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One of Our Long-Time Columnists Addresses the Most Frequent Direct Marketing Questions.
PART TWO
Hi there...Jeff Dobkin again. Let's continue our look at some of the best (and most frequently asked) questions on marketing.
Q. WHAT DOES IT COST TO MAIL 1,000 TO 5,000 PIECES OF MAIL?
A. Figure the costs between 40 and 50 cents per piece mailed. This includes letter, brochure, list, envelope, and postage.
Q. HOW CAN I FIGURE OUT IF MY CAMPAIGN IS GOING TO BE SUCCESSFUL?
A. Work all the numbers backward. Here's how: Suppose you are going to mail 1,000 pieces. Using the above figure of 50 cents each piece, this mailing will cost $500. What percentage response do you need to make money? How many recipients need to buy your product for you to make your $500 back? For example, if your product sells for $50, and you make $10 net on each sale, you need to sell 50 units to make back the cost of the mailing--$500. So you'll need a 5 percent response rate of buyers (not just inquirers) to break even. That's a lot. Even a five-percent inquiry rate is a lot.
This is why items that sell for $10 don't work in solo direct mailings. If it sells for $10 and you make $4 each sale (or even $5 per sale, which is a lot), you'd still need a 10 percent response rate--or 100 orders--to make your $500 back on a 1,000-piece mailing. In traditional mailings, you may get 100 inquiries if it's an exceptionally good piece, but only a small portion of them will convert to actual buyers.
When figuring your chances of success, figure out the exact percentage response you'll need to become profitable. Then ask yourself if that's attainable.
Q. SO THEN, WHAT IS A GOOD RESPONSE TO A MAILING?
A. Anything that makes money. But figure 1/2 to 1 percent as OK. Anything over that is pretty good. Here's the real question: will you be profitable if one person out of 200 buys (1/2 percent)? If one out of 100 buys (1 percent)? If you're selling airplanes, perhaps a .0001 percent response is pretty good if the respondent buys just one, single 747.
Q. WHAT IS THE OBJECTIVE OF THE MARKETING FUNCTION IN DIRECT MAIL?
A. First, to narrow the prospect list to "the people who are the most likely to purchase, and make that purchase as soon as possible." If this mailing doesn't work, you need to reconfigure something.
Next, to create an irresistible offer that makes people want to "buy now" and possibly, "buy more than one." Finally, make sure customers are satisfied after receiving your goods or services, so they will continue to be your most likely prospects to purchase again, and will refer you to their friends.
Q. I'M THINKING ABOUT ENTERING AN INDUSTRY. WHERE DO I GET MORE INFORMATION ABOUT IT?
A. Most industries are served by their own group of specialty magazines where you can learn about the industry. Additionally, many industries have associations that are staffed by trained and knowledgeable professionals. Get the magazines, then call the association headquarters and ask for industry information.
Q. HOW DO YOU FIND ALL THE MAGAZINES THAT SERVE AN INDUSTRY?
A. Use the magazine directories at the library: Find any industry and the magazines that serve it in under five minutes. The best ones are Bacon's Magazine Directory, Burrelle's Magazine Directory, and Oxbridge Communication's Directory of Periodicals. Check at the reference desk.
NEXT ISSUE: Jeff answers more marketing questions.
Jeffrey Dobkin, author of HOW TO MARKET A PRODUCT FOR UNDER $500 and UNCOMMON MARKETING TECHNIQUES, is a specialist in direct response copywriting. He writes powerful, response-driven sales letters, TV commercials and scripts; persuasive catalog copy; and exceptionally hard-hitting direct mail packages that increase sales. He also analyzes direct marketing packages, ads, catalogs, and campaigns. Mr. Dobkin is an acclaimed speaker and a direct marketing consultant. Call him directly at 610-642-1000 for free samples of his work.
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