Intelligent databases provide more focus and desirable results
Many distributors agree that direct mail is an ever-popular tool. Customers want to get their messages—whether through ads, surveys or benefit fulfillment pieces—into the hands of potential end-users, and mass-mailing directly
to homes and businesses is an effective way to do so. But a mailer is only as effective, and as profitable, as the suitability of its recipients. In other words, significant profits can be lost on wasteful mailings.
As a result, distributors are finding ways to better target their customers' markets with the help of new technology. "Anyone can take an item and mail it anywhere. But, successful companies use the intelligence of databases," said Chris Iafelice, direct mail sales representative, The Shamrock Companies, Westlake, Ohio.
Bob Cronin, president, Mac Graphics Group, Oakbrook Terrace, Ill., concurred. "We are seeing smaller, more targeted mailings," he said. "And customers who want to reach the right consumers will utilize our expertise in the consumer market."
So how is this affecting profits on direct mail print jobs? Iafelice reported that the product's relative margin is dependent on the size of the mailing and type of services offered. "If all a distributor does is put paper in the mail, there is not much of a margin," explained Iafelice, "but if distributors utilize intelligent services, the margin is higher."
Cronin, on the other hand, believes the relative margin of this product is ever declining. "I just think there is an overcapacity of production in the market for direct mail," he said. "Because of that it is awfully cut-throat."
This is where thorough sales training can make a difference. According to Cronin, if a distributor makes a good investment in sales force education, everyone will benefit greatly. In his opinion, hands-on training is one of the better methods. "We've found that this is the most effective way to train," he said. "This allows direct mail representatives to experience every facet of the process while gaining the knowledge needed to get the job done right."
At Shamrock, individual training processes for reps assigned specifically to the direct mail sector tends to be continuous. "Our training is very involved," Iafelice said. "We go to postage seminars and we take advantage of hands-on training. We are very focused—in fact 90 percent of our time is used to seek out further education."
Just like many printed products, the amount of time it takes to complete a direct mail sale is determined by the type of campaign it is. Iafelice noted that some sales go through in as little as an hour, while others can take six months or longer.
In terms of production costs, Cronin indicated that direct mail can be a very cost-effective way of reaching customers. "It can be as simple as a postcard or as complex as a multifaceted piece," said Cronin. "The cost of production, as well as delivery times, vary accordingly."
Because of the design flexibility of direct mail and the ability for businesses to better control where it is going, distributors predict that the usage of this product will continue to grow.
"Direct mail is not a new trend, it is a staple of our industry," said Cronin. "Businesses know that color and creativity sell, and direct mail provides a great opportunity for their message to be seen."
Iafelice agreed, adding that only the most educated distributors will prevail in this crowded market. "I think that there are a lot of people who want to be in this market. Those that survive will have taken time to learn it," said Iafelice, noting that the greatest expense in direct mail is postage. "Those that understand postage structure will succeed. If a distributor can save his or her client in postage by taking the time to learn mailing methods, then he or she is doing them a great service."
She concluded by explaining that, despite the recent increase in postage, postal rates were reviewed again in early February. "There will probably be another increase in the near future," she noted. "And the method of preparing mail has dramatically changed. Only those who stay knowledgeable in that area will better serve their clients."
By Sharon R. Cole