2 Do’s, 2 Don’ts for Direct Mail Gift Offer
With the economic forecast cloudy for prospects and mailing costs downright gloomy for direct mailers, the direct mail gift offer is getting the squeeze. Sometimes it’s being pushed to the Web; other times, once-vital parts of the offer are eliminated altogether, such as for budget reasons or mail processing challenges (lumpy freemiums that cannot take the “squeeze” and are not machinable, thus incurring hefty shape-based surcharges).
However, gifts in the mail aren’t going anywhere. Here’s how they can and cannot be adapted.
Do #1: Do Keep Premiums in Play
When asked if he was planning on testing out of certain premiums because of rising costs, Ted Grigg, principal of the direct marketing company DMCG, based in Lewisville, Texas, answered with an emphatic, “No.” With an insurance company client, for example, DMCG just changes the premium offer. “When we renew our insurance contracts with customers, there is usually a rate increase. We soften the blow by offering them the option to decrease their health benefits, for example, for the same price—or even less—than they were paying before the renewal,” he says.
Of course, Grigg recognizes that rising postage costs leave less money for production and premiums, but that just increases the pressure to get more with less. “Gifts will not go away; [direct mailers] will offer less or find premiums that lift response enough to pay for the higher cost for postage,” he posits. Instead, Grigg recommends the standard cost-cutting move of eliminating marginal or less responsive names from the control list.
Do #2: Do Increase “Virtual” Freemiums
With shape-based rates through the roof and lumpy freemium packages on their last legs, mailers need something other than labels and notepads to use as freemiums, which remain a popular idea with prospects. How about virtual freemiums, such as codes for online discounts? Grigg believes these are good ideas in the current climate, saying such a digital gift “lowers cost for the mailer and gives the mailer an opportunity to upsale during the Internet visit.”