Proper Positioning

Few catalog/multichannel merchants include inserts in their prospecting or retention media plans, a fact that continues to baffle those who use inserts profitably. Most catalogers use bounceback catalogs as a kind of retention insert (though most don’t think of them as inserts). Few consider the strategic value of inserts to their retention rates, not to mention prospecting media mix.

But there are countless other strategic benefits of including inserts in your prospecting. The assorted retention plans that can help you achieve overall business goals are worth looking into. Consider the strategic value of inserts for prospecting and retention separately.

Strategic Prospecting Benefits
1. Inserts are an inexpensive way to test. Both Jill Eastman-Vidal, director of third-party marketing at 1-800-FLOWERS.COM, and Mike Faith, CEO and president of Headsets.com, stress this point.

Inserts cost significantly less than most other media. They allow you to test both new audiences and different prospecting offers inexpensively. Consider testing a package insert before renting a list and mailing a pricey catalog.

Multiple versions of an insert — whether a single offer, lead generator or miniature catalog — can be tested to determine which offer or approach will work best for your business. Insert printers often can collate versions for you.

2. Inserts can be an inexpensive way to acquire customers or generate leads for two-step offers. Cheryl Bagdan, senior accountant for list firm Statlistics, says that given the latest postal increase, inserts can be very cost-efficient as a prospecting vehicle.

When mailings to a given audience do well, Eastman-Vidal recommends catalogers seek out inserts in their package and, if possible, work on an exchange basis to further reduce prospecting costs.

3. Reach untapped audiences you couldn’t otherwise capture profitably. Billing statement stuffers and similar kinds of inserts enable you to reach new audiences, some of which have large prospecting volume potential. Faith suggests catalogers “be open to testing new [insert] forms; you never know when you will find something that works.”

4. Access true hotline buyers. Bagdan points out that package inserts allow you to reach hotline buyers even before their names are on the market. If your success rate with prospecting demands hotline names, inserts should be a component of your prospecting strategy.

Strategic Retention Benefits
1. Test products and concepts “on the cheap.” “Inserts in your own packages are close to free,” Faith points out. You can test anything in your own packages, easily, inexpensively and quietly.

Headsets.com even will test with a simple, photocopied insert to gauge basic customer interest before spending more money in promoting a particular item or offer, Faith says.

2. Introduce new products to your existing customers. Barb McCann, marketing specialist at DrawingBoard Printing, says that inserts are an important element in the stationery cataloger’s strategic marketing plan. “We include inserts for selected products into our monthly direct mail promotions to generate add-on sales for products not featured in our catalogs, such as our personalized calendar business,” she says.

With its new Web-to-print sister company, 123print.com, DrawingBoard uses package inserts to drive DrawingBoard and Grayarc customers to the 123print Web site with introductory offers specifically targeted to those customers, McCann says.

3. Cross-market products to different customer segments. Inserts allow you to put your best foot forward in getting your existing customer to try another merchandising category or to buy from a second catalog you publish.

A cataloger with both apparel and accessories catalogs can cross-market accessories to apparel buyers by promoting the most popular “first purchase” accessory item in their packages. An insert will allow you to have a special offer and focus more on those most popular prospecting items that likely will be the first purchase existing customers make when expanding their buying with you to an additional category.

The Quick-draw Factor
Inserts are an impulsive medium. Eastman-Vidal notes that recipients give each insert two to three seconds to capture their attention; therefore, merchandise offered should be uncomplicated. Inserts work best to generate leads and to drive customers to a Web site or a mailed catalog for details.

Include a clear call to action. With only two to three seconds to grab attention, offers need to be crystal clear. The best results from bounceback catalogs include a strong call to action, as well. This especially is critical in converting new buyers to two-time buyers — a special discount or premium only available to new buyers will grab attention and increase the rate at which new buyers become two-time buyers.

Prospecting insert opportunities come in varying sizes and shapes. Be flexible and adapt. Faith says that, in some cases, Headsets.com uses a two-step lead generation approach; other inserts it sells directly in a one-step approach. On the other hand, Headsets.com has had its best results with a miniature catalog in various places. Headsets.com evaluates each prospecting insert program based on cost and feasibility.

Prospect and retention inserts should be viewed as part of your overall brand strategy and positioning. Bagdan points out that package and statement inserts that are integrated into an overall multichannel company strategy and drive traffic to catalog Web sites can be very effective.

Merchandise offered in prospecting inserts should be representative of your brand, Eastman-Vidal says. Otherwise you may acquire a new customer who never converts into a two- or three-time buyer.

The bottom line is that you’ll maximize results from both prospect and retention inserts by taking a proactive strategic approach. Inserts can help you achieve overall profit and sales goals more effectively and efficiently, but only when they’re part of your overall media mix.

Shari Altman is president of Altman Dedicated Direct, a direct marketing consultancy specializing in acquisition, continuity, DRTV and loyalty marketing. She can be reached at (336) 969-9538 or saltman@altamndedicateddirect.com.