How to sell successfully to consumers using direct marketing

Direct marketing is about using different media to sell directly to customers without having to meet them in person or use a reseller. It is also one of the most exciting, powerful and instant ways of marketing products and services, whether you are sending people a mail shot, appealing via a newspaper advertisement or your website, or cold calling on the telephone.

Almost anyone can incorporate direct marketing into their business. You might be starting a new business, adding another sales arm to an existing business, wanting to work from home, part time, or even just running a fledgling enterprise from the spare room. With direct marketing, all you need is a good product or service, a well thought-out sales proposition and a bit of organisation.

For that reason, direct marketing also allows you the opportunity of operating without most of the hassles and costs of running a shop or large office. In addition, there is the potential to reach a worldwide audience right from the start.

Direct marketing is unique in its ability to reach the potential customer. It can send a message that is focused, measured, intimate and which literally penetrates the home or office of the intended target without you ever meeting that person face to face.

This guide focuses on attracting consumer customers by mail or through advertisements.

Getting the offer right

The elements that make up your sales offer are:

• the product,
• the price,
• the benefits,
• the fulfilment mechanism,
• the reassurance.

Your success depends on the way you get all these concepts across.

Regardless of whether you are writing a mail shot or a newspaper advertisement, and of how wonderful your product is, you will fail if you don’t get the offer right. This means you have to abide by the golden rules of copywriting, which are:

• Attention 70% of the success of your offer lies in the headline – grab the reader and keep them reading.
• Interest Keep your copy punchy and to the point – bore the reader and you deserve to lose them.
• Desire Essentially self-interest. Keep telling the reader what’s in it for them.
• Action If you are going to lead the horse to water at least let it drink – make sure that you make it easy for readers to act on your offer by giving them the information they need to contact you and buy.

Reassurance wins

Two of the main things that prevent people buying from direct mail or adverts are fear and uncertainty. Is what you’re offering right for them? Can it be as good as you say or is it a con or a scam? The answer is to offer a full money-back guarantee. If they feel they have nothing to lose, people are far more likely to respond.

Your copy checklist summary

Always cover the following when writing any form of sales literature:

• Headline, body copy, response mechanism.
• AIDA – attention, interest, desire, action.
• Benefits – what’s in it for the customer.
• Honesty – remember your legal obligations (see below).
• Style – keep it simple and make every word work for its living.
• Ease of response – make it easy for the customer to buy from you.
• Call to action – try to give a reason to act today rather than putting it off until tomorrow… and then forgetting.

Design and printing

You can, of course, hire an agency to write and produce your advertisements or mail shots. But you can choose to do it yourself. The golden rules of design and printing are simplicity and clarity. You can even produce small mail shots easily on good-quality home office equipment. Alternatively, use a printer, who can offer higher quality, colour and more flexible formats, and handle larger runs of several thousand more cost-effectively.

When producing advertising material for publications, check to see what format the publisher accepts and how they want you to deliver your artwork. If you are producing an advertisement for a national newspaper, get it professionally typeset – although some papers will even do the setting for you as part of the ad price. Newspapers will normally prefer electronic files – the advertising department will be able to tell you the technical requirements.

Your audience

Even if you get the offer right, you will still fail if you reach out to the wrong people.

So, if you are selling off the page, make sure you place advertisements in the right newspapers for your audience – are they readers of The Times or of News of the World? If you are planning mail shots, try to get as precise a profile as you can of your target customer. Then match their profile with that of the huge range of mailing lists available to rent. Later, when you have customers, you can survey them to refine your targeting.

Take every opportunity to understand and identify your customers, and how they can be reached cost-effectively. Be scrupulous about getting to know your customers and try to get inside their psyche.

Buying space

When it comes to buying advertising space, call the newspaper direct and ask for a copy of the rate card so you know your starting point. Then call back and negotiate hard, particularly near their copy date when they are often desperate to fill space. The more business you do with them, the better rates you will command.

Once you’ve agreed a space, check everything, especially when and where your advertisement is going to be placed. Make sure it is in the right part of the paper – an advertisement for a cookery book in The Sun’s sports section is unlikely to sell well.

Choosing lists

In direct mail, by far the most decisive factor is the quality of the list you use. If you are renting one, it is vital to check it is focused on your market, that the names are recent (no more than one year old), the contact details are accurate and, ideally, that they are direct mail responsive (have they bought by direct mail before?).

To find the right mailing lists, talk to other people in your field and find out whom they recommend. Or contact the Direct Marketing Association for names of list brokers.

It’s always worth paying more for a really good list. A typical mail shot might cost £500 to £1,000 per thousand including design, print, postage and names. Typical response rates might be between 0.25% and 2% for a low-priced list. To gain a better response rate, you will have to pay more for a more precisely defined list. Remember that prices for renting mailing lists are also negotiable – ask to test the list at a favourable rate and get a discount for repeat rentals over a period.

When you are ready to mail out, investigate bulk mailing discounts at Royal Mail, and always double and triple check that your advertisements or mail shot did actually go out on the day specified – never take someone’s word for it.

The legal angles

These days consumers are well protected by law.

• If you are selling ‘off the page’, i.e. through a national newspaper advertisement, you have to be a member of the Mail Order Protection Scheme (MOPS).
• If you make claims in your literature that are untrue, the Advertising Standards Authority has the power effectively to close down your operation.
• If you hold customer details, you have to comply with the Data Protection Act.
• You have to play fair regarding refunds and returns (see below).
• The public have access to their local Trading Standards Office, which has wide powers to investigate and prosecute you.

There are also numerous preference services that allow consumers to opt out of receiving direct marketing offerings. Penalties for contacting consumers who have registered with these can be severe – a £5,000 fine per call for breaches of the Telephone Preference Service, for example.

Preference services and legislation you should be aware of include:

• MPS – The Mailing Preference Service (MPS) is a data file of consumers who have registered their wish not to receive unsolicited advertising material by mail. It is a voluntary system.
• FPS – The Fax Preference Service allows consumers to opt-out of receiving unsolicited sales and marketing faxes at home. It is legally binding on marketers.
• TPS – The Telephone Preference Service is a sister service to FPS and enables individuals to register their objection to receiving direct marketing calls. Again, it is illegal to breach it.
• CTPS – A version of TPS for corporate subscribers.
• Electronic Communications Act – This outlaws direct marketing emails to individuals who have not opted into receiving them. It also requires marketers to ensure their identity is clearly disclosed in the email and to provide a working unsubscribe option with all communications. The regulations also apply to SMS / picture/video marketing.

How to fulfil an orderGetting a response is only ever half the battle – fulfilling the order quickly and accurately is the other half, regardless of whether you are offering a service or a product. The fastest way to alienate a customer is to sell on a big promise and then fail to deliver. If you are offering a mail order product, it’s important to have a fulfilment system in place from day one that will do the following:

• Sort orders – open all orders the day you receive them. Avoid backlogs.
• Produce a daily report sheet – keep a daily record of the source of your buyer, their address, the order value and description.
• Put this information onto computer and then generate an address label for dispatch.
• Dispatch the order within 48 hours of receiving it – gone are the days of allowing 28 days for delivery (except for some specific long lead items).
• Keep a tally of your daily stock level so that you are never caught with insufficient stock which, incidentally, is contrary to MOPS rules.
• Bank the money or process the credit card only after the product has been dispatched. This may seem risky, but in practice, few customers bounce cheques or use bad credit cards. If a large payment is involved, you can obtain approval from the issuing company before despatching the goods.
• Handle returns – some products will come back and it is important to be as swift giving a refund as you are about taking the money in the first place.

Refunds and returns

The Distance-Selling Directive gives buyers certain rights. Remote buyers have the right to cancel an order within seven days and you must make this clear to each customer in writing.

There are certain exceptions, which include holidays, perishable goods, and goods that were supplied to the customer’s specification, such as made-to-measure clothing, or which are personalised, such as stationery or business cards. To prevent piracy, tapes, CDs, videos and computer software are also excluded unless they are returned unopened.

If requested, you must provide a refund, whether the goods have been returned or not, within 30 days. There is no deadline for customers to return goods. You can charge for the cost of returning the goods but this must be made clear in writing at the time of purchase. Copies of the Distance Selling Directive are available from the Direct Marketing Association.

When to call in the professionals

If you are a smaller operation, it is entirely possible to fulfil your own orders from your office or home. Talk to your local Royal Mail sales office about bulk collection and franking.

As your business grows, though, it makes no sense whatsoever to do it yourself. Subcontract as soon as you risk becoming inefficient.

There is a large range of fulfilment houses that specialise in processing orders for different types of products or services. Some also have facilities to take phone orders, which is vital for advertising campaigns. A good fulfilment house will be able to offer much useful advice, so consult them early in the planning stages of your campaign.

You can find fulfilment houses easily in Yellow Pages or through the professional mail order associations, such as the Direct Marketing Association. However:

• Make sure you have total access to the money being banked on your behalf.
• Check how quickly they are despatching orders. 
• Monitor how your precious customer names are handled. In particular, you don’t want them being passed on to anyone else. You can check this easily by slipping in a fake name (called a ‘sleeper’) at a known address (say, your neighbour’s). Any other mail addressed to the fake name will soon tell you if someone is using your names without telling you or paying for the pleasure.

The cost of fulfilment

If the fulfilment house is handling everything from opening the orders to banking the monies plus producing a daily sales report sheet and despatching the goods, you should expect to pay about £2.00 per order plus postage depending upon the volume of business you are putting their way and the nature of the product.

Finding new customers

To run a growing and healthy business you need constantly to find new customers. Running advertisements and renting mailing lists are both perfectly effective ways of finding them, but thinking laterally can also pay dividends.

• Consider putting your inserts in with another company’s complementary product fulfilment – either pay an insert fee or just share the gross sales profit.
• Use PR in magazines, on the radio and, if possible, on the television to publicise your business. Always offer a free factsheet to readers, listeners or viewers, offering tips and advice as a way to capture contact details of potential customers.
• Offer free material to websites in return for publicity.

In other words, never miss an opportunity to tell the world about it – you never know who is listening.

Working your list

It’s easy to forget the profit potential of existing customers in your enthusiasm to find new leads. But remember that the real expense of identifying the customer has been covered, so any repeat sales will have a much higher profit margin. This, incidentally, is where good customer service starts to pay dividends.

One of the most effective ways to repeat sell is by putting an offer into the fulfilment of the very first item – this may seen strange, but it is an ideal time, when the customer is keen and enthusiastic, to sell again. Offers made this way generate an average 25% higher response rate than those sent at a later date.

Extending your product range

Don’t be complacent about selling one product or service successfully – to however many people – since it won’t sustain you forever. Look at offering variations on the theme or finding new items with a related interest. For example, one person used to sell vegetable seeds to lists of gardeners and she quickly realised that a giant pumpkin enthusiast could also be sold giant tomato seeds. Why? Because what got them excited was not growing pumpkins per se, but growing the biggest vegetable. So she promptly launched a giant vegetable catalogue, and found that most gardeners just bought the whole range without question.

The golden rules of direct mail

Whether you are offering a service or a product, the principles of selling successfully by direct marketing are the same:

• Study the market.
• Get the offer right.
• Make sure the legal and practical issues are all in place.
• Pay as much attention to fulfilment and delivery as to getting the business in the first place.
• Think laterally to increase the business.

Remember that in direct marketing your letter or advertisement is your shop window to the world.

Useful contacts

Committee of Advertising Practice

The advertising industry’s self-regulation committee, administered by the Advertising Standards Authority. Its website has a series of downloadable advertising codes.

W: http://www.cap.org.uk/

Mail Order Protection Scheme (MOPS)

MOPS acts as a guarantor for advertisers. It protects consumers buying by mail order if an advertiser covered by the scheme collapses. However, MOPS only covers cash-off-the-page advertising in national daily newspapers.

18a King Street,
Maidenhead,
SL6 1EF

T: 01628 641 930
F: 01628 637 112
W: www.mops.org.uk

The Office of the Information Commissioner

T: 01625-545 745
W: www.dataprotection.gov.uk

Royal Mail

The Royal Mail has a comprehensive section about direct mail on its website at www.royalmail.com/mailmarketing.

Lists

Lists and data sources, Ladson House Publishers.

T: 08700 629 299.

Consider obvious sources of lists, such as Yellow Pages and Thomson Local Directories. Contact the Direct Marketing Association for a directory of list brokers.

Direct Marketing Association

DMA House,
70 Margaret Street,
London
W1W 8SS

T: 020 7291 3300
F: 020 7323 4426
W: www.dma.org.uk