Response at What Price?
Because direct mail offers marketers the ability to conduct tests of new ideas in relative secrecy, it often reflects shifts in marketing trends long before they become mainstream.
We're noticing what could be the beginning of a movement away from voucher packages and professional discount offers, which could signal a reluctance on the part of direct marketers to base their selling propositions so heavily on price (see the write-up on the new and amazingly fresh control from People magazine on page 7).
After all, prices in the retail sector keep plummeting to entice shoppers into the stores. It seems these days that only a bargain is going to pry open the wallets of price-conscious consumers. But how much effect does the retail sector have on direct sales channels?
According to the "Libey-Concordia Economic Outlook" for May 2003, although the nation witnessed the softest economic performance ever tracked by the report, the catalog industry continued to hold coursesuggesting that businesses with niche positions that communicate value in their offerings to consumers will be more impervious to the kind of price slashing taking place in the retail sector. And there are some bright spots on the multichannel front that further support the case for the niche/value proposition: A March 25, 2003, article in the New York Times noted dramatic sales growth for men's clothier Jos. A. Banks, which has invested in strategies such as good/better/best merchandising and thank-you notes sent to customers.
Another benefit direct response marketers have in their favor is the convenience factor. A recent cover story in Time magazine reported on the widespread cost-cutting of U.S. businesses that has resulted in smaller paychecks for a growing percentage of Americans coupled with longer workdays driven by productivity demands. This double squeeze on consumers means they will be scrutinizing where they spend their dollars and their timea good opportunity for direct response marketers to play up the convenience of shopping from home and the uniqueness of their merchandise.
According to marketing research firm Yankelovich, the lengthened workday, coupled with the anxiety consumers feel right now in respect to their lack of control over their futures, fosters a stay-close-to-home mentality that is driving consumers to invest in making their homes safe havens. This is yet another opportunity for marketers to take a fresh look at what they have to offer prospects and customers, and to position it in a way that fits this market trend that looks to have deep roots.
In all, the messaging of the day is not how low can you go on price, but what value proposition can your product or service bring to the busy, frustrated consumer looking to maintain control over his or her life?