By David H. Martin
It almost seems that every month brings a new threat to low-cost dealer lead generation media. Just in the last six months, we’ve seen the enactment of the national “do not call” list that greatly restricts outbound telemarket-ing, and a new “do not fax” list that could put a damper on commercial/industrial (C/I) lead generation. Meanwhile, widespread public support for anti-spam legislation, not incidentally, threatens legitimate email marketing as well as “junk” email. Now, on the horizon, comes a direct threat to conventional 30-second TV advertising as we know it. DVR, or digital video recorders, make recording up to 100 hours of TV programming much easier than with videotape recorders, which require tape changes or rewinding. They also allow for easier skipping through a video digitally, allowing viewers to jump not only over program segments but commercials as well.
A recent Yankee Group (consumer research) study predicted that TiVo and other digital video recorders will be in 20 percent of U.S. homes by 2007. Couple this with research that shows roughly 70 percent of DVR owners skip the commercials. Another DVR called ReplayTV promotes its QuickSkip feature that allows users to “skip through your show thirty seconds at a time to get to the stuff they want to see. Make an hour-long program 40 minutes by skipping over the fluff.” (The “fluff” they skip may be your paid TV commercials!) The same study predicts that the anticipated reduced effectiveness of television advertising will have the greatest impact on small retail advertisers who often have low-cost production commercials that are especially likely to be skipped.
The DVR threat to local TV commercials is real but, with present DVR penetration at less than two percent, its effects are negligible. Still, that’s bound to change. So, what’s a dealer to do?
Back to the future
One manner of responding is a return to yesteryear through “snail mail.” Last year’s postal rate increase added to the challenge water treatment dealers face to “reach out” to new prospects in their local marketing areas. One form of mailing, though, remains more cost effective than others. Some call it “shared mail” while others call it “marriage mail.”
All shared mail programs combine a number of individual advertisements of several clients into one self-mailer or envelope, and deliver them to homes via mail or private carrier delivery (PCD). The costs of postage and handling charges are shared among all participating participants so the cost is substantially lower than solo mail.
According to the Direct Marketing Association (DMA, www.the-dma.org), shared mail is a $2 billion segment of the $49 billion direct mail industry, one that’s growing over six percent per year. To maximize the effectiveness of the print advertisement and capture the consumer’s eye quickly, include:
- A headline that reminds the consumer of the problem or need they currently have, or announces a limited-time offer with a need to “act now”
- A photo/graphic that visually reinforces the problem, need or solution
- A subhead that introduces the consumer to the company uniquely suited to meet their need
- Body copy that gives the consumer instructions on how to acquire the solution
- A “payoff” or other promotional offer(s) that gives the consumer more than one way to save with the company that meets their need
Coupons are also very effective because they’re valued and retained for reference.
King of sharing
The single largest private customer of the U.S. Postal Service, Advo (www. advo.com) serves over 23,000 clients each year, primarily retailers and service providers. Founded in 1929, it’s the company behind the ShopWise™ shared mail and Missing Child postcard programs that are regularly seen in mailboxes. Advo’s America’s Looking For Its Missing Children® postcards have, since 1985, become the single most recognized mail in the United States with 92 percent consumer awareness.
Each week, Advo distributes up to 85 million missing child cards nationwide including targeted areas where law enforcement agencies believe specific missing children might potentially be located. The well-known and recognized cards feature photographs and details regarding missing child cases and are distributed via mail to recipients of Advo’s ShopWise™ advertising insert package. The backside of each card contains a promotional message from a local advertiser. The program has been lauded for its success rate in helping find missing children across the country.
Advo’s ShopWise self-mailers typically include several pages of targeted offers from local retailers and service companies. Advo distributes ShopWise mailers to over 60 million households weekly, reaching nine percent of the households in nearly all of the top 150 markets, according to the company. Advo claims 90 percent of household purchase decision-makers read advertising mail each week. Also, each week, 52 percent of consumers make a purchase decision based on coupons, ads and special offers received in the mail. People read advertising mail because it helps them to plan their shopping. Advo claims ShopWise has a 42 percent response rate. The company offers a very useful Target Market Mapping Service for customers to closely define their geographic marketing area, drawing demographic data from the company’s proprietary mailing list of 126 million resident addresses.
To better understand a target audience, one must first define the targeted retail trading area. Retail trading areas are those from where your customers and sales come. Advo has the capabilities to help define, analyze and target retail trading areas as well as map accordingly. The perimeter (see Figure 1) designates a client’s retail trading area defined by how far out that particular location’s customer base extends or where 90 percent of their customers originate.
Residential customers always live nearby. In general, the closer a household is to a retailer, the more likely they are to buy there. We call this proximity. The trading area for a retailer can be divided into four sections:
- Primary trading area. Best sales producing ZIPs/ATZ’s/CRs that together equal 65 percent of the clients’ sales
- Secondary trading area. Second-best sales producing geo-units that together add 15 percent of the clients’ sales
- Tertiary trading area. Along with transient trading area is the next best at producing geo-units that together add 10 percent of the clients’ sales
- Transient trading area (see above).
Advo takes the process one step further. It can help target by overlaying client, demographic, and psychographic information at the ZIP and sub-ZIP code level to accurately define trading area propensity to purchase, which it calls “potential.”
In the money
Founded in 1979, Money Mailer (www.moneymailer.com) packages individual free-standing ads in an oversized red, white and blue envelope filled with money-saving coupons. Money Mailer serves over 100 categories of local businesses nationwide, mailing over 110 million envelopes and servicing over 30,000 advertisers each year, according to the company. Like Advo, Money Mailer also offers additional products and services including a mapping service. Last year, it launched the largest “new mover” program, Home At Last.
With new restrictions and bans on other lead generation media, water treatment dealers might take a long look back at direct mail including “share mail” programs such as Advo and Money Mailer. At the very least, sending out your own personalized postcard promotions to customers and prospective ones may be back in vogue.
About the author
David H. Martin is president of Lenzi Martin Marketing, of Oak Park, Ill., a firm specializing in water improvement and environmental marketing that integrates old and new media. He can be reached at (708) 848-8404, email: email@example.com or website: www.lenzimartin.com