Print-Plus : Climbing Out of the Foxhole
How to get back into catalog prospecting mode
March 2010 By Stephen R. Lett
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The past year was extremely difficult for catalog companies, and many firms elected to mail deeper to their housefiles instead of prospecting for new buyers. Catalogers, however, need to start prospecting again. File counts can’t continue to decrease, or sales will continue to decline. Catalogers should now cautiously increase prospecting levels to build for the future. As we emerge from the recession, companies that continue marketing and mining for new buyers will be in much better position to take advantage of the rebound.
There’s a cost associated with acquiring new buyers, however. How much you’re willing to pay depends on what you can spend, how fast you want to grow and the lifetime values of the buyers acquired.
As you increase prospecting, don’t pull out of any cooperative database in favor of another. When catalogers decide which cooperative databases to keep using and which to drop, they use many factors. But how does this affect models and prospecting overall within the cooperative databases?
The problem is that not every cataloger pulls out of the same databases. Even within the same product category, certain co-ops work well for some catalogers but not others. But the names shared by all are still necessary for an effective model that supplies the best prospects. In essence, on top of everyone’s 12-month buyer counts decreasing and straight list rentals performing worse, co-op databases also are being weakened by companies that withdraw from them. To keep prospect names at their highest levels, all catalogers should stay in the co-ops they’ve been using.
Outside List Performance
Maximize outside list performance by increasing response rate, average order size or both. Response rate yields more new buyers, I find, so it grows your 12-month buyer file faster.
Select outside lists based on recency of last purchase. Maximize rollouts before testing new lists and double the usage each time, assuming there are enough names in the list universe. After maximizing list continuations, fill in with the lists you want to test. Looking for buyers who’ve purchased multiple times recently is another good way to improve response rates. Use marginal list optimization to improve performance.
Don’t Dedupe Duplicates
When prospecting in back-to-back mailings four weeks to six weeks apart, should previously used names from an outside list or co-op be eliminated? There will be duplicate names, but I don’t recommend omitting previous usage. Here’s why:
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