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PRESIDENT'S CORNER
Succeeding in Tough Times
By John Lenser, President
Years with Olympics and presidential elections have historically been down years for catalog companies, but no one could have forecast a mortgage crisis and a recession, which have resulted in record low consumer confidence and tumbling sales. While these conditions in themselves would alarm catalog management, the recent failure of several venerable catalog companies has shaken the entire industry. So, what is the advice that LENSER is giving our clients? Read on for details…
FEATURE ARTICLE
Gaining Insights into Customer Behavior
By Al Bessin, Partner
The pressures on merchants are intensifying: catalog marketing costs continue to escalate, consumers are being bombarded with marketing messages, margins are being pressed down due to higher costs, consumers have more information sources than ever to research purchases, more buyers use more channels to shop, and everyone seems to have a shorter and shorter attention span. The game is changing. How to change with it?
CASE STUDY
The Importance of Accurately Tracking the Source of Demand in the Age of Converging Channels
By Travis Seaton, Vice President
In this day and age, it’s almost certain that your company is experiencing an increase in orders taken online and a decrease in the volume of orders taken via your call center. Conventional wisdom would tell most any executive to reduce the amount of marketing budget currently devoted to the offline channel and allocate more into the online marketing world. If you are a part of the majority, you are employing matchback technology to identify the source of demand, which may or may not support a shift of marketing dollars from one channel to another. Is this the proper method to use in determining your marketing budget? Find out...
CIRCULATION TIP
Records Without Email Addresses—How Well Do Yours Perform?
By Jim Whitford, Marketing Manager
Almost every multi-channel business has seen a reduction in the number of orders flowing through the call center and, conversely, an increase in the amount of orders coming in via the web. The focus of email campaigns and other internet marketing is quickly shifting in emphasis towards customer retention. For many firms, convincing an existing customer to buy again may only require a single email. Not all customers, though, respond to or reactivate from email campaigns. And what should you do with customers for whom you do not have an email address? Read on to find out.
CREATIVE TIP
Better By The Bundle
By Carol Worthington-Levy, Creative Partner
We don’t always work as hard as we should to get those larger orders. That’s why whenever possible, I recommend creative bundling of products and services to both improve a bottom line, and increase customer satisfaction. While one would think it is ALWAYS good to sell product, there is a point where too small an order actually hurts more than helps. This is one of the first places that selling by the bundle pays off. What would make a good bundle? Try this!
MULTICHANNEL TIP
House File Segmentation: Channeling Best Practices
By Todd Miller, Director
For several years now, LENSER has been recommending that for the purposes of direct mail campaigns, multichannel retailers segment their house file by the channels that customers have used. This month’s multichannel tip summarizes LENSER Best Practices concerning this topic. Read more
CLIENT HIGHLIGHT—MOSS MOTORS INC.
How many of us can point to a single purchase that would completely change the direction of our lives? Sixty years ago, Al Moss had such an experience when he purchased an MG TC automobile. Al became an avid MG TC enthusiast and after learning about road rallies in other parts of the country, he began to organize some of the first rallies on the West Coast. Fellow MG enthusiasts that Al met through the rallies shared not only his passion for classic automobiles, but also a common problem; difficulty finding service and parts for them. Al saw an opportunity... Read the full story.
EMPLOYEE SPOTLIGHT—JERRELL LEWIS
When Jerrell earned her B.S. in Marketing from San Diego State University, she did not imagine a career in multichannel direct marketing. "After college, I went to work in the advertising sales department of a trade magazine. I liked it, but after about three years, I was ready to move on. After working in advertising, it was really interesting to work in an environment where sales could be measured." Read about Jerrell
AFFILIATE FOCUS—DHL SMART & GLOBAL MAIL
How quickly are you fulfilling those hot catalog requests that have been coming in on the phone or through the web? "It’s a well-documented fact that when less time elapses between the request and the receipt of a catalog, the response rate and average order value will be higher," says John Lenser, president of LENSER. "Thus, it is an advantage for you to reach your customers as quickly as possible. That's why we reached out to form a strategic partnership with DHL Smart & Global Mail for our clients."... Find out how DHL can help
NEWS BRIEF
- Are you ready for the 2008 Annual Conference for Catalog & Multichannel Merchants (ACCM) taking place May 19-22, 2008 at the Gaylord Palms Resort in Orlando, FL? For those of you who have not attended the ACCM, LENSER strongly urges you to come. The ACCM will focus on the strategies you need to successfully integrate your catalog, web, store, phone, sales force, distributor, email and other marketing channels. The conference is the event of the year for catalogers, providing three packed days of educational seminars and many opportunities for networking. LENSER staff will present several sessions covering catalog circulation, channel integration, and creative issues. Register Today and Save up to $100 on your full conference registration! Go to www.accmshow.com and use the LENSER savings code LEN for your discount when registering. Let us know if you plan on joining us—we look forward to seeing you in Orlando!
- If you would like to schedule an appointment at the ACCM in Orlando, FL, May 19-22, 2008 to discuss your specific needs, please give John a call at 415-446-2501 or send an email to
. We know that we can make a very positive contribution to your company’s growth and bottom line profits. We're pleased to discuss your challenges and help you discover all the ways your business can become more profitable even in tough times.
- Congratulations to our own Travis Seaton on his promotion to Vice President, Multichannel Marketing Consultant here at LENSER. Travis joined LENSER in 2001. To read more about Travis, click here.
- To ensure delivery of your monthly eNews from LENSER, please remember to add newsletter@lenser.com to your address book. To sign up for the LENSER eNews, please contact
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PRESIDENT'S CORNER
Succeeding in Tough Times
By John Lenser, President
Years with Olympics and presidential elections have historically been down years for catalog companies, but no one could have forecast a mortgage crisis and a recession, which have resulted in record low consumer confidence and tumbling sales. While these conditions in themselves would alarm catalog management, the recent failure of several venerable catalog companies has shaken the entire industry. So, what is the advice that LENSER is giving our clients?
Develop a Strategy and Tactical Plan
Don’t simply react to falling sales after the fact by cutting marketing expense. Lower marketing expenditures will, of course, result in lower sales and gross profit. If not followed by commensurate reductions in operations and overhead, the bottom line will take the full hit. Our recommendation: develop a plan that provides clear priorities for reductions in not only marketing, but expenses across the company. Know exactly what you will do at each crossroad that you encounter.
Reduce Circulation and E-commerce Expenditures
In any circulation plan or keyword buy programs, there are less productive segments and words that can be eliminated. However, they must be eliminated not with a hatchet, but with surgical precision. Over the years, LENSER has developed many advanced techniques to identify both buyers and prospects that return the highest and lowest ROI. Be sure to eliminate only those names and keyword terms that will not contribute to profit.
Institute “Best Practices”
Inefficiency and poor techniques are frequently covered up in good times. But when times are tough, it is those companies that have solid management practices, sophisticated circulation techniques, effective creative and websites, and efficient operations that will be the least affected by a downturn. It is imperative that you adopt “best practices,” and not allow profits to fall through the cracks.
Call on LENSER for Support
LENSER is prepared to assist you in meeting these challenges. LENSER’s seven partners have consulted with hundreds of companies to develop strategy, plans, and conduct “best practice” reviews. Such reviews can address catalog marketing, e-commerce, creative or any aspect of your operations. Virtually always, such efforts provide immediate savings and long-term profits.
LENSER can also work with your marketing staff to develop appropriate plans that maximize advertising cost reductions while minimizing sales reductions. If appropriate, we can step in to perform the day-to-day circulation management tasks—over 70 companies retain us in this capacity as a highly cost-effective approach for gaining cutting edge expertise.
Request a Free QuickCritique™
LENSER's QuickCritique™ gives you a preview of our comprehensive services—call Michele Salmon at 415-446-2511 today to set up an appointment with one of our partners! We would be pleased to discuss your challenges and how we can help you succeed in these difficult times and be well-positioned to prosper when the economy inevitably turns around.
FEATURE ARTICLE
Gaining Insight into Customer Behavior
By Al Bessin, Partner
The pressures on merchants are intensifying: catalog marketing costs continue to escalate, consumers are being bombarded with marketing messages, margins are being pressed down due to higher costs, consumers have more information sources than ever to research purchases, more buyers use more channels to shop, and everyone seems to have a shorter and shorter attention span. The game is changing.
Mass marketing, where one message is sent to all, is diminishing in effectiveness—a combination of higher cost and a noisy marketplace contribute to the effect. The best marketers are finding ways to tailor their messages and increase relevance in ways that range from using different catalog covers for different segments to developing email and postal mail campaigns that specifically target small, highly specific niches of buyers.
There are two challenges to be met. Understanding the behavior of your buyers is very important. Analyzing their purchase histories a number of ways, and ferreting out the trends therein can accomplish this. However, there are many variables to consider: classic RFM (Recency, Frequency and Monetary metrics), channel of purchase, channel of acquisition, product categories, product brands, geography, seasonality, and response to previous offers, to name a few. So the possible combinations are huge. And, behavior is changing due to channel shift, consumer preferences, economic conditions, generational preferences, and the crowded marketplace.
A merchant has to go beyond traditional, static reporting tools in order to leverage the wealth of information collected in their information systems. Past buyer behavior is predictive, and has been effectively used by merchants to develop catalog and email campaigns. But, market and competitive pressures demand that merchants find new opportunities with higher ROI.
There is so much opportunity in the details – the challenge is how to effectively get to that opportunity.
Information Support
The demands for information to support marketing are increasing at a fast pace. While most merchants do a good job of capturing information, many do a poor job of maintaining it with appropriate data hygiene in a format that is readily accessible to marketing decision makers.
Data Hygiene. It is incredibly important that the wealth of customer and purchase data a merchant accumulates is maintained appropriately. While lists can be merged and address correction can be applied at a service bureau prior to mailing, any analyses that are performed in-house will be highly inaccurate unless the customer files are de-duped and addresses are correct. You can accomplish this a number of ways, perhaps the simplest being to upload changes from the merge and address correction processes back to your housefile.
Internal Reporting. While most order management systems have a number of standard operational and marketing reports, not many are useful tools for divining the types of trends necessary to optimally target your marketing. Some of the systems have query tools that can be used for that purpose, but they are often complex to learn and, most importantly, require an accurate knowledge of the database layout.
If you are dependent on a query tool to drill into your data, you need to be sure that you have an expert available that thoroughly understands how to use the tools effectively and knows the data architecture. The disadvantage to this approach is that it stifles the creativity and development of intuition for you or your marketing process owners.
Reporting Database. In addition, if queries are performed on the same database that is used for order production, there is a risk that queries will bring system performance to a crawl. It is far better to aggregate the data to be queried in another database. That protects the production database from being bogged down.
A great benefit of having a separate reporting database is that it can be structured so that it is most efficient for reporting. Some of the commercial order management systems available include basic reporting databases, and some have ones that are more sophisticated. Developing a reporting database is something best left to an expert, as there are many techniques that need to be used in order to keep the data in sync with your production database and efficiently accessible for queries and reporting.
For many merchants, a very effective solution is to outsource the reporting database. I recently participated in a Webinar where we demonstrated just such a system, provided by OCO, Inc.
Some High ROI Opportunities
Here are a few examples of ways in which these data can be used to boost sales and ROI.
Product Brand or Category Loyalty of Buyers. It is extremely valuable to understand the pattern of purchases that buyers make with respect to product brands or product categories. Most product assortments span multiple categories and, in the case of merchants that re-sell national brands or that have developed strong house brands, can span multiple product brands. Being able to drill into purchases by category can help you understand how different groups of your customers behave.
At a macro level, it may be possible to segment your buyers into major categories based on their aggregate purchases. For example, a bicycling products merchant could better target marketing by separating mountain biking from road biking buyers and delivering different messaging in email campaigns or, perhaps, with different catalog covers in the mail.
At a micro-marketing level, identifying product brand loyalty trends would suggest many opportunities for highly targeted and consumer-relevant email campaigns. Consider a golfer that has purchased clubs, accessories or apparel with the same brand two or more times. He or she would be a good candidate for an email announcing new product introductions under the same brand.
Behavior of Buyers by Season of Acquisition. Seasonal businesses acquire buyers year-round, but not at the same rates. Do the buyers acquired out of season behave the same way as those acquired in season? We have found that they do not. For example, in a gift business, the greatest number of buyers are acquired around the Christmas Holiday season. However, gift merchants often find that, while fewer in number, buyers acquired out of season are often the most loyal.
A gift merchant, for example, might find that, while 65% of new buyers are acquired during the Christmas shopping season, there are clusters of buyers acquired around Valentine’s Day and Mother’s Day. That “micro-seasonal” behavior could make it profitable to expend a lot more effort and resources with these buyers in these seasons, where it would not for the whole housefile.
Knowing how buyers acquired by various means behave after their initial purchase will help a merchant to allocate marketing resources most effectively over time.
Regional or Climate Zone Purchase Behavior. Obviously, horticultural product merchants must time their marketing carefully to the growing season. The better merchants pay close attention to how spring arrives across various regions in the country, and time their marketing efforts to various regions differently to trigger demand when interest is peaking. Clearly, sporting goods are seasonal. Other industries may be seasonal in less obvious ways. For example, indoor hobbies such as woodworking may behave in manner that is countercyclical to great outdoor weather.
However, not all climate-driven seasonality is obvious. For example, there are segments of the golf-buying population living in cold climates that make significant purchases long before the local golf season begins. These are the snowbirds that migrate to or vacation in warmer locations.
Even in the case of a horticultural products merchant, climate seasonality can be complex. A merchant may choose to use general climate zones to stagger spring mailings. However, there are numerous microclimates within some large zones that have different seasons. Being able to drill into a marketing database and use past purchase seasonality by zip code or other small microclimate regions could yield many pockets of additional opportunity that would be missed when using more generalized climate tables.
Understanding buyer behavior in different climate zones and finding those micro-segments of prime targets will help a merchant develop campaigns that target peak demand periods and generate high ROI.
Purchase Behavior of Buyers by Channel of Acquisition. As we have noted in many studies we have done, buyers acquired via different marketing channels often exhibit profoundly different behavior. An extreme example would be Holiday gift buyers that are acquired by a paid search term for a national brand (not a house brand).
Call to Action
The bottom line is this: you and your marketing process owners need to be able to mine the data that you have in a quick, effective manner in order to identify all of the pockets of opportunity you have already paid for in your customer file. The intensity of competition, changing consumer behavior, and financial challenges in the marketplace make this an imperative.
CASE STUDY
The Importance of Accurately Tracking the Source of Demand in the Age of Converging Channels
By Travis Seaton, Vice President
In this day and age, it’s almost certain that your company is experiencing an increase in orders taken online and a decrease in the volume of orders received via your call center. Conventional wisdom would tell most any executive to reduce the amount of marketing budget currently devoted to the offline channel and allocate more into the online marketing world. If you are a part of the majority, you are employing matchback technology to identify the source of demand, which may or may not support a shift of marketing dollars from one channel to another.
Is this the proper method to use in determining your marketing budget? The devil is in the details of the business rules created during the matchback, along with the proper use of other data available during the process.
Company X not only has the intricacies of accurately identifying the demand source for internet and call center orders, but also has to account for orders from a large chain of retail stores. As shown in the chart below, each marketing channel is both creating demand for others and at the same time, receiving demand in kind. This exchange, however, is typically not one-to-one. As marketers, we need to understand this exchange as accurately as possible in order to intelligently determine how best to spend our marketing budget.
One of the major issues in determining source of demand from the retail store channel, is the lack of name and address (as needed for matchback) captured at the point of sale. Fortunately, Company X has a tremendous capture rate at retail, due to a robust loyalty program which creates incentive for the customer to identify themselves during the transaction. If you are not so fortunate as to have accurate point of sale data, there are reports available which will supply industry averages to use as benchmarks for your own company.
Company X used many marketing techniques to drive demand, each tailored specifically for the channel in which they thought the consumer would buy. These included direct mail pieces for retail, catalogs for the call center, and SEM/SEO and emails for the website. In order to identify the universe of customers (or potential customers) to market, they used their past preferred channel of order as a selection criterion. So for example, if customers had only bought from retail, they would only receive retail promotions. Matchbacks were run for each channel/vehicle and marketing budgets were created to optimize ROI based upon the perceived results they had created. Yet sales continued to decline.
As indicated in the opening, the devil is in details. In this case, it was not only in the business rules created for the matchback processing, but also the universe selection and the techniques employed in creating the backend reports from which budgeting decisions were being made. The cross-channel behavior was not being accounted for, and more importantly, the natural rate of shopping was not being considered.
The retail channel's primary marketing vehicles were direct mail pieces ranging from postcards to full-fledged 40-page catalog circulars. In order to be eligible to receive one of these pieces, one had to be an active retail customer. This limited the universe to which they could market and did not account for cross-channel behavior, as illustrated in the chart above. Proper matchback techniques were being applied on the marketing campaigns, but one crucial piece of data was being left out of the analysis: the high natural rate of shopping that retail traditionally experiences. Company X had created hold-out groups within their retail marketing campaigns in order to measure the incremental demand being driven, but had neglected to apply the same methodology when creating the results on the backend. When the incremental demand data was applied, the performance of the retail drivers dramatically changed, as can be seen below.
This chart also reflects the difference in performance of the catalog when the proper demand allocation is applied. Similar to the issue with reporting on true retail demand, Company X was not attributing demand being captured at retail back to the catalog. When the matched retail demand and incremental lift (from the hold out groups) were applied, the catalog performance increased dramatically.
Another client, Company Y, was experiencing a similar problem with their reporting of online demand. Though a matchback was being run to identify online orders driven by catalog efforts, this demand was not being accounted for when evaluating online sales. Therefore, the backend performance for online was inflated. This was a revelation to top management.
The chart below provides a clear visualization of how internet sales react to direct marketing efforts. When weekly sales by online source are displayed with respect to the in-home of the company’s direct efforts, it becomes abundantly clear that there is an immediate increase in unknown and SEM sales which are being driven by the mailed pieces. As expected, the affiliate and email sales do not follow this same pattern.
When Company Y was making business decisions using the original reporting method, they correctly allocated more money to the retail direct program and to the online marketing opportunities, while reducing the budget for catalog marketing. After all, that’s what the reports were telling them to do. Once the performance reports were revised to account for the cross-channel behavior, it was clear that decision was wrong. They were misallocating budget and business would have continued to decline.
These studies emphasize the need for marketers and executives to understand the cross-channel behavior of consumers in this world of converging channels. We market to individuals, not to channels, so it is imperative that we understand the behavior of our customers and can craft business rules that accurately reflect the source of demand upon which we base corporate decisions.
CIRCULATION TIP
Records Without Email Addresses – How Well Do Yours Perform?
By Jim Whitford, Marketing Manager
Almost every multi-channel business has seen a reduction in the number of orders flowing through the call center and, conversely, an increase in the amount of orders coming in via the web. The focus of email campaigns and other internet marketing is quickly shifting in emphasis towards customer retention. For many firms, convincing an existing customer to buy again may only require a single email.
Not all customers, though, respond to or reactivate from email campaigns. And what should you do with customers for whom you do not have an email address?
LENSER recommends testing segmenting customers by the existence or non-existence of a valid, active email address, and measuring the response differentials. If customers do not provide an email address, most likely, they are not buying from your website—especially since most sites require an email contact address to place an order. Below are a few major reasons why customers do not provide an email address.
- Some customers are not web savvy. While this group of customers is becoming a smaller portion of your housefile, not everyone is computer literate—not yet, anyway. Certain merchandise categories cater to certain demographics. Be aware of your customers and their online comfort level.
- Fear of identity theft. In reality, identity theft can occur anywhere, but many customers still feel more vulnerable making online purchases.
- B2B or SOHO customers that have never purchased on your website. Many B2B customers place larger orders, purchase orders, or custom orders that cannot operationally be placed online and consequently, require more personal attention.
- Customers opt out of receiving email promotions. It goes without saying—these customers cannot be marketing to online.
Review your housefile. Check to see the percentage of records without email addresses. Be sure to include customers who have provided email addresses but have opted out of receiving email promotions. Recent tests have found catalog response rates of older non-email customers to be as much as 20% higher than customers with similar RFM attributes who have given you an email address.
CREATIVE TIP
Better By The Bundle
By Carol Worthington-Levy, Creative Partner
Selling more is always better than selling less; this would seem obvious taken at face value! But we don’t always work as hard as we should to get those larger orders. That’s why whenever possible, I recommend creative bundling of products and services to both improve a bottom line, and increase customer satisfaction.
While one would think it is ALWAYS good to sell product, there is a point where too small an order actually hurts more than helps. This is one of the first places that selling by the bundle pays off.
What would make a good bundle? Just think of any items that you’re selling near each other because they complement each other, and you’re halfway there. Instead of selling a planter and its pieces, and then offering the refill soil and fertilizer kit as a separate line item, here’s a chance to sell it all as one big bundle, and give the customer a little savings (don’t forget to tell them how much savings!) if they buy the whole set. I’m even suggesting that you would LEAD with the bundle, and then follow with separate line items if they want just the individual pieces.
What are the advantages of this to you? They are twofold:
- You increase your average order size, a worthy goal for all of us. Even though I am suggesting you discount it slightly, it takes less labor to sell more in one package than to sell each item separately. It also costs the customer (and you) more in postage to have these items shipped separately.
- You increase customer satisfaction. For many “bundles,” the customer’s satisfaction is greater if they’re getting more of what they like, and you’ve shown them what works well together. Less chance for failure means a happier customer.
By bundling, I am not simply stopping at selling item A for $59.95 and refills for item A listed below for $19.99. I’m talking about selling them item A for $59.95, and then offering them the item with a convenient refill for the great price of $74.99 – a $5 savings!
And by bundling, I’m not just describing putting 5 John Wayne Cowboy DVDs listed in a row at $19.95 each; I’m talking about calling it the John Wayne Cowboy Flicks Collection, and selling the five disc set for just $89.99 – a $10 savings! Then I can tell them that these DVDs are also available individually on your website.
Must your packaging reflect the bundle? Or, in other words, if you sell this “collection,” must it be in its own special case? Not necessarily! If you’re not showing a set or bundle in a fancy box or slipcase, you are free to sell them the bundle without changing the packaging. We discovered this a few years ago when we started bundling sets for Blackhawk, a Republic home video seller. We bundled Tarzan sets, Fred Astaire sets, Musicals, and more – and took the average order up $20 MORE than it had been before. This made them much, much more profitable. It appealed to their customers, too, who liked the idea of building their film library of collector flicks.
Not every bundle will work for you – and it may require a little bit of experimentation. But give it a try! Selling a cookie cookbook with a set of your own exclusive cookie cutters will excite the customer much more than selling them separately. Giving them savings when they buy the chair and ottoman together can make the customer happier on more than one level – and it will make your bottom line happier, too.
MULTICHANNEL TIP
House File Segmentation: Channeling Best Practices
By Todd Miller, Director
For several years now, LENSER has been recommending that, for the purposes of direct mail campaigns, multichannel retailers segment their house file by the channel(s) customers have used. This month’s multichannel tip summarizes LENSER Best Practices concerning this topic.
Step # 1: Consolidate multichannel permutations into actionable segments. One can get stuck in analysis paralysis if all possible permutations regarding channel are considered:
a. Catalog (i.e., Mail / Phone / Fax), Internet and Retail Store
b. Catalog, Internet
c. Catalog, Retail Store
d. Internet, Retail Store
e. Catalog Only
f. Internet Only
g. Retail Store Only
Ugh! What a nightmare! Can you imagine how many unique segments that would create when combined with RFM variants?
Below is a better approach:
Catalog = the combination of all customers falling into groups a, b, c, and e
Internet = the combination of all customers falling into groups d and f
Retail Store = all customers falling into group g
This system allows multichannel retailers to isolate customers who have never placed orders via mail, phone or fax. Not surprisingly, it is precisely these groups of customers that produce limited incremental ROI when mailed against holdout panels.
This leads us into our next step.
Step # 2: Determine some common sense exceptions to the rules. Even the best of constitutional documents need an amendment or two.
Below are a few to ponder:
- Internet orders where the Catalog Quick Shop feature was used should, instead, be flagged as Catalog orders.
- Internet orders where items with SKU prefixes found only on merchandise displayed in printed catalogs are ordered should, instead, be flagged as Catalog orders.
- Internet orders where a catalog-attributable key code is provided should, instead, be flagged as Catalog orders.
- Catalog buyers who have not used the channel in some reasonable timeframe—two or three years, let’s say—should be classified under a more recently-used channel, if applicable.
- In the merge, prioritize Retail Store Only Buyers below Inquiries and perhaps even below Gift Recipients / Ship-To Addresses. LENSER’s observation, to date, has been that catalog requesters produce a greater ROI on print advertising investment than retail store buyers, assuming equivalent recency. This pattern, though, has not been consistently observed with regards to giftees / ship-to’s.
Step # 3: Develop a contact strategy that maximizes print advertising ROI. The key measure here is incremental sales per catalog mailed.
Below are some tests to consider:
- Seasonally, reduce the number of contacts to Internet buyers with similar RFM attributes to their Catalog buyer counterparts by one, or, longitudinally, reduce the number of contacts to Internet buyers by 30 – 50%. Understandably, this is a fairly bold test I am suggesting—it can be executed, though, with minimal risk to your on-going operations. Just be sure your holdout panel quantities will produce statistically significant results.
- In comparison to circulation plans that were executed in years past without channel segmentation, mail deeper into Catalog buyers and, conversely, less deep into Internet buyers. All else being equal, it is a safe assumption that customers who have a proven track record of responding to catalog offers will perform better than those who never have.
- Do not neglect your best-of-breed Retail Store Only buyers! Time and time again, we see excellent incremental response from high frequency, high average order, repeat Retail Store Only buyers. If your marketing team is skeptical, or if your store group cries cannibalization, conduct a test where the holdout panel is the control and the mailed portion is the test cell—and further allay their fears by slapping a front cover dot whack driving business to the store in question.
CLIENT HIGHLIGHT—MOSS MOTORS INC.
How many of us can point to a single purchase that would completely change the direction of our lives? Sixty years ago, Al Moss had such an experience when he purchased an MG TC automobile. Al became an avid MG TC enthusiast and after learning about road rallies in other parts of the country, he began to organize some of the first rallies on the West Coast. The first rally ended in Santa Barbara—which now happens to be the home of the company his early passion for British sports cars helped create. Fellow MG enthusiasts that Al met through the rallies shared not only his passion for classic automobiles, but also a common problem: difficulty finding service and parts for them. Al saw an opportunity and opened an MG repair shop.
 While initially the emphasis of the business was on service, the limited availability of parts created an even bigger opportunity. After moving to nearby Goleta, CA, he established his first MG parts catalog in 1962. Over time, he expanded his catalog offerings to other British models such as MGA, MGB, Austin-Healey, and Jaguar. In 1977, Al even purchased 48 tons of “obsolete” inventory from Standard Triumph in England—the largest single buyout of its kind within this industry.
By 1977, Moss Motors was an established industry leader. Howard Goldman, a long-time friend of Al’s, offered to purchase the Moss Motors operation. The lure of being able to spend more time pursuing his real passion of restoring and racing his collection of British sports cars was just too great—Al finally agreed to sell.
The business grew rapidly under Howard's direction. Shortly after the acquisition, Moss Motors moved to a new, more spacious facility in Goleta and continued to revise the catalogs and expand the line with a greater emphasis on product research and development.
Many critical parts of these cars were no longer available and many classic British cars were on their way to the scrap yard—simply because the parts were no longer being manufactured. In order to keep the business and the hobby alive, Moss Motors took on ever larger development projects and eventually established a complete upholstery manufacturing division, producing show quality interiors. This effort continues to be a great strength of Moss Motors, emboldening their place as an industry leader.
By 1988, Moss Motors was the largest supplier of vintage British sports car spares with warehouses in both Goleta, CA and Dover, NJ. Through the 1990's, Moss Motors continued to grow both through acquisitions and solid business practices. By 1998, Howard decided it was time to step aside and leave the next generation of growth to a new team. Company President, Glen Adams and Howard's son, Robert, formed a holding company, Motorsport Products Group (MPG), and purchased the assets of Moss Motors, Ltd.
Much has changed over the years for Moss Motors. Still known primarily for it activity in the British restoration market and for being as the world's oldest and largest supplier of these parts, Moss Motors has also expanded its service to include products for Mustang, Miata, the Mini, and Ford F-150 enthusiasts..
Much, too, has remained the same over the years for Moss Motors. This year marks the 60th anniversary of the company that Al Moss founded. To this day, true to the principles on which the company was founded: They offer superior products designed to help enthusiasts enjoy their hobby.
To learn more about Moss Motors and pursue their incredible array of parts and accessories, be sure to visit www.mossmotors.com.
EMPLOYEE SPOTLIGHT—JERRELL LEWIS
When Jerrell earned her B.S. in Marketing from San Diego State University, she did not imagine a career in multichannel direct marketing. "After college, I went to work in the advertising sales department of a trade magazine," she said. "I liked it, but after about three years, I was ready to move on. By chance, I found a posting of a job at Monterey Bay Clothing Company. After working in advertising, it was really interesting to work in an environment where sales could be measured."
Jerrell had worked at babystyle for almost four years when she felt that the business was moving in a direction different from that which she wanted to go. "When I put out feelers about making a change, a few colleagues mentioned that Restoration Hardware was looking for an acquisition planner," she noted. "While I was hesitant to move up north (way too cold for my taste), when I interviewed I knew it would be foolish not to pursue working with a world-class company."
This experience gave her the opportunity to analyze and develop circulation plans for catalog, web and retail trade areas, as well as being highly involved in the development and implementation of a new mover program.
To keep up with day-to-day client demands, LENSER needed to recruit, and Jerrell's name came up in every conversation. "When the opportunity arose at LENSER, I was immediately interested," she remarked. "I’ve heard for years what great things were going on at LENSER and I knew I would learn from the best. What struck me most, however, was everyone I discussed it with said that almost no one ever left! In addition to a challenging, growing company, I was also interested in a good work environment, and I found that at LENSER."
"We were extremely fortunate to bring in someone with Jerrell's experience and skill set," lauded Michelle Houston, VP of Client Services. "Her in-depth experience has allowed us to assign her some of our biggest and most difficult accounts and she has performed beyond our expectations in such a short amount of time."
Jerrell still thinks it is too cold in the Bay Area compared to her home in southern California, but LENSER keeps her warmed up. "My favorite part of the job is learning about the nuances of the business of each of my clients. I really like the collaborative environment working on the different accounts, both with the client and internally with my LENSER colleagues. The most challenging aspect to work right now, however, is somewhat a reflection of the economy. With many mailers seeing soft sales, it is a constant challenge to find new ways to boost sales."
Outside of work, Jerrell enjoys reading, watching movies, weekend trips, relaxing at home and of course, going to the beach. "Warm sand," she laughed, "is probably what I miss the most about Southern California!"
To learn more about Jerrell Lewis, please visit her bio.
AFFILIATE FOCUS—DHL SMART & GLOBAL MAIL
How quickly are you fulfilling those hot catalog requests that have been coming in on the phone or through the web? "It’s a well-documented fact that when less time elapses between the request and the receipt of a catalog, the response rate and average order value will be higher," says John Lenser, president of LENSER. "Thus, it is an advantage for you to reach your customers as quickly as possible. You may remember QuikPak. Well, they are part of DHL now and that's why we reached out to form a strategic partnership with DHL Smart & Global Mail for our clients."
DHL Smart & Global Mail offers SMARTMAIL CATALOG FULFILLMENT FLATS (for pieces under 1 pound) and CATALOG FULFILLMENT Bound Printed Matter (for pieces 1-15 pounds), which are full-service mail solutions providing a convenient and effective way to fulfill a catalog request or send owner's manuals, welcome kits or other types of printed matter. DHL Smart & Global Mail has a state-of-the-art warehouse management system and operations allowing for pick, pack, sort and drop ship into the United States Postal Service (USPS) mail stream.
There are two service levels available to meet your needs. You can expect nationwide delivery in 2-5 days with their expedited service or 5-10 days with the budget service. Remember that catalogs are still an excellent driver for creating desire in a customer's mind and you want to satisfy that as quickly and imaginatively as you can. This is a fully automated, state-of-the-art fulfillment service, with complete customization options. Imagine your potential customer's surprise when the catalog they've requested arrives at their front door in less than a week!
Once you've got that valuable order, how are you quickly and economically fulfilling it?
If your business sends large numbers of packages under one pound (even in boxes of all sizes including padded mailers and sleeve-wrapped materials), they qualify as USPS “Parcels,” and that could mean lower cost with faster delivery with DHL's SMARTMAIL PARCEL service.
If you have parcels weighing 1 to 70 lbs. that do not qualify for the minimum volume requirements of the DHL@home program, DHL offers their SMARTMAIL PARCEL PLUS, a full-service domestic residential parcel solution with the same advantages, including track and trace visibility.
Whether it’s one pound or seventy, DHL Smart & Global Mail ensures that mail reaches your customers via SMARTMAIL PARCEL or PARCEL PLUS. Through their workshare partnership with the USPS, they offer a full-service mailing solution with a quality controlled process to move your packages with precision. "After picking up your mail," says Kim Chapman, LENSER's DHL representative, "we will sort and process the pieces at one of our nationwide Mail Terminals, transfer them to the destination postal facility and insert the items deep into the mail stream. This efficient process allows for greater control and visibility."
As we continue to strengthen our breadth of services, LENSER has identified and carefully screened key services to support its clients, representing the best in their areas of expertise. As part of the LENSER promise, each of these companies will keep its fees competitive and “always go the extra mile” for LENSER clients. We have successfully partnered with DHL Smart & Global Mail to our clients’ direct benefit. To get in touch with Kim Chapman at DHL or any of our other affiliates, please contact Michele Salmon at 415-446-2511 or e-mail
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NEWS BRIEF
- Are you ready for the 2008 Annual Conference for Catalog & Multichannel Merchants (ACCM) taking place May 19-22, 2008 at the Gaylord Palms Resort in Orlando, FL? For those of you who have not attended the ACCM, LENSER strongly urges you to come. The ACCM will focus on the strategies you need to successfully integrate your catalog, web, store, phone, sales force, distributor, email and other marketing channels. The conference is the event of the year for catalogers, providing three packed days of educational seminars and many opportunities for networking. LENSER staff will present several sessions covering catalog circulation, channel integration, and creative issues. Register Today and Save up to $100 on your full conference registration! Go to www.accmshow.com and use the LENSER savings code LEN for your discount when registering. Let us know if you plan on joining us—we look forward to seeing you in Orlando!
- If you would like to schedule an appointment at the ACCM in Orlando, FL, May 19-22, 2008 to discuss your specific needs, please give John a call at 415-446-2501 or send an email to
. We know that we can make a very positive contribution to your company’s growth and bottom line profits. We're pleased to discuss your challenges and help you discover all the ways your business can become more profitable even in tough times.
- Congratulations to our own Travis Seaton on his promotion to Vice President, Multichannel Marketing Consultant here at LENSER. Travis joined LENSER in 2001. To read more about Travis, click here.
- To ensure delivery of your monthly eNews from LENSER, please remember to add newsletter@lenser.com to your address book. To sign up for the LENSER eNews, please contact
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