Grumpy DM

Sheep

2005-10-07T11:12:00.000+00:00

THE BEST DAY TO MAIL

Don’t act like a sheep yourself but do make sure your customers act like them.

I came across some research recently that proved to me once again that most marketing people rarely think for themselves, but follow one another like sheep. Morgan Stewart, a guy at ExactTarget (http://email.exacttarget.com), clearly knows what he talks about on the subject of Email messaging and states that the day or time at which you send an Email message can have a real impact on response rates.

It’s the same with direct mail, except you can never be exactly sure how long your message will take to reach your prospect, whereas with Email you simply click your mouse and the message disappears into the ether for instantaneous delivery.

Apparently, about a year ago, conventional wisdom was that the best day to send an Email was Tuesday. Then someone did some research that showed that deliverability rates were best for mail sent on a Monday. Clearly this research was highly read and acted upon. Then ExactTarget conducted its own research on the topic, analysing twelve months of historical data, 2,000 organizations, 160,000 email campaigns and 800 million Email messages, making it the largest amount of data ever analysed in a study on this topic. This showed that the best day for sending an Email had shifted to Wednesday, Thursday or Friday; indicating to me that all the sheep were now mailing on a Monday, cluttering up peoples inboxes and not having their messages read.

In case you’re interested in this, apparently Sunday and Saturday yield the highest click through rates, since with less competition in the inbox during weekends, people who open your email have more time to read and respond to your message.

Results by industry vary. High tech companies fare well on Fridays, membership organizations on Wednesdays and online retailers drive twice the click¬through rates when sending on Sunday.

Don't be a sheep - TEST, TEST, TEST!!!

Please do not follow these results blindly like sheep. One of the greatest things about the internet is the ability to test ideas and get results back almost instantly, so that you can analyse your data and repeat your successes on a larger scale. With direct mail testing months can go by between setting up a test matrix and getting sufficient replies and orders through to find out what works best.

But there’s more to it than that. In the world of CRM, you should know which day of the week and hour of the day EACH customer is most likely to respond to your message. If you do you’ll be sending mail constantly through the week which actually makes the whole process of dealing with replies and orders somewhat easier since they all don’t arrive simultaneously.

Of course, if you don’t have precise data on every customer, do some analytics and clone the data to match the customer. And if you don’t recognise the sheep in the accompanying photo, it’s Dolly the clone!

Let’s have a Music Preference Service

2005-03-18T08:36:00.000+00:00

About the only part of the direct marketing industry I’ve not worked in is the telemarketing business. However, I believe I’m qualified to comment on it, as I have been involved in choosing call centres for various businesses over the years. Besides, I must be recognised as an expert, since whenever I phone one I’m usually told that my call may be used for training purposes.

However, you’ll not be surprised that I have a few gripes with them. The first, is their poor use of predictive diallers. This should be a piece of technology they could use for greater efficiency rather than for the bafflement of their customers. I’ve lost count of the times my phone has rung and I’ve listened to a ringing tone while an operator is found to speak to me. My annoyance now outweighs my inquisitiveness over the nature of the call and I hang up before they have the chance to speak to me. Damn their dialler.

Save me from Muzak

But if you’re as grumpy as me, it’s the music you are forced to listen to while on hold you’ll find most annoying. Like pubs and bars, the music and volume seems to be chosen by the staff for their enjoyment, rather than for the entertainment of customers. Now, in a bar I can ask them to turn it down or change it, but I have no choice while I’m on hold at a call centre. And that’s why I’m advocating the establishment of the Music Preference Service.

Since most organisations I deal with ask me questions that in a million years I can’t imagine them ever using for my benefit, it seems to me that if they asked about my music preferences they might be able to start treating me appropriately. Then instead of some worn out musak from the 60’s or 70’s or the latest hip hop, I’d be treated to the soothing tones of Miles Davis or something lively from Senegal.

They could even give me a choice. “Please press one if you would like to listen to Kind of Blue; two for Orchestra Baobab; three for Charles Mingus; four for Sly & Robbie.” (I do have an eclectic taste in music.)

It would be even better if they called me back rather than have me wait on them.

A lesson from More Than
More Than, the insurance company, did this for me recently when I was feeling particularly grumpy about a policy renewal they sent me. I called them to cancel the policy and found that by pressing “three” I could be put through to someone who dealt with cancellations. I pressed, as instructed, and was told that as there was a queue I would be called back within the hour if I left my name. (They had the technology to save my number.)

Good to their word, I was called back quickly by a charming lady specially trained to deal with grumpy gits like me. I told her why I was leaving them whereupon she offered me fifty quid to stay. So I did. A great service, a great saving and not a note of Dire Straits or strangled Mozart to irritate me.

Other call centres take note because there are a couple of valuable lessons here. Firstly, like More Than, make sure you have an effective winback programme that recognises that it’s usually more cost-effective to retain a client than recruit a new one. It sounds so easy…but very few people bother to work it through and do it properly. Secondly, don’t annoy your customers with musical bilge.

However, if you have to have music, make sure you subscribe to the Music Preference Service as soon as you can.

Bring Back The Postmaster General

2005-03-11T10:13:00.000+00:00

It seems to me that direct mail was better years ago when we worked under a more authoritarian regime. In those days we knew where we stood and what we could and couldn’t get away with. The Post Office Guide was a minefield of rules and regulations; for example, getting any words on the outside of an envelope, other than the address, was subject to approval in triplicate from a hierarchy of Royal Mail jobsworths.

But response rates soared and my doormat was rarely a landing pad for dross as it is today. Instead, we have a more laissez faire attitude to direct mail and almost anything unfortunately goes. The man running the Royal Mail typifies this. The last time I saw him, he was presenting a first prize at the DMA Awards and couldn’t even be bothered to wear a black tie with his DJ.

I believe we could junk the junk mail sobriquet once and for all if we make a return to the good old days. All we need is for all direct mail to be approved by a committee made up of some of my old chums and colleagues under the iron fist of a 21st century Postmaster General.

These experts would scrutinise all direct mail and grant permission for items meeting their exacting standards to be mailed. The rest would be subject to an overprinting with a Postmaster General warning, in much the same way as fag packets are plastered with Government Health warnings today. These would caution consumers against the ghastly offers inside.

I have prepared a few overprints in advance for some notable culprits.

For credit card offers:

WARNING Don’t be taken in by this tosh. Get a life - pay cash. APR is an interest rate, not an abbreviation for April you big pillock.

For cars:

WARNING Look, the moment you drive this off the forecourt you can wave goodbye to 10-20% of what you paid. What’s more, you’ll be visiting the dealer for ages getting the rattles sorted. Do yourself a favour, buy yourself a six-month old model, trouser the difference and take the missus on holiday. (Or, send the missus on holiday and get yourself an 18-year old model).

For time-share:

If you believe this, you probably think that EastEnders is about real people and the Daily Mail is a newspaper and not the samizdat of the Conservative party. You have been WARNED

Collectibles:

WARNING This edition is not limited by our avarice…only your gullibility. About as much chance of increasing in value as you have of being called Dobbin and winning the Grand National. If you want to collect something try train numbers and meet people of your own stupid IQ.

I hope this gives you some idea about how effective the scheme would be.

There are further benefits. Good agencies would grow because only those with the best creative teams would get their work through the committee unscathed. Most clients would have to stop rewriting anything presented to them and get on with their job of commissioning, commenting upon, approving and organising mailings.

Standards and response rates would increase. There would be no need for the Mailing Preference Service because everybody would enjoy receiving mailings.

Please leave your own suggestions for Postmaster General warnings in the “Comments” section below. Be as grumpy as you like!

That Little Orange Button

2005-03-09T09:59:00.000+00:00

To the right of these words you will see a little orange button marked XML. This is a link to an RSS feed. RSS (Really Simple Syndication) is a format for syndicating news. It allows you to receive automatic updates about my blog and any other news you would like to be kept up-to-date with, without having to regularly revisit a web site. The BBC provides an RSS service, as do many other news organisations.

To view an RSS feeds on your computer, you will first need to acquire an RSS Reader – they’re usually free. Click on the XML button and find out all about them.

Then to add my blog to your newsfeed, copy and paste

http://feeds.feedburner.com/GrumpyDm.com

into your RSS application. It's that simple and when I update my blog you’ll know right away.

Help! There’s An Election Coming

2005-03-05T12:12:00.000+00:00

Unless you happen to be a hermit alone on some solitary peak (a jolly good place to be right now), you must have noticed that we are quite likely to have an Election on 5th May.

Years ago, direct marketing folk lived in fear of Elections. In the run up to them, direct mailings fell to a trickle and off-the-page ads disappeared. This was simply because public interest in campaigns was so great that there was little time to spare to look at the latest offerings dropping through the family letterbox. What’s more, the news in the papers was more interesting than the ads, so nobody clipped the coupons. People were simply distracted by an important national event.

I think times have changed. Surely I can’t be alone in wanting the whole wretched, spin-loaded, ballyhoo to be finished and that by some miracle we can be transported to the 4th June when all is done and dusted, the flat season is with us and the Derby is run.

Personally, I have taken steps to avoid any political news. I have super-glued most keys on the TV remote so that I cannot inadvertently tune to any news broadcast. When I watch TV it will be a diet of UK Gold and the Shopping Channel. All radios have been disconnected and the newspapers cancelled. I have asked the publishers of The Spectator to tear their illustrious journal in half and send me only the review section and the humorous back of their magazine. I have made special arrangements with my postman to collect this from the pub, since my letterbox has been nailed up with a sturdy piece of timber so that election manifesto’s cannot be delivered. A machine gun nest is being erected on the roof to deter political canvassers and take care of any brave enough to walk up the drive.

In the meantime, the direct marketing community can get on with its work without worry. Not every consumer will be taking the extreme precautions that I am. I expect most people will simply avert their eyes, stick their fingers in their ears or up at the politicians and ignore as much as they can. Moreover, as a distraction from the unseemly farrago, they may take more than their usual notice in the direct mail they receive and continue to reply to ads they like for things that they want.

Further, I predict that the turnout to the forthcoming election will drop to an all time low and that public apathy for the event will be reflected in little deviation from standard response rates. So if you are planning any activity for the end of April or early May, don’t postpone or cancel it.

A Few Words On Churn

2005-02-26T13:24:00.000+00:00

In my article about the city not understanding Sky, I mentioned how good the Sky churn rate was. An old client of mine wrote and said that most investors probably think that churn is something you buy milk in. Made me laugh, but it did remind me how much obfuscating jargon we use. Churn is simply the number of customers you lose in a year and is expressed as a percentage of your total customers.

Every business will suffer churn to some degree and the aim should be to keep it as low as possible. You’ll lose some customers through natural wastage (jargon for death) and others because they no longer have a need for the product or service. It’s tough selling nappies to mothers of young children after a certain age. So this must be subtracted from your churn rate.

Everything else you can manage and is all about how you go about recruiting and looking after customers.

A credit card company once asked me to get new customers to use their card. This activation process was as difficult as pushing water up hill, because the customers had been heavily incentivised (jargon for bribed), to sign up for the card. After testing various mailings, we found that the only way to get them to use their new piece of plastic was to offer a further bribe. So a cheap method of recruitment became very expensive.

This stupidity continued for quite some time, long after I resigned the business in frustration, because the company was more interested in telling its investors how many new customers it had. The important data was, of course, the number of active new customers.

This illustrates how important the recruitment process is, how much thought is needed to make it work effectively and how closely you should measure the results. But a further point needs to be made.

If you really want to drive your company forward you won’t achieve it by undertaking the most cost effective recruitment policy. You’ll need to take a few risks to build recruitment numbers and then work hard to turn them into customers. This can be achieved by delivering a customer experience that is second-to-none. A subject I will return to another day.

Rub Your Hands – It’s A Royal Wedding

2005-02-17T11:24:00.000+00:00

Prince Charles getting down on one knee will have a rejuvenating effect on parts of the dm industry. Indeed, many dm people will have received the news as if they had found themselves at the end of a rainbow, won the lottery and received an all clear from the clinic all in one go. One of my oldest friends, Danny Phillips, was first off the mark when he showed me the artwork for his client The Westminster Collection. This was for a first day cover complete with Royal Mail Stamp, Wedding Day Postmark and Official Engagement Portrait for a princely (sorry) £3.50 plus p & p. Of course, each envelope will be individually numbered within its 29,500 worldwide edition limit.

Now, you may look down your nose at this activity or think that it is beneath you to find a Royal Wedding link for your own organisation. On both counts you would be wrong and I can only encourage you to get your nose in the royal trough as soon as you can, after all, time is limited! Let me tell you why. The Westminster Collection will almost certainly flog all their 29,500 limited edition envelopes and if they make any money doing so I will be agreeably surprised. But what they will have done is acquire 29,500 punters, or in marketing speak, recruited new prospects, and this can be a very difficult to achieve at a low cost per prospect. But Westminster will do this and then have a field day. For the next few years these prospects will receive many more offers to complete their wedding collection. I shouldn’t be at all surprised to see commemorative covers becoming available from every Commonwealth country and most small islands around the world. It could take years for a customer to complete their collection and every time they add to it the cash registers will be ringing in Watford (look Westminster is just a name). On a dm course they’ll call it ROI and retention activity, but I think you’d be quite justified to call it milking the punters.

Now of course, I’m not expecting you to do exactly same activity as outlined above. All I’m encouraging you to do is not to over estimate the great British public and appeal to the monarchists out there who love the Royal Family. Put your thinking caps on, brainstorm, get some ideas, rejuvenate your own dm and take advantage of the media fixation that we will all suffer or enjoy between now and 8th April and probably beyond.

I’ve just noticed that Asda will soon be selling a replica of the Royal Engagement Ring for £19. Good on you lads, fill your boots!

The real ring on Camilla Parker Bowles's finger, and the £19 fake from Asda

SKY Broadcasting – don’t the city understand?

2005-02-16T12:51:00.000+00:00

You know, the direct marketing business is very simple and you don’t have to be that talented to be reasonably successful at it. Which is why I’m so surprised that most city investment analysts seem not to understand it at all. But perhaps I shouldn’t be surprised and they are just thick. Look at this. A few days ago Sky Broadcasting announced their latest figures, their subscriber numbers had increased by a net 192,000 for the quarter. The analysts looked at this and the share price went up. Then they got beyond the headline numbers and looked at how much money was being spent on recruiting new subscribers, an increase of £43 million driven by “higher acquisition and retention costs, reflecting increased direct marketing and installation offers across all product categories,” and the share price went down. Did the analysts think Sky could get new subs for free?

Now if an analyst had spent a week with a direct marketing agency or, better still, a good old-fashioned mail order company or a mobile phone operator, they might have understood the Sky figures better. Mind you, perhaps the thicker ones might have needed to spend a little longer understanding the dynamics. All they need to understand is recruitment numbers and costs, churn and annual average revenue per customer. Sky tell us that their churn was just 9.5% (amazingly low) and annual average revenue per customer £386. That was £17 up on twelve months ago and you don’t have to be a genius to work out that if you’ve got 7.6 million customers and you can squeeze an extra 17 quid out of each of them, then you’re doing quite well!

What the analysts would also have understood after a week with a mail order company, is that eventually, all the low-cost customer recruitment methods get worn out and that you can’t rely on Member Get Member promotions and discount offers to get new customers. So if you’ve already got 7.6 million customers that’s going to be tough. They would also understand that eventually you need to start recruiting a different type of customer because you’ve saturated your existing market place. This costs money and it seems to me that Sky have been spending £43 million very wisely to achieve this. What they have also done very well is gently reposition their brand with their new target audience so that they don’t just come across as a sport and movie provider.

If there is any good to come out of this, I suppose it is that a direct marketing expert and even quite a few of the inperts, could make a few bob out of investing in Sky. What’s more, if I were running the Institute of Direct Marketing, I would seriously think about running a dm basics course for city analysts so that they could understand the business.

What's this all about?

2005-02-02T22:47:00.000+00:00

Why do so many organisations spend a fortune every year mailing rubbish? You would have thought that in a maturing business the quality of communications would have improved. Thirty years ago there were only one or two direct marketing agencies in the UK...now we have dozens. The Institute of Direct Marketing train dozens of people every year. But despite this expertise being available, my letterbox still gets stuffed with what can truly be called junk.

No doubt, you receive your fair share of it too. This blog aims to expose the culprits and suggest ways of improving their approach and copy. I'll be using the contents of my letterbox as examples, but if you receive an item that you would like to expose, simply send it to me with your comments or critique and I'll expose the villians.