There are a limited number of potential rare bird buyers in Agawam, MA—at least not enough to justify the cost of a direct mail campaign. But Dave Ratner, the owner of Dave's Soda and Pet City, found a way around that.
He partnered with The Golden Cockatoo, a Florida store far outside his selling area, to do a joint mailing. All costs were equally shared.
The first savings came from the rental of the Bird Talk magazine mailing list. Ratner and the Florida store submitted several ZIP code selects near each location to Mal Dunn Associates, of Brewster, NY.
If each retailer were to rent the list by themselves, they would be required to take a minimum of 5,000 names for a cost of up to $135 per thousand. In the end, they stilled mailed less than the minimum—roughly 1,000 pieces altogether—but the impact was reduced.
Other savings came from the joint mailing piece. The stores are using the same front image on the 5x7 postcards designed by Ratner: a photo of a Sulphur-crested Cockatoo wearing a hat. The photo's caption reads "A gazillion new toys, and they bring me home this."
However, each store is able to customize the back. The Florida store's average transaction is roughly double what Ratner pulls in, and the incentives on the back of each mailing reflect this difference.
The two companies did save a little money on creative design, although as they were targeting two radically different areas they weren’t able to save much on postage costs. But two complementary firms could have shared mailing costs by going into the same envelope, Ratner notes.
Why use mail at all? "Here's where the typical person doesn't understand the power of direct marketing," Ratner says. "They say: 'Are you out of your mind, spending $400 to $500 to reach 1,000 people?' I have to bang over their heads that these are 1,000 people who have birds."
In contrast, Ratner adds that a newspaper ad might be considerably cheaper and reach 10,000 people, but if only 2% have birds the cost per potential customer is considerably higher. And even if the birdcages need new lining, these bird owners might not buy the newspaper on the day his ad is printed.
What about legal protection between the two partners? In this case, Ratner decided to do a handshake deal. “I trust him,” Ratner said. “I guess I could get burned, but I think you would end up spending more on a contract and protecting yourself than it would be worth.”
Ratner offers these ideas for making your partnerships successful:
*When picking a partner, find one already sold on the value of staying in touch with customers. Know how your partner’s business stands in its community. For example, is it a member of the local chamber of commerce?
*Printing and list orders should not be placed until you get a deposit from the partner (assuming you are the quarterback for the project).Or, arrange for separate billing if a mail run is being split between the two companies.
*Approach the manufacturer of the product you're selling. That firm may be willing to provide support in the form of seed capital or names from its own mailing list.
*Negotiating expiration dates for offers can be tricky: Some businesses have longer lead times, while others may want imminent expiration dates to create a sense of urgency.
*Make a partner out of your mailing house! What small businesses may not know about U.S. Postal Service requirements, mailing houses can often fill in. Additionally, they can often offer valuable suggestions regarding either mailing piece design or money-saving sizing and printing suggestions.
*If your in-house contact list contains multiple individuals within a household, such as two or more loyalty club participants, remember to deduplicate the names before sending out offers.
