This article by John Lenser article of CohereOne addresses the importance of maintaining a proper postal program as an integral driver of measurable store sales.
June 27, 2017 | Author: John Lenser
Last week I was sad to read that one of the first “brick and mortar” clients I worked with 20 years ago had declared bankruptcy. I was reminded of the initial project that I did for them. They had hugely expanded their catalog program, mailing many millions of catalogs over the year, but with results that were less than half of what had been predicted by their new catalog director. They asked me to figure out what had gone wrong. I determined that two-thirds of the target population of the U.S. lived within twenty miles of their 300+ retail stores. The response rate within the store trade areas was approximately one-third of the response rate outside the trade areas. It was evident, however, that they had budgeted the higher response rate received outside the trade areas for the entire mailing.
I recommended that they continue the catalog program, but accept that the differential catalog sales between the trade areas and non-trade areas occurred in the stores. Management was unwilling to justify the catalog program on this basis, maintaining that the catalog program had to stand on its own. Thus, the catalog program was discontinued. The following year, the company experienced a seven percent decline in comparative store sales! As a result, the board fired the CEO. I suspect he never knew why store sales had plummeted and why he truly lost his job.
Since then, we have worked with many store retailers who maintain a postal program as a key driver of store sales. We have become much more knowledgeable in the programs that we recommend and how we measure results.
When considering a catalog or direct mail program in a retail environment, it is fundamental to recognize that you are appealing to both those who are direct marketing responsive and those who prefer to shop in a store. The latter group is a much larger audience and requires a very different marketing program from that of a typical catalog company. Keep in mind that one’s website is also a retail store that is open 24/7, so much of the following discussion applies to all direct marketing companies. Let’s examine the following factors: