School Kids 41 Million Strong & Growing
By Alicia Orr Suman
Young children, ages 5 to 9, numbered more than 20 million in 2000. Add in their slightly older siblings, and you have a market of more than 41 million children age 14 and younger, according to the U.S. Census Bureau.
It's a lucrative market, too. Moderate income families spend $160,600 on average, raising a child from birth through age 17, the U.S. Department of Agriculture reports. A good portion of that expenditure happens during the elementary school years—a time of rapid physical and emotional growth for young children. Just think of all the toys, books and clothing kids consume each and every year as their sizes and needs develop.
With so many marketers targeting their goods and services to school-age children, there's no shortage of lists, databases and media for reaching this market. The way to succeed in a market of this size and scope is to find the right combination of lists and alternative media for your direct response offer.
Big Spenders: From Toys to Travel
Kids and their parents spend more than $18 billion annually on toys, and another $4 billion on video and computer games, reports American Student List Co., the compiler of a list of more than 15 million names of children ages 2 to 13.
But households with young children buy more than play things and kids' clothes. Various marketers of goods and services are tapping this market—insurance, vacation travel, investments, home furnishings and automobiles, to name just a few.
"This is a very dynamic life stage for these young families," explains Richard Greenberg, vice president of marketing at Madison Direct Marketing. Based on what participants in Madison Direct's co-op programs are marketing, Greenberg offers, "Parents of young kids are information-hungry people and look to parenting and general interest resources and magazines for advice on everything from toys and meals to educational IRAs and life insurance."
Shopping for these items direct may appeal to busy families. "We've noticed a defining trend in the parents-with-children market. It isn't Ozzie and Harriet anymore. The pressures working families face are enormous. They want and need convenience," says Greenberg.
In addition to buying convenience products, the way these families do their shopping also has changed. "Products that can be purchased by non-direct means are now being bought direct," he says, citing grocery delivery service Peapod and shopping on AOL.
Do Your List Homework
"Marketers have a lot of avenues to reach this market," says Allison O'Neil, director of consumer list sales, Lake Group Media. There are numerous list sources to turn to—from catalog and magazine buyers to large compiled files.
Start with the lists that have the highest affinity of buyers to your target audience, i.e., the same age, similar unit of sale, lists that are known to be prospecting a good deal themselves, asserts Brian DeLaite, vice president of list management, ALC of New York.
When looking at catalog lists in particular, DeLaite says age is the most important criteria. With a file like Lilly's Kids, he says, "Age is a predetermined factor based on the merchandise they sell." Disney catalog buyers, on the other hand, might be buying for kids or for themselves, he explains, as Disney sells adult apparel, art and collectibles, as well as kids' toys and clothes.
Another way to define age parameters is to suppress certain product categories. "Company Kids sells items for babies and children. Omit the crib and baby comforter buyers, and you've homed in on the school-age kids you want to reach," DeLaite notes.
O'Neil says, "More than half of the magazines and catalogs have a children's select or an age enhancement available, so take advantage of it."
When looking for lists to test, O'Neil says mailers should be aware that while there are plenty of lists, the market for mail-order names is limited. "There are few new catalogs and magazines, and so everyone is fighting for those same mail-order buyers," she explains. Just look at the variety of mailers mailing Zoobooks magazine's list, which Lake Group manages: They range from Pottery Barn Kids and One Step Ahead to Smithsonian magazine, National Geographic and the Phoenix Zoo.
If you have to go outside of your category to rent names, use as many selects as you can to home in on your target, advises DeLaite.
Proper use of selections also is a key to making large compiled lists and databases work for reaching school-age children. While compiled lists typically start with a lower cost per thousand (CPM), their prices can inch up as you tack on additional selects. So choose only those selects that will truly help to define your audience.
In selecting a database file to mail, Byron Taylor, senior account executive, MKTG Services, says, "The key elements here are quality and accuracy of the data, and the coverage of data throughout the file."
When it comes to the next step—deciding which selections to use to refine your database target—Taylor reasons, "As with any offer, you want to make sure that the person your message reaches meets your requirements for interest, demographics, income, etc." He adds that as marketing budgets grow tighter, the importance of finely targeting your promotional efforts increases.
Taylor recommends that marketers and brokers should involve the list manager in determining what selections are worth testing. "Let them know the offer, who the target audience is. The list manager will be able to help you fine-tune your selections," he suggests.
Tips on Renting Kids' Lists
When it comes to renting lists, watch your pennies: They can add up. With all the selections sometimes needed to make a particular list or database work, mailing to kids' lists can get expensive, cautions O'Neil, so it's important to negotiate whenever possible.
A typical kids' response list will cost you $85/M to $100/M, with additional select charges of about $10/M to $15/M for age, says O'Neil. She advises negotiating for discounts when appropriate: "A smart list broker will ask for a cap on select charges. Ask to negotiate these down on a rollout based on quantity."
DeLaite agrees that the market for children's catalog lists is very competitive. "See if the list owners are willing to make any concessions and negotiate on the select charges."
In addition, "There's a high barrier to entry," DeLaite says, explaining that catalogs often offer their lists to one another on an exchange-only basis, and if your catalog file is small you may be out of luck. But, he adds, "If you don't have the volume on your own file to facilitate an exchange with another cataloger whose list you'd like to use, don't give up. Put that list on your wish list and open the lines of communication with that cataloger now so you can go back later and hopefully strike a deal."
Test Time: Other Media Choices
In addition to the breadth of lists and databases available, a variety of alternative print media also exist to reach this market. Among the choices: co-ops, magazine inserts, package inserts and FSIs.
Greenberg asserts, "The best approach to reaching this market is a comprehensive umbrella strategy including image-driving and business-driving [response] elements."
For example, Greenberg says, a financial services company generates a sense of trust through mass media such as TV and print. Then it can talk about the details of what it provides with target-specific messaging using a combination of direct response media.
Co-ops can be an efficient and effective part of that media mix, Greenberg notes, allowing you to select against the database whom you want to target, in which category and at what level of participation you want to mail.
He explains, "You want to hit consumers at as many points as you can. Only 50 percent receive FSIs in their homes; 18 percent subscribe to parenting magazines. So it's vitally important to use a mix of media."