Third quarter numbers aren’t so good. What’s new? Except for once again, ‘tis the season to panic.
Or, it’s time to take a deep breath. There are two key things to the success of any business: production and marketing. Production is first. If you don’t make it, you can’t sell it. Marketing is second, because you can’t move that product unless you have a way to show it to your prospects.
Makes sense, doesn’t it?
Can anyone tell me why then, the minute there is a money crunch, the call goes out to cut marketing and production costs? Maybe they can’t grasp the very real connections between production, marketing and profits. Maybe it just takes too much work to do it any other way.
I can see them now, excitedly doing the math. It’s so simple, so easy. If we cut production costs and then marketing expenses our profits will go up. Sounds good, doesn’t it? Take that fuzzy logic a little further and eventually you should be left with just profit. If only it worked that way. Heck, we could be planning our retirement instead of wondering, “What next?”
Here are some frightening, real-life actions that are taken far too often: “Let’s cut the size and number of mailings.” “Let’s have the office secretary put the next mailing together in her spare time.” “We can cut postage by mailing less and we can get lists at a lower cost.” “Hey, my brother-in-law has a disk with over a million names he got free online. Just take the names from there.”
I love the last one especially. As a cost-saver, there is a definite benefit to mailing to a completely wrong list. Since your orders will be down, product shipping costs will drop. Then you can reduce the staff in fulfillment, order processing, packaging and shipping. Go a couple of months like that and the profit picture will look real good.
Of course, in another couple months you’ll be negotiating with bankruptcy lawyers.
So what do you do? The correct action is to focus on the details; experienced managers know this. Yet the decision to cut instead of focus is made by people in management who have only a cursory understanding of direct mail and marketing.
As a long shot you could try starting an education program for your execs and staff to remove the mystery from the world of direct marketing and marketing of all kinds. Teach them about copywriting, about lists and what makes a good list. Have them see just what it takes to make a marketing program work, and that marketing generates profits. You know win them over to your side. All right, so it’ll never happen. That’s asking for way too much.
I guess we’ll just have to rely on the old stand bys: anti-depressants, praying for a miracle and plain old hope.
Albert Saxon, Saxon Marketing, is based in Indian Orchard, MA.
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