Advertising
Getting Results With Mail Listsby Ernest Nicastro
"I would to God thou and I knew where a commodity of good names were to be bought..."
William Shakespeare, King Henry IV
When direct marketing guru Gary Halbert used to give classes on copywriting and direct mail marketing he would ask his students the following question:
"If you and I both owned a hamburger stand and we were in a contest to see who would sell the most hamburgers, what advantages would you most like to have on your side?"
As Halbert tells it the answers would vary. Some people would say they'd like to have the advantage of superior meat. Others wanted the advantage of a superior location for their hamburger stand. Still others would voice their preference for the competitive edge of lowest prices.
Then, when the students were finished stating what advantages they would most like to have, this is how Halbert would respond:
"OK, I'll give you every single advantage you have asked for. I, myself, only want one advantage and, if you will give it to me, I will whip the pants off all of you when it comes to selling burgers! The only advantage I want, is a STARVING CROWD!"
Think about it. No matter what product or service you sell, the single biggest advantage you can have is - in the parlance of Shakespeare - "a commodity of good names." And good names are groups of people (target markets) who have demonstrated that they are starving (or at least hungry!) for your particular product or service.
The Importance Of Good Mailing Lists
For example, I recently received a direct mail package selling a book on direct marketing strategies and tactics by one of the industry's most respected and accomplished experts. Do you think I have a hunger for this type of product? You bet I do, maintaining an up-to-date knowledge base is vitally important to my - and my clients' -success.
I satisfied my hunger and bought the book. And one of the chief reasons the publisher made this sale, and the others that it made with this mailing, is because it targeted its offer to the right group of people. The publisher selected the right mailing list.
Compiled Mailing Lists
Mailing lists can be divided into two major categories: compiled mailing lists and response mailing lists. In this article, we'll focus on the characteristics of compiled mailing lists and how to use them to your advantage.
What is a compiled mailing list?
Compiled lists are made up of names and addresses derived from directories, associations, government data, phone books, auto registrations, trade-show registrations, memberships and the like. Simply stated, compiled lists are made up of groups of people with something in common. Use a compiled list when you want to target an entire market or a specific sub-section of a market. For example -
every pharmacy in a particular state
every RV Owner in a certain city
every software company CEO in California whose company has between 50 - 99 employees
new homeowners with household incomes of $70,000 who live within 10 miles of one of 300 furniture stores in a particular chain.
What information does a compiled mailing list provide?
Here, taken from a new mailing list announcement in a leading trade magazine, is the type of specific details readily available to you about compiled lists:
"Telecommunications Executives: This compiled file is comprised of executives who work in the telecommunications industry or who are responsible for telecommunications activities and concerns within their companies. Selections offered at no additional charge include: cellular communications, fiber optics, laser product manufacturers/consultants/data processing executives, as well as telephone industry executives. The base list price is $60/M."
How much do compiled mailing lists cost?
Compiled lists will rarely generate as high a response rate as response lists (magazine subscriber, mail-order buyer and direct response inquiry lists). On the other hand, rental rates on compiled lists, at $30 - $60 per thousand names vs. $80 - $100 per thousand, are substantially lower than those for response lists. That leads to this important point: While compiled lists will almost never perform at the same levels as response lists rarely will their performance be 30 percent to 50 percent less.
And compiled lists, unlike response lists, can be purchased for unlimited usage over a 12 month period. Typically, the cost is charged at twice the rate of a one-time rental.
Important Note: Unless your agreement with the list company states otherwise you may only mail to the list one time. Once an individual has responded to you then that "name" becomes part of your "house list" and you may mail to it as many times as you like.
Marketing Databases: Data-Enhanced Compiled Lists
In its simplest (and cheapest) form a compiled list is nothing more than a collection of names with something in common. A Marketing Database, on the other hand, in addition to names and addresses, contains additional data about the people or businesses on the list.
Large list and business information services companies such as Acxiom (www.acxiom.com), InfoUSA (www.infousa.com), Trans Union and others maintain and continuously update extensive marketing databases that offer additional insight and knowledge about prospective customers.
For example, in February of this year Trans Union, a major consumer credit information company, launched the Business Information Group (BIG) (www.transunionbig.com). BIG's business lists offer marketers a wide array of geographic, demographic and financial selection criteria to choose from including: SIC codes, ownership characteristics, yearly sales, sales growth, business credit card data, total debt, net worth and other information.
Plus, through its Business Executive Link product, BIG gives marketers the ability to link 5 million business executives to their home addresses and obtain information about their income, spending habits and credit.
Other types of business information readily available from a variety of business-to-business marketing databases include the following information:
Size of ad in the Yellow Pages
Whether a home-based businesses
Fax number
Name and title of secondary contact
Credit rating.
On the consumer side there is a seemingly limitless supply of information available from marketing databases that gives direct mail marketers the ability to target people on the basis of numerous criteria, including:
Demographic data -- their education level, the age ranges of the household's adults and children, their income level and ethnicity
Purchase behavior data -- if they're mail order buyers (and if so, if their spending is low, medium or average), credit card users, PC products buyers or photographic equipment buyers, and the date of the most recent retail activity
Lifestyle data -- if they're interested in art/antiques, collectibles, electronics, gardening, grandchildren, golf, real estate investments, self-improvement, power boating, etc.
Marketing databases offer a motherlode of information that can be effectively mined for profitable results. Here are two simple, yet effective ways different types of organizations have used marketing databases.
A car dealer wants to target people who are in the market to buy a car in the next few months. It taps into database files that show people whose past purchase behavior indicates they buy a new vehicle every three years and how long it has been since their last purchase. The dealer also mines a different database and identifies households with teen-agers approaching driving age.
An event management company wants to identify and target better qualified exhibitor prospects. It analyzes data on the top exhibitors currently doing business with them, zeroing in on the most prevalent SIC codes. The company then builds a prospect list from a marketing database consisting of select names from the same SIC codes. And, because it wants to target only corporate-level decision-makers, its selection criteria excludes branch office locations.
Pricing
The pricing structure for lists purchased from a marketing database is analogous to dining out at a fine restaurant where all menu items are priced on an a la carte basis.
For example, renting a list of homeowners would cost you approximately $30 per thousand names. But for a more targeted marketing effort you might want to supplement this core data by specifying that each homeowner also meet one or more of the following criteria:
Are college graduate - $7/M
Are in the 45-54 age range - $7/M
Have an estimated household income between $100,000-$124,999 - $7/M
Have an interest in powerboating - $7/M
Own a dog - $7/M
Have children between the ages of 6 and 10 years old - $7/M
Live in a home that was built between 1971 - 1980 - $7.50/M
Are PC products buyer $10/M
This is just a small sampling of the many criteria a consumer marketer has to choose from. And, of course, how focused you want to be will largely depend on the product or service you're offering.
Probably the most economical way for many organizations to utilize marketing databases is through the purchase of one of the CD-ROM products on the market. Available in a variety of forms from a number of companies, including InfoUSA, iMarket Inc., Corptech and others, these products enable you to search thousands of records from your desktop computer and, once you've selected the files you want, download them directly into your contact manager.
These products can be used to target businesses and consumers on a local, state or nationwide basis. Prices range from $99.95 to several thousand dollars depending on the product and its capabilities.
In addition, you can search on the Web for many marketing databases and compiled mailing lists, order them and download them directly into your contact manager. One company, ThinkDirectMarketing (www.ThinkDirectMarketing.com), now provides online access to over 130 million consumers and businesses. For a $195 annual subscription fee marketers can perform unlimited searches and download up to a quarter of a million names during the course of the year.
In summary, effective direct mail marketing is a good offer sent to the right person. On the other hand, "junk mail" is a good offer that's sent to the wrong person. Using compiled lists and their close cousin, the marketing database, will help you zero in on the right person and significantly increase the likelihood of a positive response and profitable results.
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Copyright© 2002, Ernest Nicastro. All right reserved. For information contact Frog Pond at 800.704.FROG(3764) or email susie@frogpond.com.
