In direct Mail marketing, that old adage, "the more things change the more they stay the same", does not always apply. As most of you know, starting November 23 the new move update regulations go into effect. Same old headache for the USPS, stacks and stacks of UAA(Undeliverable As Addressed) mail, but now they are counting on some sweeping changes to reduce that migraine to a mild aggravation.

Okay, here's the technical lowdown, after Nov 23 rd, all First-Class Mailings at automated and presort rates, and now all Standard Mailings will require some form of move update qualification within 95 days of the day of mailing. There are a number of approved methods but the NCOA^Link™, (National Change of Address) provides the most comprehensive solution. Your mailing list will run first through the CASS™/DPV™ with LACS^Link™ process to standardize the addresses, provide the bar code information and assign each address with a deliverability grade. The second step provides a change of address for any individual, family or business that has moved and filed a COA form with the USPS over the last 48 months http://www.listcleanup.com/content/NCOA_Link_move48.aspx . There’s also an 18 month option, that will also move update qualify the list.

Okay, returning to the headache. The USPS has hopefully relieved some of their pain, but now many in the mailing business are starting to feel more than a little discomfort, trying to wrap their brains around the regulations, the costs, the PAF forms that are required, explaining these new requirements to their Standard mailers, managing the time required, and a host of issues.. Well at the risk of extending this whole headache analogy too far, Listcleanup.com can be your aspirin or Tylenol, depending on how much pain you may be in at the moment.

We been helping people migrate through NCOA^Link™, and move update qualifications since the whole thing started back in 1997. For more than a decade, over 2,500 companies have trusted us for timely, efficient and cost-effective solutions. Along the way, we've added other services, tailored to provide our direct marketing clients an edge over their competition. Yet through it all, there are a few core values that have never wavered; a focus on customer service, sales and IT support, a seamless online order process that insures reliable, timely delivery of your orders and flexible pricing .

As my colleague, Bill Brennan, mentioned in a recent post, should you take on an in-house solution given all variables that will come into play, before speaking with us first? We have the answers, we can make this whole move update “challenge” simple, easy, and even better, we can show you how to earn revenue providing this service to your client.

Why bother with the headache, when you can call us.

Today the focus was on the move update changes, just around the corner. Down the road we’ll look into the range of data management services we can provide, all pointed in the same direction, what can we do to improve your direct mail bottom line ?

http://www.listcleanup.com/content/Default.aspx

October the 21st Conclusive Marketing (www.conclusivemarketing.com) and MicroStrategy (www.microstrategy.com) released a press release announcing how Conclusive is adopting MicroStrategy technology to put Business Intelligence ("BI") right in the middle of our services. 

To the casual onlooker that might look like a ho-hum technology announcement, but in the marketing services arena this is a meaningful signal how marketing paradigms are shifting from simply executing communications to continuously searching for improved ROI by analyzing programs.  Its not enough to outfit tomorrow's marketer to simply perform direct marketing, they need to be properly tooled to view the macro and micro condition of their programs.  We believe in a highly automated data-driven future and Conclusive is seriously investing to ensure that our clients can transition into this paradigm with us. 

Without recent tools like MicroStrategy, firms' analyzing marketing programs have all too often relied on one or two staff who know both how to think about marketing analysis and also how to engineer the data for analysis.   With MicroStrategy, however, the data engineering is out of the way and all the analysts can actually focus on, (catch this!) analysis.  The MicroStrategy report and charting options are attractive and easy to use by anyone in the marketing department.   And the impact can be dramatic. 



One client, an agency for a major automotive OEM, reports that it now takes them 10 minutes to examine data that used to take 8-10 hours to digest.  More of their team members can contribute to the analytic process, as the task of doing so is now focused on viewing, as opposed to managing the data.  And with the time savings, the resources now have the "luxury" of digging deeper into analysis.

So there is now definitely some BI in the middle of Conclusive Marketing.  MicroStrategy could be our middle name.
 

At the DMA Conference in Las Vegas this week, I heard a common question.  "Why set up a Marketing Database?  We have a CRM platform."  Then I begin to ask the questions.  How long does it take to get data from IT to complete the data processing for your marketing campaigns?  How difficult is it to utilize business intelligence to develop campaign triggers or report on marketing results? Where does the marketing information reside in your CRM platform?  I often hear "by the time our business intelligence group recieves data and completes data analysis the relevance of the marketing opportunity discovered by our market research has passed!"  The reason this is happening is simple;  you have data management occuring at the enterprise level in order to run the back-end of the business, not specifically marketing data that captures the essence of the customer interaction required for integrated marketing activities. We service several Fortune 500 clients, those with a true marketing database are able to successfully execute campaign management, triggered marketing and deliver great marketing ROI.  Those of our clients that rely on enterprise level information management are only able to manage campaigns as "one-offs,"  the results often a fraction of those with a true marketing database.  It is a simple question with a simpler answer, in order to optimize marketing ROI you must have a database built for that purpose.

What times we live in  ... the cover title of DIRECT magazine proclaims "Mad Money" in August 2008 and "What Downturn?" in September 2008 as Wall Street registers its first dip below 10,000 in years just a week before the October 2008 DMA Conference.

How is it that those headlines could co-mingle?  Were the circumstances related to the DIRECT articles simply darting in and out to be replaced by an economy that arrived as quick as the season's first turn in weather?  Was data on the Dow's decline misleading?  Or were there people at Wall Street or DIRECT that simply missed the story?

As practictioners of direct marketing, and particularly as experts with data analysis, we are much better positioned than our public to make sense of these paradoxical times.  We recognize that both our headlines are true -- the economic downturn is striking, but there is still room for success if we can cull through data and identify that event, that moment in time, that each consumer returns to purchase products.  

Of course our margin for error is getting smaller - a lot smaller. To be prepared for precision marketing, we need to sharpen our data management - search for new sources, perform thorough data processing to cleanse it more thoroughly, incorporate data analysis services to elevate our knowledge about consumers and generally do all we can to optimize our marketing information.

Recognizing the challenge suggested by today's headlines, the vital ingredient is to conduct integrated marketing, to link all that data management to the point in time that clean data is relevant -- the seemingly narrower and narrowing point in time that each consumers' purchasing window is actually open.  And that, dear reader, implies that marketing must evolve to event driven marketing solutions. 

Mad Money will be on display at the DMA next week when the convention center opens its Starbucks and $4 coffee stands right in front of marketers, marketers who are staring this economy straight in the face.  But the product will be right, the prospects will be thirsty and the timing will be right.  Marketers will smell the coffee and buy that event driven solution.  Now, we just need to fix that Dow ...

With marketing dollars declining, it is more important than ever to communicate to customers and prospects most likely to purchase.  Your customer base is your best resource for generating additional revenue and determining your best possible prospects.  In order to utilize this valuable resource, your must learn as much as possible about them.

 

Third party data providers can determine important facts about your customers by simply matching your database of names and addresses to theirs.  Types of information available are age, income, education, marital status, presence of children, credit score, and on and on.  Once these details are known, data analysis can be used to determine what a customer of your product “looks like”.  This data intelligence will enable you to create a customer profile for each product in your portfolio. 

 

Customer profiles create the ability of a company to increase sales in a couple of ways.  The first way is to cross-sell to current customers.  By using the profiles of customers currently purchasing certain combinations of products in your portfolio you can determine the next best product to sell to each customer.  Secondly, these profiles also give you guidelines for acquiring prospects.  Third party data providers can provide prospect lists based on detailed demographics that you determine through the customer profiling.  In essence you are determining the next product to sell your customers and the next prospect to sell your product.  Follow up with lead management processes such as direct mail marketing and both approaches translate into additional revenue.

I, for one, am thrilled with the USPS change in regulations on NCOA requirements for Standard Mail and the frequency of Move Update requirements for First Class mail.  In my world of database marketing, I rely on quality data management as the core to delivering marketing ROI to my clients.  Their message sometimes finds itself in the trash beside a piece of true "junk mail" due to other database marketers refusal to adhere to data quality management best practices.  Recently my mail box included mail addressed to a former Tennessee Titan player who built my house 11 years ago and then was traded and moved the next year!  The Doctor who bought the house from the Titan also has mail from his former life, he has been gone for 7 years!  Not only will these new regulations save the USPS untold millions of dollars in UAA mail, the by product should include better results for my client's direct mail marketing programs and less trash in our landfills.  As Sarah Palin would say, that is just a great win for all of us!

Marketing has undergone a paradigm shift. New tools, new technologies, new approaches and new data have opened marketers’ eyes that there is indeed a cause and effect and predictability in customer’s actions. It is discernable in the marketing data, as Davenport notes: “Most business functions, even those, like marketing, that have historically depended on art rather than science—can be improved with sophisticated quantitative techniques.” ¹ In a paper, “CRM from ‘art to science’” Jackson² sets forth a new framework for treating marketing as a science:

Early research and methods concerning customer relationship work often focus on more intuitive approaches to customer management. Many of the initial theories, such as one to one marketing and value-based management, were less analytical in their approach. Likewise, too often companies that have implemented customer relationship management (CRM) systems have done so with an unstructured approach (art) as opposed to a structured and by-the-numbers approach (science).

 
Historically, marketing is known as a social science, rooted in psychology and sociology. However, as has been recently discovered, customer behavior is actually quite quantitatively predictive:

Marketing…has always been tough to quantify because it is rooted in psychology. But now consumer products companies can hone their market research using multiattribute utility theory–a tool for understanding and predicting consumer behaviors and decisions. Similarly, the advertising industry is adopting econometricsstatistical techniques for measuring the lift provided by different ads and promotions over time.³

It is only recently that the marketers have discovered new data mining methods which are proving to be highly robust and reliable. “Over the last 10 years, a paradigm shift has occurred in the statistical analysis of marketing data.” ⁴

At the same time, consumers themselves have undergone their own paradigm shift…from being marketed to, to taking control of what messages they hear, when they hear them and what channels of communication that companies are able to use to communicate with them.“ The consumer is deluged with messages. The average consumer sees about one million marketing messages a year-about 3,000 a day. One trip to the supermarket alone can expose you to more than 10,000 marketing messages!” ⁵Customers will no longer tolerate this mass media or mass customization approach. Customers are individuals, not transactions or demographics. "Customers are demanding that marketers communicate when and how it is convenient for them. Underlying right-time marketing are analytic and predictive capabilities that determine the optimal interaction strategies, automation and incorporation of repeatable best practices” ⁶

One of the key shifts that has occurred is the need to treat customers as individuals and not as segments or clusters: “Successful direct marketing initiatives require firms to predict the behavior of specific individuals.” ⁷

Today’s managers are very interested in predicting the future purchasing patterns of their customers. Faced with a database containing information on the frequency and timing of transactions for a list of customers, it is natural to try to make forecasts about future purchasing.These projections often range from aggregate sales trajectories (e.g., for the next 52 weeks), to individual-level conditional expectations (i.e., the best guess about a particular customer's future purchasing, given information about his past behavior). There is a great deal of interest, among marketing practitioners and academics alike, in developing models to accomplish these tasks.

A new approach to customer data analysis is needed. Customers must be analyzed and treated as individuals.Today it is possible to analyze individual customer behavior and act on it with custom marketing materials, with the right message at the right time. It is intuitively obvious: “The secret to achieving a good marketing ROI is simple: Give customers more of what they truly want and less of what they don’t.”⁹With marketing data analytics and business intelligence, we can figure out what this is and optimize for it.

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¹ Thomas H. Davenport, "Competing on Analytics," Harvard Business Review 84, no. 1 (2006).

² Tyrone W. Jackson, "CRM: From 'Art to Science'," Journal of Database Marketing & Customer Strategy Management 13, no. 1 (2005).

³ Davenport, "Competing on Analytics."

⁴ Greg M. Allenby, David G. Bakken, and Peter E. Rossi, "The HB Revolution," Marketing Research 16, no. 2 (2004).

⁵ Seth Godin, Permission Marketing (New York: Simon & Schuster, 1999).

⁶Dan Goldstein and Yuchun Lee, "The Rise of Right-Time Marketing," Journal of Database Marketing & Customer Strategy Management 12, no. 3 (2005).

⁷ Greg M. Allenby, Robert P. Leone, and Lichung Jen, "A Dynamic Model of Purchase Timing with Application to Direct Marketing," Journal of the American Statistical Association 94, no. 336 (1999).

⁸ Peter S. Fader, Bruce G. S. Hardie, and Ka Lok Lee, ""Counting Your Customers" The Easy Way: An Alternative to the Pareto/NBD Model," Marketing Science 24, no. 2 (2005).

⁹ V. Kumar, Rajkumar Venkatesan, and Werner Reinartz, "Knowing What to Sell, When, and to Whom," Harvard Business Review 84, no. 3 (2006

Not only is fly-fishing on a beautiful, cold water stream relaxing, it is the challenge of imitating nature in it's most pure form that makes me feel alive. Stealthily entering the water you envision the fish in their gin clear world, facing upstream, patiently waiting for the almost invisible aquatic insect to catch their attention. The reaction so sudden, yet so cautious, if you blink you have missed the moment; the opportunity. Imitating the natural environment with a perfect presentation, tremendous focus and the willingness to try variations; different flies, angles, tippets and times of day all make the sport so rewarding when finally you feel the fish on your line. You have succeeded despite the noise of others enjoying the river in their own way, splashing and thrashing, throwing rocks, hitting canoes with paddles...sometimes seeming like they do not care that they are creating havoc for the river residents.

 

Producing Marketing ROI holds the same challenge for me, both the art and the science of direct marketing must combine perfectly to create the opportunity to generate leads, acquire and retain business and ultimately ROI. The marketer, like the fly-fisherman, is faced with environmental factors that can determine the outcome despite a perfect presentation. Customers can be spooked by the economy, by their unique personal situation or even by disruptive competitive practices that create noise that mask the well-designed and timed marketing communication, to the perfect database, you have so carefully delivered.

 

So how can the marketer evolve campaigns to create a higher probability of success? Just like in fishing, one must discover the most fertile waters (data and business intelligence) and then deliver a consistent, relevant and timely message that cuts through the noise and restores the natural order. The marketer must enjoy the refinement of all aspects of the marketing continuum in order to be successful. The variables and iterations are endless; therefore the supporting tools and solutions must be just as robust. Think of Conclusive Marketing as your "Marketing Outfitter," providing unique marketing solutions that allow you to consistently capture the attention of the finicky consumer.