This week’s question: What’s the outlook for the holiday season and what are brokers doing to encourage mailers? Our current panel features Tom Colwell of Conrad Direct, Don Eaker of Wave Direct, Ed Krug of True North List Marketing, Michael Peterman of Veradata, Stefanie Pont of Pont Media Direct, Harold Pratt of Pratt Direct Inc., Kathy Tribel of Lawrence Direct Marketing Inc. and Michele Volpe of Media Source Solutions. Would you like to be considered to be a member of our roundtable? Contact Larry Riggs at [email protected].)
Thomas Colwell., vice president, Conrad Direct Inc.:
The outlook is tough to call at this point. In the nonprofit sector, it is a good time to raise funds, probably the best time of the year. The political nonprofits are seeing mid-term elections and there are many issues on which to mail. The environmental mailers are mailing on the oil spill, so there seems to be activity. Brokers are or should be directing their clients to continue to mail. Some cutbacks are understandable but slowing the program will have an impact 12 months from now when the house files are smaller. This is the primary season for any commercial and catalog mailers and they should be continuing to test, test, test so they can get their best readings and be able to compete in slower months. Brokers are going no-holds-barred on their requests for better nets and price deals while list managers are offering discounted pricing for test orders and non-competitive mailers.
Don Eaker, national sales director, Wave Direct:
It’s going to be business as usual for the business-to-business side. The business-to-consumer side is showing lowered costs per thousand for compiled lists, both e-mail and postal. As brokers, we should be sourcing new options and offering tests to our clients now to help spur direct marketing efforts for the holiday season. We need to be industry cheerleaders, encouraging our mailer clients to not sit and wait to see how the season rolls out, but to meet the challenge head-on and proactively market their product. In times of uncertainty, action promotes you above the quiet marketer, and gets you above the background noise level of non-participating mailers. This is the time to not maintain but grow market share, and scaling back mailing plans will not accomplish that.
Ed Krug, vice president, True North List Marketing:
Early signs indicate the holiday season’s sales will range from slightly up to flat although online channels will continue to grow. Online sales should continue to increase at a 15% to 25% clip. Direct mail will remain flat to slightly up depending upon the market, although it should continue to play an important part in one’s overall marketing strategy. On the list side, cooperative databases will provide more prospecting names since fewer new, quality lists are coming onto the market. Fewer vertical market lists coupled with good customer and response models will encourage mailers to increase their testing during the pre-holiday season in order to seek replacement files for those lists that have dropped below the breakeven point due to the postage increase. Also, brokers should encourage mailers to get involved in the process of uncovering any and all new prospecting opportunities —many marketers are unaware of low cost channels like TV, radio, newspapers and magazines can be to test. Costs have come down dramatically for both production and media. Today a marketer can place 30-second spots on cable TV for as little as $10 to $15 per spot based on bulk buys. Production costs to create a 30- second spot can cost between $7,000 to $12,000.
Michael Peterman, CEO, VeraData:
‘Tis the season to retain your customers. This holiday season is different than years past. Marketers are taking a more conservative approach. While there is a wave of heavier acquisition spending in the b-to-b space, there is a focus on customer retention/reactivation/cross sell in the consumer space. Brokers as a whole are more proactive than normal, but seem to be sticking to the status quo in most cases, which is incongruent with the current trends. The push this season is to not lose customers more-so than capture new customers. Knowing this, it changes the way we enter this mailing season. Brokers are rolling up their sleeves more than ever before, digging into client databases, working with marketing directors to identify the best segments within their internal files and the acquisition segments contributing most significantly to their renewal/multiple buyer efforts. As a group, we can help support our clients by providing better segmentation options with data appending, offering enhancements for integrated efforts (such as e-mail appending), providing long term value analysis for segmentation by record origin (looking at what data provides the best long term value) and so forth. Our roles as brokers are expanding, just like the needs of the clients we serve.
Stefanie Pont, managing partner, Pont Media Direct:
Several of my clients who are affected by holiday sales are still looking into the crystal ball to see how much they want to spend in an undetermined customer spending environment. I would imagine that holiday plans are going to be determined later than usual, and will be more efficient (i.e. smaller) than in years past.
Harold Pratt, chief executive officer, Pratt Direct Inc.:
My clients are not heavily dependent on holiday shopping.
Kathy Tribel, List Broker/Manager, Lawrence Direct Marketing, Inc.:
Mail dates for our client lists are basically booked through November already. I attribute a lot of that to the fact that a lot of our lists work well for political mailers.
Michele Volpe, vice president of sales and marketing, Media Source Solutions:
I think this holiday season will be up over last year, despite the hike. I think we all are hoping for a better season. I’ve read varied reports and I’m picking the good one. Of course you want your mailers to consider “look alike” files as much as possible. But now is the time to use out of the box thinking to find other files that work. It’s important to keep testing.
Network
