Quality, Not Quantity – The Importance of List Management

Friday, March 7th, 2008 RSS Feed | Trackback

I recently read an article called, Fairytale Ending, published in the March issue of Deliver® magazine that inspired me to expound upon the importance of list management in direct marketing campaigns. In summary, the article described the plight of a mail-order gourmet brownie company to effectively manage and grow their catalogue distribution lists. Because the majority of their business, or all of it, depends on responses to their catalogues, the company decided to expand their customer mailing list by acquiring multiple purchased lists from an agency. The rapid growth of their mailing list caused them to increase catalogue production and, as a consequence, increase costs associated with their direct marketing campaign. The tough part for this company, though, was that they didn’t see a correlating increase in response rates. After investing all this money, the responses were not sufficient enough to recuperate the growing cost of catalogue production, let alone producing any bump up in profit.

So, what went wrong? A lot of people assume that if you increase your marketing campaign’s reach, the ratio of responses should grow at the same rate. Statistically, this theory might be true if you’re talking about something like playing the lottery – the more you play, the more chances you have to win. Unfortunately, this rule doesn’t apply in direct marketing. Success isn’t necessarily dependent on quantity, but rather on quality of your marketing message and the relevancy of people that receive that message.

Proper list management is an incredibly important part of a successful and effective direct marketing campaign. The effort of reviewing and refining your mailing lists should be constant and should hold just as much importance as things like defining your marketing message or balancing your budget.

First and foremost, making sure your list is targeting the right consumer for your product or service should be a top priority in any direct marketing campaign. To ensure you’re getting as close to your target audience as possible, it’s always best to start with home-grown lists. Build the base of your mailing list with current customers and with people in your local area that have shown interest in your product or service. If you do not have a developed list and need to use an outside source to start or flesh out your list, then choose one that gives you the ability to segment and isolate contacts that closely fit the characteristics of your target audience. For example, our (QuantumDigital) list database gives users the ability to segment contacts through approximately 75 different demographic filters. For example, you can narrow down the list to include contacts that match the age and income of your target audience, whether they have children or not, renters vs. home owners, and more. Any tools that offer you control over your master list is a must when getting help from an outside source to build your customer mailing database.

Once you begin to mail to the contacts on your list, make an effort to continually review and revise your list. Check for inaccuracies and changes in status of contacts on your list. Try to further segment your lists by responders vs. non-responders so you can be more specific with the marketing message delivered to them. Whatever your method, developing and improving your list needs to be an ongoing part of your overall direct marketing campaign.

As for that mail-order gourmet brownie company, they were able to take a better look at their list, clean it up, and get back on track. In fact, after refining their mailing list, they controlled catalogue production, increased circulation and bumped up sales by 12 percent. Now that’s a sweet deal!

*The referenced article, Fairytale Ending, can be found in the March 2008 issue of Deliver® magazine. Samar Farah is the author of that article.