LOOMIS | DALLAS AD AGENCY | DATABASE MARKETING | CUSTOMER ACQUISITION

What’s the best way to acquire customers?  It’s a trick question.  There is no single best way to acquire customers.  Store promotions, direct mail, print, broadcast all work.  But let’s start with direct mail.

PART ONE OF FOUR PART SERIES ON DATABASE MARKETING AND CUSTOMER ACQUISITION

 
First, it’s important to understand the direct response model in its simplest form.  Customer solicitations are proffered through one or more forms of media. The customer responds by taking a desired action – calling, visiting a store or website. At point of contact the customer information is captured and put into a customer database.  This database comprises our responders.

Let’s talk direct mail and direct mail campaigns.

So where do we begin?  With a list, of course. 

There are more than 40,000 direct response / direct mail lists of consumers and businesses available for lease.  Direct response / direct mail list brokers usually charge between $50 and $250 per thousand for a single use.  These lists are seeded by the list houses so they can detect multiple uses.  There are two types of direct response / direct mail lists:  response lists and compiled lists.  Response lists always work better for database marketing and customer acquisition efforts because more than half of US consumers never buy anything by mail.  For a large database marketing effort, say 2 million or more names, you can rent 200 different lists.  Rent 3 million names because you will find a minimum of 25% duplication.

How are direct mail lists compiled for database marketing and customer acquisition campaigns?

Marketers and ad agencies plan database marketing campaigns for the purpose of customer acquisition. List brokers supply names and the major service bureaus process the names.  Next, a direct mail shop prints the names on letters and cards, and they are sent.

One of the key steps in the list building process is the merge purge.  Say you have 350 lists with 3.5 million names.  That database needs to be run through a formatting process that includes coding accuracy support, delivery point validation, address element correction, development of a delivery sequence file and locatable address conversion. The entire process results in a dynamic change of address.  At this point in the direct mail list building process all duplicates are eliminated through a suppression process and the outgoing mail file is sent to the direct mail house.  This rigorous processing phase saves a great deal of money by reducing overall costs and improving direct mail response rates.

In the next posting the following topics will be covered:

• Direct response rules
• Response rates
• Acquiring retail customers
• SPAM
• Principles behind modeling

The LOOMIS Agency is an award-winning Dallas ad agency with significant expertise in database marketing and all forms of direct response.  The ad agency is also known for its award winning television, print, interactive, outdoor and promotional work.  The LOOMIS Agency was founded in 1984. For more information on The LOOMIS Agency and the services it provides contact company president, Mike Sullivan at (972) 331-7000.

For information on The LOOMIS Agency's sister company, Luminous Sound, please visit www.luminoussound.com.

For more information visit the Direct Marketing Association.