging.

You’ve worked hard, now let email marketing automation help you drive revenue! Are you automating your marketing efforts? Tell us how it’s working by posting a comment below.

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