Should You Use Surveys in Your Direct Marketing Research?

Should You Use Surveys in Your Direct Marketing Research?
By
Marty Gross


How can you make more effective and timely decisions in direct marketing…decisions that will allow you to understand what the market is asking for? You need marketing research.


Marketing research allows you to capitalize on opportunities you may not have been aware of. In addition, you’ll be able to actually forecast perils and problems before a major disaster swamps you.


However, already armed with the ability to test and change plans quickly, direct marketers may question why they need put any money into marketing research at all. After all, direct marketing is its own research vehicle, isn’t it?


Unlike other marketers, direct marketers can measure the results of their advertising spending at once. There’s no waiting as the sales numbers trickle in from the field over weeks, even months and quarters, and reports are slowly analyzed.


You learn immediately if a campaign is not working. If your test package outpulls your control, you can take advantage of it right away.
Where then does formal marketing research fit in to a direct marketing program?

Uses of Marketing Research for Direct Marketers

As useful as the research side of direct marketing can be as an information-gathering tool, there comes a time when only formal market research can gather the right kind of information. Formal marketing research may be thought of as the process of collecting information relevant to a specific marketing problem faced by the company. This requires defining the problem and setting the research objectives … developing a research plan ...implementing the marketing research plan … and interpreting and reporting the findings.

There are at least six ways formal marketing research can work for the direct marketer.

1. Learn which new product ideas to develop first. How viable is the product or service? What kind of success will you have if you launch it? Before putting any money or energy in a new venture, you can determine the degree of its acceptance in the market.

2. Learn just which product features you should stress. What are the features, advantages and, most importantly, the benefits that the market is looking for? When you find out what product benefits to emphasize, you don’t have to spend a lot of time looking for the right benefits to emphasize and those to ignore. You can more into high gear immediately and get the jump on competitors, who may still be experimenting with trial offers.

3. Learn if your creative strategy makes sense — before you test.
How can you save money on testing and your initial investment without jeopardizing a test? Usually, if the test doesn’t work, your costs and time have to be chalked up to experience. Even a small scale test, the kind direct marketing specializes in, calls for an investment in time and money. Wouldn’t it be great if you were able to save even more money …by putting your dollars precisely where they would do the most good, instead of paying production, postage, creative and mailing list costs that have to be swallowed if the promotion is discarded? Due diligence research early in the game can help you avoid many of the small losses associated with testing, failed tests that do add up over the course of time. By getting feedback from a random sample of your target market, you can adjust your sights properly for any size of a test.

4. Learn more about your customers.
Are you taking your customers for granted? Once you have captured a customer base, there is a high probability that these customers will give you a good ROI (Return on Investment) year in and year out. It’s like owning a deep well that never runs dry. However, to guarantee the retention of your best customers, you must keep abreast with their changing needs. Did you live up to your customer's expectations? Has your competitor's product improved so that it has become better suited to your customer's needs? If so, what is lacking in your product? All these questions, and more, can be answered through properly implemented marketing research. Research can provide you with valuable information on the changing demographics and psychographics of your customers. You can never stand pat: what last year’s customers were buying may not be their choice this year. Why have sales been falling in certain critical areas. Why have sales picked up in otherwise slow-moving regions?

Reasons and answers are what marketing research can provide. Research will tell you how your company how a company is viewed today by present and potential customers.. Information like this can help you shape a marketing plan for the future.

5. Analyze shifts in the marketplace.
What’s happening in the marketplace, now and tomorrow? By keeping tabs on the market through formal marketing research, a company can forecast changes and plan accordingly Unprofitable areas can be dropped before becoming critical, and new exploitable possibilities can be explored carefully and discreetly, without letting competition know your future plans.

6. Replace or precede costly and chancy dry-testing.

Dry-testing is promoting a product that may still be on the drawing board in order to test response before incurring production and shipping costs. To avoid customer complaints, it's usualy done on a small scale. Naturally, any cash orders must be refunded, and postal and FTC regulations require that respondents be notified if there is any delay in shipping, with the opportunity for them to cancel.

Marketing research can obtain the same information for a marketer without running the risk of violating FTC regulations. Formal market research can eliminate, or at least back up the classic dry test: mailing to a amorphous prospect base a promotion piece for a yet-to-be-determined product. There’s less chance of possible violation of FTC rules. And there’s also less chance of an alert competitor getting hold of the promotion and getting a good idea of your marketing plans.

©Copyright Martin Gross 2009

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Tune In to These Sound Radio Ideas

Tune in to These Sound Radio Ideas
By
Marty Gross


Heard any good mail lately? Here are 3 effective techniques borrowed from radio that you can adapt to direct mail.


The medium of radio is becoming popular again as an advertising vehicle for direct response. While direct mail writers enjoy writing radio commercials, it’s really a two-way street.

Broadcast writers can bring their special skills to direct mail, giving it an exciting flavor.

Here are three devices from radio that can be used in direct mail.

1. Brevity. The first is the necessity to be brief. You just can’t run on in radio. If the commercial is 30 seconds long, you can’t write 32 seconds’ worth of copy.

A copywriter therefore learns that you don’t have to repeat anything to make a point.. that you can use inference, tone and pacing to sell ... that simple words work better than convoluted ones ... and that brief sentences are easily understood, whereas long, involved sentences can baffle the listener.

Transferring these lessons to direct mail can transmute a dull package into a golden money-maker. For instance, very long copy is sometimes necessary to sell something. But if the length of the copy is only the result of repetition and reiteration of the same points, you’re wasting your time and insulting your reader.

Writing broadcast copy can teach you how to sell gracefully and quickly. In this impatient era, when most people just can’t find the time to read a lot of words, stylish brevity can win you friends and customers.

2. Contiguity. Another selling idea you might want to borrow from radio is contiguity. This describes two programs next to each other in time and sequence that are not interrupted for commercials or announcements.

A mailing who has two products might want to make two mailings to the same household at the same time. For instance, a magazine publisher offering a photography magazine and a travel magazine might want to send separate but equal packages to the same list. Each package would identify the publisher, but would not refer to the other offer, so as not to detract from the subject of the mailing.

Assuming the one list has customers for the two magazines, synergy might create a harder-selling environment, with both publications benefiting from the double exposure.

Some observers will quietly point out that two different mailings from the same publisher to the same list at the same time might confuse the recipient and make him decide to accept no offer at all. That’s why testing is important.

3. Hitchhiking. The third radio device is hitchhiking — using a short commercial near the end of a sponsored program to push a product not previously mentioned. This “by-the-way-folks” reminder is a way of giving exposure to a small-budget product and taking advantage of any “halo effect” by the heavily advertised item.

In a mail package, some other product can hitch a ride with a postscript, buck slip, flyer, or a box on the order form to be checked off. This will serve to introduce a product cheaply or get rid of extra inventory. Because direct mail can be more finely tuned than radio, only a portion of a mailing need receive this hitchhiker.

So you can test it without totally committing yourself or you can send it to only those prospects you judge to have the greatest interest in the offer. It’s a way of getting the hitchhiker to pay the tolls.

Direct marketers have found that it is essential to be able to move in and out of different media to take advantage of different windows of opportunity. The successful copywriter doesn’t have to put on another hat to work in a different medium, though. The lessons learned on one platform can be applied at another time in another place, often with gratifying results.

©Copyright Martin Gross 2009

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Really Cheap Direct Mail Testing Ideas

Really Cheap Direct Mail Testing Ideas
by
Marty Gross

Add a survey in the form of a one-page questionnaire.

Change the outer envelope.

Create a single package to test multiple offers and copy platforms.

Create test packages with elements that can be changed at minimal cost.

Ignore lists with low total counts.

Test meaningful differences only. Ignore minutiae and the insignificant.

Print mailing pieces in no more than two-colors.

Test a BRE versus a CRE, especially in fund-raising.

Test a single element or a completely different approach.

Test black white vs. color.

Test bonus.

Test during off-season months.

Test editorial self-mailer format.

Test envelope teaser.

Test free gift.

Test free trial offer
.

Test headlines vs. no headlines in sales letters.

Test inexpensive involvement devices like sticker tokens.

Test long vs. short headlines.

Test major benefits against one another
.

Test media choices.

Test minimal production against a more lavish mailing.

Test no graphics vs text and graphics.

Test only one thing at a time.

Test outer envelope copy.

Test positioning alternatives.

Test short letter vs long.

Test short term intro offer.

Test simple ideas, not complicated concepts.

Test sampling.

Test simple inserts.

Test small brochure vs large brochure.

Test special pricing.

Test the product or service itself.

Test giveaway offers, such as: Free catalog…booklet…demonstration…survey and estimate.

Test timing.

Test volume discount.

Test new lists with oversize postcards, not packages.

Try for radically different approaches.

Try phone or e-mail interviews to test new offers.

Try print ads to test proposition.

Test buckslips or inserts in one or two colors.

Test no more than 10,000 pieces.

©Copyright Martin Gross 2009

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Harnessing Wordless Appeal in Direct Mail

Harnessing Wordless Appeal in Direct Mail
By
Marty Gross



What are you trying to say? And are you sending the right message? Your direct mail may be saying too much or too little — and the graphics may be fighting the copy! Here’s how to get everything back in sync with “The Single Perception Precept.”

Direct mail promotions usually carry two sets of signals — the verbal message told by the text and an unstated one, which is conveyed by graphics. In a well-thought-out campaign, these signals will ordinarily augment each other. But sometimes the messages can get confused.

For instance, a spectacular mailing may tie the reader up in knots because it is made up of a colorful large outer envelope with a long-winded “legend” or teaser, a 4-page letter with heavily personalized text and marginal annotations in imitation handwriting, an order form (also personalized) with an involvement device and a complicated offer, a hard-breathing lift-letter urging the recipient to ACT NOW!, a premium flyer plus an intricately folded brochure.

There’s a marketing idea called The Howard-Sheth Theory of Buyer Behavior that says an over-burdened stimulus such as this may upset the prospect, causing an unwanted purchase behavior pattern to emerge... one creating tension and even refusal in the all-important predecision evaluation.
(Howard, J. A. and Sheth, J. N. The Theory of Buyer Behavior. NY: Wiley, 1969)

On the other hand, an understated self-mailer or email — the sort of off-hand announcement that’s more like a business card than a sales piece — might depress results. This is not only because of its failure to convey enthusiasm or even share information but also because of its indifferent “take it or leave it” attitude.

This sometimes happens when advertising people have no real say in the advertising process. It’s an incongruous state of affairs not infrequently encountered in technocratic enterprises like software companies, universities, professional associations and scientific book publishers. (Exception: On some occasions, it’s been known to happen that the very same unenlightening format may improve response through the “mystery” approach, where the sheer lack of information may sometimes prompt inquiries, proving that fortune sometimes favors the fatuous. )

The confusion rising from the written message fighting the graphic one can be eliminated through the application of the Single Perception Precept. This recently developed formula states that prospect behavior can be improved when the marketing message isn’t befuddling. It identifies four message mixes, each with its own verbal and graphic phases. Which ones to use? It all depends on whether you are conversing ... cooperating ... co-acting ... or coercing!

Intimate Message. Verbal phase — this is a warm, very personal tone. It can be used to sell insurance, health and self-help products. There is a heavier than usual reliance on the first person, contrary to the usual direct mail rule that says you should use the “you.” The equivalent speaking level would be a semi-whisper.

Intimate Message. Graphic phase — personal stationery, or executive-size 8” x 10” sheets, printing with only the product name or the name of the sender. Rather than hard-edged computer typefaces, a typewriter font is preferred for the letter. There are some marketers who haven’t been above the occasional “typo” or misspelling. Imitation script, while too hard to read in a long letter, can be used for the lift letter — which should look like a message dashed off at the last minute. The signature may be just a first name, and the PS might even be handwritten.

The brochure might use photos of people in friendly poses. Novel or intricate folds can be a bother here. Type should be a “friendly” serif face, rather than a hard, machine-like contemporary san-serif. Outer envelope, which should be personal rather than institutional in size, should be closed-face, perhaps with a typed corner card, and with stamps, or meter rather than printed indicia. Any teaser copy on the envelope must carry the feeling of a personal note.

Personal Message. Verbal phase — a conversational tone used among acquaintances. Excellent for renewal series, customer promotions, travel promotion, sales reminders. The sales message should emphasize reason-why, which, of course, is a good idea for any mailing! Gentle, self-deprecating humor would not be out of place. The equivalent speaking level might be a soft voice at a dinner table or a moderate volume outdoors or in a car.

Personal Message. Graphic phase — more spirited than the intimate message. You can use 8-½” x 11” company letterheads here with impunity, as well as unconventional formats. Choppy sentences and single sentence paragraphs should not be dismissed. They can really work for this audience. Both personalized or printed letters have their place.

Brochures can be colorful exciting sales pieces. Post cards, self-mailers, gadgets and involvement devices can work here. Outer envelopes can be 6” x 9” , Number 10, monarch, baronial, or even 6-¾. Teaser copy here can be playful.

Impersonal Message. Verbal phase — strictly business. For banks, large corporations, financial products and services, expensive merchandise, real estate investment offers, business-to-business. The sales message should be straightforward and consistent, though well-reasoned. This is full-voiced selling, or telling — a superior talking to a subordinate, for instance.

Impersonal Message. Graphic phase — rich paper, unless budget items are being sold, business stationery, block paragraphing, bold signature in blue. Neat, bulleted paragraphing works here.

Brochures should have call-outs, technical illustrations, products in use. Sales literature should be the kind that executives might send along to colleagues, or used to persuade others in the organization, or to justify the expenditure.

The outer envelope must be able to get around the mailroom and secretary minefields. They should look businesslike, rather than frivolous or cheap.

Public message. Verbal phase — preferred by fund-raisers, religious groups, institutions and politicians. Words are carefully thought out, and, at times, the tone may even be a trifle demanding, thought not full-volume.

Public message. Graphic phase — importance and sincerity must be evoked, and, in the case of fund raising, an awareness of costs should be apparent. Letters may be on 8” x 10” letterheads. Elaborate promotions really send the wrong message here.

Brochures should be simple folders, folders in letter format, or easy to read booklets, without ostentatious printing devices such as holograms. Return envelopes may ask for a stamp to save money. Simple outer envelopes may be a little message; in the case of charities, just short of a begging appeal.


©Copyright Martin Gross 2009
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Developing a Recruiting Program for New Sales Blood That Delivers Prime Candidates.

Developing a Recruiting Program for New Sales Blood That Delivers Prime Candidates.
By
Marty Gross

• · Reduce the Expense of Shotgun Advertising
  · Tap New Audiences to Expand Potential Recruiting
  · Take Advantage of a Multi-Media Marketing Plan to Reach all Potential Candidates
  · ...With a Well-Planned and Tailored Direct Marketing Campaign that Can Improve Recruiting Many Times.
  

To better accomplish your sales recruitment goals, consider direct marketing as a cost-effective method that can help you successfully find the candidates you’re after efficiently and effectively.

With a well-planned direct marketing recruiting campaign, you can control how many potential candidates you will hear from, when you will hear from them, and how qualified they are. Through direct marketing you can also survey the field to identify changing perceptions about selling, your firm, and salary requirement. In addition you will reduce the uncertainty associated with building a sales force because you’ll generate a controlled flow of qualified leads, reducing the need for and expense of wasteful “shotgun” advertising.

To increase the effectiveness of your direct marketing recruitment campaign you’ll need to develop a direct marketing package that complements your firm’s overall marketing strategies. You’ll also need to compile a mailing list that targets an audience with the ability, experience and desire to respond to your direct marketing campaign.

What Should Your Direct Marketing Campaign Include?
To be successful, a direct marketing package must evoke response. To do this, the package needs a strong offer. This is the promise of the transaction.
There are a number of elements to the offer which must be carefully balanced. These include:

1. Salary/Compensation. This should be the central focus of your direct marketing proposition. If you undersell this benefit, you may severely lower your response potential. If you purposely oversell the salary/compensation offer, you can expect a great number of underqualified responses.

2. Growth and Advancement Potential. This includes not only what you believe the potential should be, but what the prospective new salesman perceives its value to be. By copy-testing different objectives and goals you may learn that the new salesman will pay more attention to a minor objective you hadn’t really considered important, or that the increase in response to a career objective substantially offsets a lower compensation package.

3. Terms of Compensation. To increase the effectiveness of your direct marketing campaign, you’ll need to determine the methods of compensation your company is best structured to offer. Should it be straight salary? Or a draw against commissions? Or deferred commissions?

4. Incentives and Bonuses. These can be useful in evoking response to your offer. They can be in the form of cash premiums paid instantly upon hiring, third party gifts for recommendations, or other inducements to apply. But premiums must be used carefully. The more you give away, the better response you can expect. This can come at the expense of sales force quality.

5. Guarantee. When applying for a job through a blind box number, for instance, a salesperson doesn’t know to whom he or she is speaking. Confidentiality should be guaranteed. One way to reduce this uneasiness is with a strong guarantee.

The individual elements of the direct marketing package should be consistent with your overall recruiting objectives. If you want the maximum number of responses, use a blatantly big salary offer plus an incentive. If you want the best career-minded candidates, then use goal/objectives. If all you want are exploratory candidates, then a brief trial or free-lance offer is best. But you must always be conscious of the effect that changing elements of the offer can have on results. And you must test wherever possible.

Testing your direct marketing can help determine the potential response to your campaign. This testing can also help you identify problems with your message and adapt your program to meet your recruiting needs.

Different variables should be tested one at a time to help establish or fine-tune a program. For instance, if you choose to test mailing lists, then your design, offer, etc. must remain the same. Likewise, when testing the creative aspects of your program, your mailing lists must remain the same. If not, your results will not be useful. Also when testing, you must use statistically reliable sample sizes. Most direct marketers use probability tables to establish appropriate sample sizes. These tables can be found in many books on direct marketing.

Planning Your Program
As with other promotional media, the key to success with direct marketing is planning. To make sure your campaign achieves your recruiting strategies, you need to develop and adhere to a working plan that meets these objectives.

The Situational Analysis
The first step in planning your program is to review the company’s current situation. This should include both internal and external factors affecting the company, and the program that is planned. For instance, you may want to use direct mail to open up a new area not currently served by your sales force.

Identifying The Target Market
You will need to profile your target candidates. This is especially important for direct marketing because one of its strengths is that it can reach market segments. By properly identifying your best sales force prospects, you can make the job of proper list selection easier, and greatly increase your changes of success.

Analyzing The Job
Your next step is to look closely at your job offer—not just at the features of the job, but also the main benefits for a new salesperson. This is important in terms of copy. Most new salespersons have very little interest in every detail of a job. For a message to compel them to action (in this instance, to apply for the job), you have to tell them how the job will benefit them.

However, direct mail that simply lists a multiplicity of features misses the point. Ultimately, benefits, not features, cause someone to purchase, inquire or otherwise respond. By highlighting the benefits in your organization, you’ll be better able to translate them into major selling points within your copy.

Establishing An Objective
For most direct marketing sales force recruitment programs, the objective will be a version of one of two broad categories: The acquisition of new sales force/prospects at the lowest possible cost or acquiring a sales force through the hiring away from other firms, training new salespeople, or keeping present people happy.

It is important that you choose your objective very carefully. Every other element of your marketing plan must be linked to it. If you’ve chosen an objective which requires a large number of responses, it can affect your offer, the number of pieces you’ll have to mail or the number of ads you will have to place, and, of course, your budget. To make sure your objective is reasonable, it should be quantified in terms of numbers and time frame. For a direct mail program, this should be tied back into the response rate or number of responses during the period of a specific recruitment offer.

Determining A Strategy
Once you have chosen your objective, you will need to choose a strategy for implementing a direct marketing recruiting program that will achieve that objective. This includes both marketing and creative strategies. Generally, you will find that listing several strategic alternatives and the rationale for each will help you reach your goal. Carefully analyze the advantages and disadvantages of each when making your final decision.

You’ll also want to be sure that your strategy is consistent with the image you wish to maintain in the marketplace and that it complies with all corporate policy and legal considerations. For instance, if the objective of your direct mail program is a large number of applications, your strategy may be to mail heavily, test marginal mailing lists, structure a generous offer (e.g., car, generous benefits, high commission, rapid advancement, prime territory, etc.). If your objective is to achieve the highest qualified applicants, your strategy might include reducing your promotional cost, mailing only to experienced salesmen, or best performing lists, and pushing only one benefit.

Establishing A Budget
The last main planning element of a direct marketing campaign is establishing a working budget. You will need to estimate all of your costs and compare them with your expected return. Too many direct marketing programs fail before they even start because this step is ignored.
Since direct marketing is accountable, you might want to do a Profit and Loss Statement before you go any further, to make sure your objective is achievable. This should include—by medium—estimated production, creative, media, fulfillment, (for direct mail: list and mailing costs), and any follow-up costs (callbacks, special interviews, telemarketing support, etc.). It is helpful to look at the impact of the various cost elements on each response. You can do a Unit Profit and Loss Statement, plugging in the applicable cost items, and quickly estimating your expected return. A spreadsheet software program such as Excel can greatly simplify this task.

Having completed the initial planning stages you can now begin work on the creative aspects of the project. Whether you create it yourself, or hire experienced direct marketing professionals to do it for you, it is important to be familiar with all of the elements of a direct marketing program.

©Copyright Martin Gross 2009

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Giving Something Away Carefully

Giving Something Away Carefully
by
Marty Gross

When the sales manager complains that his sales force can't handle the number of leads generated through your promotion, or when you're in of running out of booklets, just how do you cut back on inquiries? Unfortunately, the copywriter who is trained to sell heavily sometimes doesn't how to pull back and make the mixture leaner rather than richer. Over the years, however, copywriters have “perfected” 10 techniques.

1. Instead of giving your free booklet an interesting title, just call it “Free Booklet.” This is a guaranteed way to remain small ~and exciting. Years ago, if Merrill Lynch had decided to call its phenomenally successful booklet “Stocks and Bonds, a Guide” instead of “What You Should Know About This Stocks & Bonds Business,” the firm probably would have remained a small regional broker. So if you don't want to add personnel to handle the overflow of leads, or if you're aiming at a very selective audience, be sure to take the sell out of the title.

2. Make sure your description of the free booklet's contents is dry and rather cryptic. Look over standard college-course descriptions to get an idea of the style you should use to discourage idle curiosity seekers from sending for your free booklet. Perhaps just shortening the description or eliminating it entirely will do the trick.

3. Imply that sending for the booklet may be harmful to the would-be sender's health. Play down any advantages or benefits the product or services may have. Exaggerate the time or expertise needed to install it (this is especially effective in computer software advertising). You'll find that dilettantes will stay away in droves.

4. Hide it. If you mention the booklet without showing a picture of it, this can effectively play down any value it may have. If you must show the booklet, be sure not to caption the illustration. You'll be able to devote the space thus saved to selling the product, instead of promoting a giveaway. Triflers will be discouraged.

5. Set up a number of rules that must be followed before you'll give away your booklet. These demanding qualifications will go far in separating the sheep from the goats. For instance, be sure to state an age or income qualification by inserting a box to be checked in a coupon. Each obstacle you put in the way of a prospect will further winnow out sales-literature collectors.

6. Consider a couponless ad. In making your prospect show stronger interest by requiring more effort on his part, you filter out all those coupon-clippers who just want to receive mail.

7. Be more stringent about giving away your booklet. Erect more hurdles in the coupon. Make the inquirer sign the coupon. Ask him to carefully print the size or model number he's interested in. In a business-to-business coupon, no matter how limited the space, ask for a title, and insist that the inquirer give you his phone number and his fax number as well as his e-mail address.

8. Devote less copy to your free offer. Don't put it in a headline. Bury the offer in the body of the text. This is a device often used by auto manufacturers who have a detailed and interesting brochure to give away but who naturally are more concerned in coining phrases like “First in Its Class” or “A Luxury Automobile for the Way You Live Today.”

9. If you find that you're still getting a lot of inquiries, you might consider charging for the booklet. This will help lessen the number of people with their hands out for something free; the fewer prospects who do come in will have really shown their sincerity and should be easier to sell. Be careful, however. Many years ago, a carefully informative and factual advertisement for Rolls-Royce was written so cleverly and clearly that its quietly diffident offer of a $10.00 descriptive brochure was taken up by thousands of charmed readers. Despite the classy attempt to discourage hoi polloi, the Rolls-Royce showrooms were swamped with responses from people who had never even been in a Roller, let alone owned one.

10. Don’t allow the quality of your product or your sales prose to encourage unworthy and undesired inquiries. Frequently, the enthusiasm or supercharged energy of an ad or commercial will carry all before it, and inquiries for free information will get out of hand. Tone down your headline and tune out obvious customers an prospects by using bland, confusing language that will make it difficult for your audience to know whether you’re selling credit cards or underwear. Rule: unselective copy will result in highly selective inquiries.

©Copyright Martin Gross 2009

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Open Systems Open New Idea Doors

Open Systems Open New Idea Doors
by
Marty Gross

Systems theory allows the observer to see relationships that otherwise might not be noticeable. Basically, in this discipline, a system is a perceived configuration—an entity or unit. While in business and management it is usually used to analyze organizations, systems theory may have a special application to direct marketing.

Looking at direct marketing from this standpoint might open up new areas of investigation. For instance, you might see if there are forces and processes of interaction shaping direct marketing that might be harnessed to aid decision-making and action.

Systems theorists differentiate between closed and open systems. Basically, a closed system can be something like a cloistered religious community, complete unto itself and not requiring any contact with the outside world. Obviously, direct marketing would not long survive this sort of isolation. It's an open system, like the cell, the car and family. To do its job properly, it uses energy from the environment, transforms it and then returns the energy back to the environment in a different form.

As an open system, direct marketing exhibits the following characteristics (drawn from D. Katz and R. I. Kahn, The Social Psychology of Organizations):

Input. This is the importing of energy from the external environment. In the same way cars import gas and cells import blood and oxygen, direct marketing imports information and manpower. An efficient open system will make more use of the energy it imports than a “gas burner.” The efficient direct marketing program will not be top-heavy with managerial types and won't flood its system with too much distracting information or, worse, unprocessed data. (There is a good case, however, for importing a little more energy than you need. See “negative entropy” below.)

Throughput. A trophy worthy of the Jargon Hall of Fame, but systems analysts have latched upon it to describe the process open systems use to make use of available energy. In the same way that the body might convert starch and sugar into heat, direct marketing chews up (a) market and product data to create a service or product and (b) inspiration, insight and talent to create persuasive promotions.

Output. An unhappy part of the analogy! The car exports exhaust fumes, the body gets rid of waste materials ... and what does direct marketing do? It sends out promotions and products.

Cycles of events. A metaphysical or dialectical stage. In this example of recycling, sending out an output makes input or importing possible, which leads to processing and further output, and so on. In direct marketing, this would be the recycling of occurrences or events: Production and promotion lead to responses, inquiries and sales, which lead to more products and promotions. So rather than think of a promotion as an isolated event, consider it a link in a chain or an act in a play.

Negative entropy. Alas, all things must come to an end. The natural process of entropy inexorably moves from decay to dust. Direct marketing, using negative entropy, attempts to defeat this by importing more energy than is sent out. This can produce flab (heavy inventory). It can also produce fuel for a long hard winter (extra cash, and “impractical” research and development that eventually pays off).

Information input, negative feedback and the coding process. For any direct marketing operation, negative feedback can be very positive—it's the information received that tells you, for instance, which list has been naughty and which has been nice. The coding process is another jargon term that simply means the sorting of useful and useless information, such as over elaborate tests that experiment with the color of postage stamps or the use of serif vs. sans-serif typefaces on lift letters.

The steady state and dynamic homeostasis. Any open system surviving by importing energy to offset entropy is said to be in a steady state. However, because environments change, systems must change as well to counterbalance any disruptive force. A catalog company may shift, for example, from selling to rural customers to marketing to city dwellers. Adjusting this way by preserving its character as a catalog company but changing its market to peddle the same old merchandise to a marketplace that doesn't want it, with the result that entropy builds up and with it the end of the business.

Differentiation. The catalog company that once tried to be a department store in print, catering to a far-flung customer base, now carefully segments its marketing with specialized catalogs to targeted groups. This form of specialization is true of all open systems, which move from a state of overbusyness to specialized and standardized operating systems, in a bid to achieve greater efficiency.

Equifinality. Reaching the same goal through different means. One magazine publisher might achieve its profits through reducing the number of magazines issued and concentrating on seminars and video cassettes; another might diversify into newsletters; a third might go into broad casting. In direct marketing, one mail order book publisher might build a system of book clubs; another might concentrate on one subject; and a third might go for coffee-table books. •

©Copyright Martin Gross 2009

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