Direct Marketing Essentials – Developing the Offer

In direct marketing terms the OFFER may include free information, incentives, or rewards for loyalty and continuing to purchase from you. Basically it can be anything that helps drives your target market to purchase.

So even if you have the best product on the market, you can achieve better results by developing a RELEVANT offer to make your small business stand out from the crowd.

So what are the main considerations when developing the offer?

Offers should be designed to be relevant to your target market and to the product or service you are providing. They should also be timed well to help position your product effectively.

If the direct marketing offer you’re providing doesn’t complement or add value to what you are trying to sell, then your prospects won’t commit. In most cases, the offer is the difference between success and failure.

I’ve found that the biggest motivator is prospects’ perception of the value of the offer you provide relative to cost of the actual product. Further still, most people are motivated by something for free or any special privileges associated with the purchase of a product.

But I think it’s important to discuss some of the pros and cons for all the various offers out there, plus some of their associated hurdles before you start discussing options with your designers, printers or mailhouse.

Free Offer: Buy a newspaper and get a free CD! Offers like this helps to increase short term sales. On the other hand, if you provide free information in an offer-package then you encourage customers with a higher commitment potential. E.g. Get the first lesson free!

Samples: If you include a free sample in a direct mail piece then you need to account for cost considerations. If you ask for a nominal price then it encourages commitment and a bit more interest.

Free Gifts: This must be appropriate to the product or service sold or your prospects won’t commit. The FREE set of steak knives would only be of value if you were selling other kitchen appliances…..or an abattoir perhaps?

Free Trial: This is fairly standard with most direct mail pieces. The good news is that it can double orders when compared to offering just a money back guarantee.

Free Shipping: Spend more than $100 and we’ll post it to you for free! If your product is available internationally, then you may want to revisit your cost margins and breakeven point before going to market with this type of offer.

Sweepstakes: This is great at commanding attention and causing excitement. Sweepstakes always boost sales, but these days it is better to offer a prize everyday of the month to keep your prospects interested, rather than offering one big lofty prize. Just make sure the sweepstakes doesn’t cast a shadow on what you’re actually trying to sell.

Time Limited: You can further overcome buyers inertia by making your direct marketing offer time limited, as everyone hates to miss out! If you give a reason for your prospect to act immediately then you will have a greater chance of making more sales in the short term.

Exclusive Membership: Subscribe for a fee and receive exclusive discounts, benefits and experiences which aren’t offered to the general public. Just make sure the membership has the right mix of benefits to get your prospects lining up at the door.

A lifetime membership could also be used as it offers no commitment to ongoing purchases required.

Discount Offer: Always be careful offering discounts as your primary goal is to make a profit and not to cannibalise sales you would have made anyway. Just because you get a great response, doesn’t mean you will have healthy margins. Plus, if you always offer a discount then you are teaching your target market that your prices are too high.

The only time you should discount is when you believe you can gain an incremental purchase. For example, if you have a new visitor who becomes a repeat visitor a certain number of times but doesn’t buy, then perhaps a discount will help overcome this.

Invitations: We invite you to attend a free seminar to learn more about XYZ! Invitations are used primarily for business to business direct marketing. Just make sure that you get enough attendees showing up on the day or it may be detrimental to your product or service.

How you can add value to your offer to increase response?

As an expert marketing consultant, I recommend four ways to add value and help lift the number of responses to your direct marketing efforts. I always tend to include at least three of these in every Direct Mail piece to help further overcome buyers inertia.

1. Payment Terms: You should give as many options for payment as possible, and pay particular attention to the age group of your target market. Baby Boomers and beyond like the option of paying using bank cheques and many elderly buyers still do not know how to use the internet compared with younger generations who were brought up on computers. Other payment terms to consider include credit card purchases, BPAY, EFT Transfer, Cost on Delivery (COD), part payments revolving credit and offering open accounts.

2. Response Methods: Some people like to pick up the phone while others prefer email contact. Either way, you need to ensure response options stand out from the remainder of the DM piece. These include Freecalls, 1300 numbers, switch numbers, coupons, faxes, email. I’d also like to point out that 1800 numbers (Freecall) are only free when you call form a landline. Many mobile plans charge for 1800 numbers over and above your monthly cap, which has recently aggravated many users in Australia. So beware!

3. Endorsement Letters: These always prove effective provided they are legitimate! Testimonials and publishers letters are great to help endorse a product and overcome buyers inertia. I generally use three testimonials as a minimum to help sell a product or service.

4. Money Back Guarantee: This is standard practice these days. If you believe in your product or service then you should include this anyway. Plus it helps reassure purchases without the need of viewing the product.