3 New Direct Mail Tricks for Old Testing Rules
Every professional manager in direct marketing knows there are only two sacrosanct rules: Rule No. 1, test everything; Rule No. 2, see Rule No. 1.
I started out on the management side some 40 years ago and got acquainted with the bricks and mortar of testing before the advent of chi-square analysis: A "reliable" winner in tests of 10,000 or more pieces of mail, or A/B splits of national magazines, had to pull more orders than double the square root of the "loser." Thus, 121 was deemed to be a reliable winner over 100 in an A/B split of 10,000 pieces.
As consistency was found in winning performances, "rules" sprang up. We shared our rules with Wunderman, Rapp & Collins, and our other agencies, and they shared theirs with us.
When I switched to the creative side, I met Dick Benson. He was a consultant to many top publishers and, at the same time, a direct marketing entrepreneur. He ultimately would become publisher of the largest circulation newsletter in America.
Every direct marketing entrepreneur, manager, copywriter and consultant—even before the days of Claude Hopkins, J.K. Lasser, John Caples and Max Sackheim — had their own rules, "secrets" or "discovered truths." Benson tested, modified and codified those rules that applied specifically to direct mail, especially in publishing, making them his own, and added others that came out of his client work and newsletter business. The result is Benson's "Rules of Thumb," which he published in "Secrets of Successful Direct Mail" (NTC Business Books, 1987). He cautioned, "Nothing works all the time, but ignore any of these rules at your own peril."
RULE No. 1: A credit or 'bill me' offer will improve results by 50 percent or more.
The 50 percent improvement assumes that the control offer is cash with order. Prescott Kelly, publisher of the Children's Writer newsletter and self-improvement books, says 50 percent is within reach in a preexisting relationship. Copywriter Peggy Greenawalt sees "bill me" and credit card packages as important, "but [publication] clients now insist on higher net response and up-front cash using voucher packages."
My take: "Bill me" may apply more specifically to a low-cost, multiple-unit impulse sale, such as a periodical subscription, but it also appears likely that the particular form of credit, debit or deferred payment that tests strongest against cash, especially in this economic climate, will validate Benson's rule.
RULE No. 2: Adding to a package is more likely to pay out than cutting.
Benson preferred to test whole packages to make a breakthrough, rather than testing increments; and he generally tested the packages exactly as written. Following a successful package test, he tested additions to strengthen results.
Bryan Judge, president of a home-study school, has had notable successes in adding full color, inserts, testimonials and other elements in Standard mail; he also has made successful additions to First Class packages while staying within the "winning" postage level, or lightening the package to get it under the next level.
Kelly would add rather than subtract, although he cites two winning jumbos, one consumer and one business, that lost to 6˝ x 9˝ versions.
My take: Benson's rule still holds. Test additions before you test subtractions.
RULE No. 3: Dollar for dollar, premiums work far better than cash discounts.
Most direct mailers have a preference for premiums over cash discounts. Greenawalt says "cash discounts cheapen perceived value"; fellow copywriter Mark E. Johnson points out that "a $5 cash discount always costs you $5," while a premium with a perceived value well above $5 often can be produced for $1. Judge likes premiums because "you can sell harder against them." Consultant Grant Johnson says premiums work because "people prefer tangibles."
My take: Keep on looking for and testing new premiums.