Direct Mail and the Dynamics of Response
Part II: The Offer - Key to Response
Most marketers begin with the seemingly logical assumption that they are selling a product (or service) and that's what they have to describe in order to sell. Well, yes. And no.
Remember that direct mail is an interactive medium. In psychological terms, it is a stimulus/response transaction. We have to get a response -- not just agreement. You could describe your product in glowing terms in a ten-page letter, illustrate it up one side and down the other in an award-winning brochure, and if all you get is "Gee, that's a great idea. When's my next meeting?," your effort has failed.
In order to get our prospect to act, we must provide a mechanism for action. A stimulus. AND THE STIMULUS ISN'T THE PRODUCT - IT'S THE OFFER!
When some folks think of the offer, they assume it means price. The offer inlcudes the price, but it ismuch more than thatr. The offer consists of everything that impacts the value or perceived value of the product or service and everything that impacts the process of getting it from the seller to the buyer.
It's the "deal." The quid pro quo. I'll give you a free trial; a demo; a free issue; a free report; a video; a calculator; a sweepstakes prize (if you win); a special, limited-time price - if you'll complete the enclosed order form or tuck the token in the slot and mail it today in the postpaid envelope provided, or call the toll free number. No risk, no obligation, of course.
Charge it to your credit card, bill it to your company, enclose your check with complete assurance that you'll get every nickel back if you're not satisfied.
The offer may also include a premium. The premium should be something tangible. An item designed for instant gratification, together with the process by which the prospect can receive it now...or promptly upon payment for his/her order.
In lead generation, information related to the product (a Special Report, a series of Case Studies, a free cost-benefit analysis, an industry study or survey, a White Paper, etc.) is often a good premium.
When selling directly, a special gift such as a watch or tote bag, or the promise of a big sweepstakes payout, can add involvement and boost response.
In both cases a stated time limit will often improve response, as will a yes/no option on the order form.
Premiums can make or break a promotion. They should be extensively tested, but in my experience, they rarely are.
Taken together, it is the offer that you stick in the window. It is the offer that you "sell" to your prospect as a quick and easy, guaranteed way to explore for her/himself the various claims you've made for the product. Or, in lead generation, as a way of indicating interest in a particular product or service category.
This assumes, however, that you've done your homework on your lists, and you're offering your prospect something he or she wants.
True "junk mail" is an offer sent to the wrong person.
Inviting the prospect to send for "more information," which we often see in business-to-business ads, is not an offer. At best, it's a weak offer because it's too open-ended and it only promises another sales pitch. There's nothing tangible for the prospect to want. Nothing for her/him to visualize like a special report with a descriptive title that promises some specific type of related information.
An offer is a form of neutral turf. It's a place where the prospect and the marketer can meet without obligation and where the prospect feels he or she can obtain some sort of value, usually in the form of information. Information that's altruistic in nature. Facts, tips, data that will be useful to him/her, independent of the product.
Make Me An Offer - But Guarantee It!
Whatever your offer, a guarantee is essential. Contrary to what some entrepreneurial types think, offering a guarantee in no way diminishes or denigrates your product. The guarantee has nothing to do with the product. Rather it speaks to you and your company and the honest, fair and open manner in which you do business. It's designed to build trust and mitigate risk.
Further, most direct marketers have found that they rarely get ripped off by guarantees. Most people are honest, and most business people especially are just too busy, too distracted, or too professional to spend time ripping off a mailer. Sure it happens, but it's not a major consideration.
In stating your guarantee, "Money back if not satisfied" is unnecessarily negative. "Try it for 30 days without risk or obligation" is the same thing put more positively. And longer guarantees, 60 days, 90 days or life-of-the-product, usually pull better than 15 or 30 days. The recipient often becomes acclimated to the product during the longer trial period, and you can get good old human inertia working for you, instead of against you.
The Quantity/Quality Ratio
One dynamic you'll want to consider in framing your offer is the universal truth that you can't have it both ways. The higher the quantity (volume) of response, the lower will be the quality (interest level) of the respondents.
There are "hard" offers and "soft" offers, and several levels in between. The harder the offer, the more highly qualified your prospects will be, but there will be fewer of them. Vice versa with a soft offer.
Give away six free introductory issues of a newsletter, for example (soft), and those subscribers will renew at lower rates than those who simply entered their subscription in response to a straight, no-risk offer. And those who paid up front will renew at higher percentages than those who asked to be billed.
Magazine subscribers who are given free premiums or who buy into mega-sweepstakes will be less likely, on average, to renew their subscriptions without the same or similar inducements.
A free demo or video will attract more "tire kickers" than a paid one, even if it's just a few dollars. But it will attract more prospects in the aggregate. In general, the more difficult you make it for your prospect to buy - the more hoops you make him/her jump through -- the more highly qualified he/she will be. That should translate into higher response rates downstream.
Under FTC rules, you can't say that something is "free" if the prospect has to send payment to obtain it - or without some clear statement of the deal in close proximity to the word "free." For example, "Yours FREE with offer inside" implies that the prospect has to agree to something else in order to get the "free" gift.
Thus a "Free Trial" must include a "bill me" option. No payment up front. A "No-Risk" or "Risk-Free" Trial, however, can require payment with a refund option clearly stated.
A free trial (no payment required up front), may prompt more returns than with cash on the barrelhead, but you should realize sufficiently higher gross sales to justify the offer. Net sales will depend on a variety of factors including list quality, price, product positioning and more. Testing here is essential to determine the most profitable option. (In positioning your product, never make a promise that it can't keep. You'll end up paying for it on the back end, both in immediate returns and lost additional business.)
A common offer mistake, in my opinion, is to offer a reduced rate on a second, usually related product as an inducement to purchase the primary product. For one thing, it dilutes the sell. Now the prospect has to weigh the merits of two products, not one. However, the second product almost never receives the sales push that the primary product gets. The relationship may be clear to you, but it's rarely that clear to the prospect. To him or her, you're simply trying to sell two products instead of one. This kind of double offer often provides the prospect with an excuse to put off the purchase decision until "later." Also known as "fuggeddaboudit"!
If experience shows that you are likely to convert a high percentage of respondents into customers, then open wide the offer door with "FREE" product trials, free gifts, etc.
In most cases -- and this applies to direct selling as well as to lead generation -- you want buyers who are well qualified, involved, active. Customers who will purchase additional products and services from you when added to your marketing database. So be sure to crank those considerations into your offers.
