There is no more important predictor to successful direct mail or email results than the mailing list.

The fundamental strategy to list selection is list segmentation.

The major list segments are:

The customer file

The inquiry file

The prospect file

When projecting your results for direct mail advertising, the smallest list and most responsive list is your file of active and past customers. The next most responsive are individuals on your house file who have inquired about your services but have not yet bought any of your products.

The lowest responding file are the prospect names your rent from list compilers such as InfoUSA, US Data Corporation, Experian, ZoomInfo, Hoovers, D&B and hundreds of resellers of these with special enhancements to compiler data.

Other than the product itself, no single part in your direct response mail/email mix strategy comes close to rivaling the importance of the mailing list. If you go to poorly selected prospect names consisting of individuals who do not need your product, can’t afford it or care little about it, then your best offer or creative execution will not make the program successful.

Recommendation #1 — Select a good list broker

For customer acquisition mail in both B2B and B2C, find and use a knowledgeable list broker. Your broker does not represent one compiler or reseller, but accesses lists from hundreds, if not thousands of available mailing lists.

Unlike a representative from a single compiler, your broker does the necessary research and mailing list targeting to make sure you rent the best available names on the market. Such individuals make their money through a markup on the list, a commission from the list owner, or both.

You cannot get too much help in this area. And the payoff is huge regardless of the size of your promotions.

Recommendation #2 — Consider response and specialty lists

When referring to compiled lists, the names are collected from phone records, credit files, publicly available names from voter registration and driver’s license files. The information on these files contain demographic data such as ages, home ownership, number of children in the household and so on. They do not contain interest or behavior characteristics that allow more sophisticated selection criteria.

Response lists the other hand, refer to the other major category of lists where the individuals have proven their interest and buying style to match your product and selling process.

Due to their proprietary nature and ability to increase response over compiled names, such lists cost three to five times as much as quality compiled lists.

The major drawback to renting response lists is the relatively small number of names when compared to compiled lists. As an example, if your product requires deep geographic concentration in certain cities or counties, then the expansion capability of compiled lists may trump the higher response rates available from response lists.

Response lists include the names of individuals who have completed a questionnaire indicating their areas of interest, completed a sweepstakes application or purchased magazine subscriptions.

In the end, compilers and list specialty houses merge information from multiple sources to create massive databases with enhanced names. They merge individuals’ information from many sources to come up with a unique databases in an effort to allow you to target your best prospects.

One of the most potent predictors of direct response campaigns is to go after individuals who have a buying history of responding to similar direct response offers using the same medium. For example, if you are offering a collectable item by mail, then try to rent response lists that have made offers by mail and sell collectables.

Selecting the most recent respondents who bought costs more. That is because they respond at a higher rate than those names with low frequency and older purchases.

There are many variables to selecting lists for any direct response campaign. This requires skill, experience and a lot of work. That is why picking a good list broker who creates list plans every day increases the odds for a successful test and rollout campaign.

Response lists are available from catalogers, retailers, mail order companies, ecommerce companies or any company that sells their products off-the-page in any medium to either consumers or business-based buyers. These companies keep complete records on their customers. These files usually have marketing information such as products bought, purchase amount, dates bought, how they were purchased and what offers their customers responded to.

One thing to know is that response list owners and agents will need to approve a sample of your mailer before renting their lists. They will also want to know your projected drop dates, so they do not compete with their mailings or burn out their names.

Recommendation #3 — Be aware of the greater complexity of B2B Mailing Lists

Be careful with B2B names. The list compilations and response lists for B2B are much more involved than consumer lists requiring many hours to select response factors like SIC codes, titles within the organization, buying decision makers versus buying influencers, corporate versus local offices ad infinitum.

Business lists grow more quickly out of date than residential files because people in organizations move continually as their roles change within or outside the organization. For this reason, many B2B marketers address their mailings and emails to functional titles rather than actual names for better response rates if their mailings go to midlevel staff. Another reason for addressing by title is that B2B compilers tend to not know the names of employees below C-level roles.

It’s best to test title versus actual name and title just as you would any other major list or creative variation.

With business customers, it is best to address communications to them by name, if available, to let them know that the sender knows who they are and recognizes them as a potential customer. This same recommendation applies to BtoC mailings and email.

Just as with residential names, there are a number of high quality B2B response names on the market. Always consider these names — especially if your market includes multiple states and whole countries.

Recommendation # 4 — Do not over or under mail your customer names

When going from acquisition to retention (or customer) mailings, be sure not to burn out your best performing customer segments. That particularly applies to email. Use every available segmentation tool such as Recency/Frequency/Monetary (RFM) selections, regression analysis, modeling as well as response list compilers like Epsilon to improve relevancy and ultimately, response rates.

A large number of companies, however, tend to not contact their customers on a regular basis. Both prospects, customers and inquirers will tolerate more contacts from companies as long as the messaging is relevant to their needs.

The frequency of mail and email to any list requires ongoing testing and evaluation. The frequencies vary from company to company. Fundraisers will mail their best donors as much as 24 times a year. some companies, typical mail to their customer 8 to 10 times a year.

Email is cheap when compared to direct mail. So, mail more and email less is the motto of the day. I recommend that companies mail as often as they can while there are still making money. For email, use the same concept but more than 24 times a year for most companies is the maximum email frequency I would recommend. Otherwise your emails may end up in the spam folder.

Be alert to how much mail and email your customers receive from you. Insist that communications lead to sales and have information that is relevant to each recipient. Don’t waste the customer's time with items that do not affect them directly.

When you select names --- especially from your house file --- look at how often you plan to mail and email to them over a one-year period. Otherwise, you will over mail or under mail to large segments of your available names.

Recommendation #5 — Treat your house list inquiry names like gold

When making selections from your house list, your databases consist of customers who have bought from you in the past. But your internal list should also include inquiry names that came from your promotions. These respondents have not yet spent money for your products or services but have inquired about your products somewhere down the line. Such inquiry names will out-pull the best rental lists available on the market.

Inquiry names are the most neglected names for both B2B and B@C mailers and emailers. Firms do not always save these valuables names for future promotions. This wastes a significant source of future sales and new customers.

If inquiries are proven as unqualified for your services or offers, then save them in a no-mail file so you don’t waste money promoting to them in the future.

Recent inquiry names respond better than any other list segment you have except for your customer names.

Recommendation #6 — Invest in list testing to grow your business

In terms of prioritizing your list selections to fit your available budget and immediate return on investment, mail first to your customers, secondly to your inquirers, thirdly to rented response lists, and finally to external lists.

After all, if you cannot sell new or existing products from the same product categories you sold to past customers, then it is doubtful that any rented lists will do better. So, use the funds earned from your best names (such as past customers) to fund your new customer acquisition efforts.

Certainly, you will want to focus continually on expanding your circulation database with successful list testing. That is why compiled lists, though usually the least responsive of the family of available lists, are so critical in your testing. Once you find a way to select successful compiled lists, your rollout universe expands to the maximum and your cost for rented names drops dramatically.

The need to expand your roll out universe combined with escalating list rental costs make ongoing list testing essential. And maintaining your existing customer file size requires ongoing expansion to replace the customers you lose through attrition. So, invest in list testing just as you do the offer, the product, channel and pricing.

You should go beyond compiled list to the smaller response files discussed earlier. Any of them could mean three to four times or more the direct response results you get from compiled list.

Find your list broker and let this professional take you to a new level of lead generation marketing.

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Here’s the answer to the question, “What does DMCG do?”

-Turnkey direct mail campaign planning and implementation.

-Test strategy development for largest rollout potential.

-Multi-media campaign planning and implementation for lead generation

programs.

-List research and database building.

-Direct mail and email creative development.

-Back-end sales analyses..