Blending the Old With the New
TransPromo has received a lot of attention recently as industry pundits highlight the benefits and vendors promote solutions. There are great potential benefits to be gained, but will the current economic conditions slow down or accelerate a move to TransPromo? As a consultant working with many clients on solving both business and technical problems, I regularly think about the current challenges and opportunities in the transactional and the direct mail industry. TransPromo is not a luxury; it's a strategy to help deal with the current economic situation. Now more than ever, mail-based, and indeed all, communications need to become more relevant and cost-effective.
TransPromo has many different definitions. For our purposes, I would like to offer a definition that I believe represents the opportunity. TransPromo communication is the intelligent leveraging of the transactional document to drive customer behavior and create incremental opportunities for business. This can be in the form of education, customer satisfaction enhancements and cross-selling or upselling an existing customer. Effective TransPromo techniques require relevant messaging. TransPromo delivers benefits that create a strategic advantage in today's difficult economic environment.
TransPromo can reduce marketing waste. Every organization is interested in improving performance and most have adopted continuous improvement processes and tools. Mail already is measurably more effective than print and broadcast media; however, there are still big potential gains to be made.
Transactional documents are mailed to current customers, who represent an opportunity to not only increase revenue but to also significantly increase margin. With an openability rate exceeding 95 percent, transactional mail trumps personalized, unsolicited direct mail which has, on average, a 48 percent openability rate, according to InfoTrends. For existing customers, transactional mail is more efficient from a marketing perspective. In addition, because true TransPromo embeds messages within the statement, generic inserts (which are easily discarded from transactional documents at the household) are no longer necessary.
The significant increase in profitability results from growing existing customer relationships rather than from incurring customer acquisition costs. Relevant and targeted messaging can be based on customer psycho-demographic information to present premium higher margin products and services to those with the means and interest to accept them.
For tracking TransPromo results, campaigns can build in unique key codes and links for collecting precise one-to-one data. Key codes are captured as consumers arrive at touchpoints to create campaign metrics and analytics. This behavioral data indicates high performance features for future campaigns. A technology that is rapidly gaining momentum for this purpose is the QR code—a quick response, two-dimensional barcode. This code is capable of storing offer information and facilitating hot links to URLs and PURLs for redemption and response metrics. QR codes are scannable by lower resolution cameras such as those found in cell phones and handheld devices.
TransPromo can be more cost-effective. Transactional documents are a critical part of the customer experience and, when properly targeted and executed, command action. It makes good business sense to leverage the investment made in this critical communication as much as possible. According to Pitney Bowes research, more than 75 percent of the cost of mail is attributed to postage. TransPromo mailers are able to significantly reduce these postage costs.
One example is the use of "householding" messages. My bank mails me a checking account statement each month. Because the bank has adopted check imaging, my statement as a mail piece is usually no heavier than two ounces. I also receive other mailings from my financial institution which include offers for premium services, mortgages, credit cards and branch opening notices.
The Table below represents the potential savings that could be achieved using TransPromo. Each company's communications strategies and costs are different, so a specific analysis is prudent relative to existing communications.
TransPromo can be "greener." The fundamental principle of TransPromo is that the message or offer is embedded in the transactional document. The Pitney Bowes Ecowise (sm) engineering team has shown that each insert produces approximately 3.96 grams of carbon emissions. This includes the entire life cycle of the insert from paper manufacturing through to disposal. Removing inserts reduces carbon emissions and contributes to the goal of a cleaner, greener organization.
In addition, any of the mailing suppressed or combined as a result of TransPromo produces carbon savings for paper, envelopes and transportation of those mail pieces. Studies conducted by Pitney Bowes have shown the average one-ounce mail piece contributes to about 109.25 grams of carbon emissions to the environment.
Customers prefer TransPromo. A 2007 InfoTrends survey indicated that mail is the preferred medium among consumers. In fact, 60.6 percent of consumers surveyed preferred direct mail over e-mail, telemarketing and other channels. Consumers also stated in the survey that personalized offers are preferred 63.1 percent vs. traditional statements at 36.9 percent.
TransPromo technology is smart. The output to drive color printers is often not the output produced for existing printers. Issues such as this have provided the rationale for the development of "downstream" TransPromo-enabling technology.
In downstream implementation, the output from document composition remains the same as today and the printstream is intercepted and engineered prior to actual printing. In the printstream engineering process, the printstream is ripped, key information mined and decisions made based upon user-defined business rules. Next, digital assets (copy) are integrated and the printstream is reassembled in the desired PDL. The information mined can be in the form of records, tagged logical elements or, most significantly, the actual content on the document itself.
For example, Bank XYZ wants to offer a premium services account to anyone with a balance more than $5,000 or to anyone with both a checking and savings account and a combined balance of $4,000. The downstream enabling technology is "taught" to search each document and look for key words and balances. If the business rule criteria are met, then digital assets are placed on the document. This technology has the ability to identify both static and dynamic white space. If the user-defined business rules permit, the application can even force the creation of additional white space and pages into the document.
TransPromo brings together the organization. TransPromo represents a hidden opportunity as a catalyst for bringing an organization together—one focused on results, efficiency, cost savings and customer satisfaction. TransPromo programs help create a new environment of collaboration that is more transparent, nimble and focused on the customer. Relationships built between internal business partners will contribute to greater overall efficiency in future cross-functional projects.
Given the measurable benefits of TransPromo marketing efforts, the current economic conditions should be ideal for implementing this new technology. During tough times, TransPromo connects firms and organizations with their customers to drive desired behaviors.
About the Author:
Kevin J. Klein is director of production intelligence consulting and can be reached at email@example.com or by phone at (203) 739-3841. Pitney Bowes has been recognized by InfoTrends and Madison Advisors as providing industry leadership solutions for TransPromo.