Thursday, January 12, 2017

How Direct Mail Testing Differs by Product Stage

Direct mail success is all about testing -- lists, offer, creative, and, of course, the product/service itself. While there's no single formula, Malcolm Decker's excellent article "How to Test Your Direct Mail" in Target Marketing magazine's resource section offers some useful guidelines. Decker differentiates the weight given the various direct mail testing parameters by a product's life cycle--new product testing; honing success of an existing product; and testing to revive a mature product. For example, his ideal new-product test is mailed to 120,000 names, with the house list providing less than 20% of names mailed, and testing of 15 different lists, three different prices/offers, and three different creative packages. In looking at the relative contributions of testing factors, he notes that even the most well-researched new product can impact results by 30% plus or minus. Mailing lists--ranging from tightly targeted response lists to larger, broader and thus riskier lists--will contribute another plus or minus 30% to success, based on Decker's experience. Then the price/offer will deliver another 30% up or down. And last, the creative factor for a new product can move the testing needle by another plus or minus 10%. Once marketers have a couple of years of mailing results to help determine price elasticity, list universe, creative preference, premium impacts, etc., Decker notes that the 30-30-30-10 relationship of start-up testing has shifted. And once a mature product's marketing choices face the challenges of competition or changing tastes and demographics, the weights of key testing factors shift once more. For more on testing parameters for proven and mature products, see the full blog post at