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Direct Response Marketing

Thinking on the Side of the Box

1 Oct, 2012 By: Doug McPherson Response

Transpromo — marketing via transactional customer communications — gains new life with new technology and some good, old-fashioned know-how.

It’s like that old Reese’s commercial: “Hey, you got your chocolate in my peanut butter. Hey, you got your peanut butter on my chocolate.”

For “transpromo” — a DR tool that puts marketing messages on transactional customer communications — the script might read: “Hey, you got your message in my envelope. Hey, your message is in my envelope.”

Sometimes, combinations just work. It’s true for some candy and true for some DR approaches. No doubt, transpromo has been a tasty tool for DR marketers the world over. But have marketers lost their appetite for transpromo amid a massive menu of delectable digital, high-tech and mobile options — a veritable smorgasbord of mouthwatering temptations?

If they have, they might be missing a key course at the DR dinner table. It appears transpromo has been experimenting with its recipes and cooking up some new flavors of its own.

Transpromo Hits the Target

“Transpromo is the fastest growing segment in print, and it truly delivers amazing results,” says Shelley Sweeny, vice president in the graphic communications business group at Xerox. “The most important aspect of merging transaction data and promotional content is that transaction documents get opened and read.”

And, of course, in some instances today, they don’t even have to get opened — the messages are on the outside of boxes and envelopes.

According to Matt Swain, associate director of document outsourcing at InfoTrends, a market research and strategic consulting firm for the digital imaging and document solutions industry, recipients open and read 95 percent of transactional documents, substantially more than any other type of mail. And that’s not all:

  • On average, consumers spend up to four minutes reading and reviewing these documents.
  • While inserts often hit the recycling bin without a second glance, a message placed on the face of the document carries significantly more value.
  • Messages can be highly targeted to each individual.

Swain adds that bills and statements are opened more than any document received by mail and consumers actually read and review them.

Sweeny also cites research from the Rochester Institute of Technology that relevancy combined with personalization in transpromo efforts boosted response rates by upwards of 500 percent.

Sweeny says transpromo is being “refined and improved” with cross-media analytics and measurement and a “commitment to continuous improvement.”

Xerox itself has become a prominent player in transpromo, having added several tools and services such as workflow, data preparation and print technologies, and Xerox now offers many webinars and workshops for those interested in adding transpromo to their marketing arsenals.

In one example, Sweeny says Budco, a Xerox customer, delivered significant results to its client, Ford Motor Co., in an extended service application. In a 1:1 lab test, sales of extended service programs for Ford F-150 trucks rose by 35 percent by using relevancy. Further refinement and subsequent application to most of Ford’s vehicle models generated a 24-percent uptick.

“In today’s challenging environment, delivering real results with transactional marketing works,” Sweeny says. “This is a tremendous time to rethink marketing and communication. Transactional documents provide the data you need for success.The key is to be relevant, engaging and in the moment.”

Not Traditional but More Relevant

Relevant, engaging and in the moment are words Zadspace has taken to heart. Zadspace, an advertising technology company in Norwalk, Conn., is putting upsell messages on the outside of direct-to-consumer packages.

Sweeny is a fan. “I love what they’re doing. What a great place to use relevancy,” she says. “They’re always timely and visible. They’ve taken an established concept, the delivery package, and created a new business opportunity with full-color printing and relevancy.”

Jeff Giordano, CEO of Zadspace, describes the company as “part of an ever-growing trend committed to delivering personally relevant promotional messages to consumers.”

“It’s simply a matter of expanding your imagination beyond traditional channels and using existing real estate to deliver data-driven targeted promotions,” Giordano says. “In our case, the real estate happens to be on the outside of direct-to-consumer packages. Other channels might include addressable TV, targeted billing statements or invoice messaging, direct mail, catalog blow-ins, etc.”

Zadspace ads are solo and fully revealed — only one message on the package, and they’re delivered near in time to a transaction.

“Recency has always been a key metric for direct marketers,” Giordano explains. “Plus, our promotions are delivered inside the home — not in a cluttered mailbox or through an out-of-home network.”

But what Giordano likes to emphasize is that Zadspace is introducing demographic, socio-economic, behavioral and geographic data into the mix to ensure the right promotion goes to the right consumer.

“We print in a variable on-demand environment, which allows contextually focused promotions that can be changed printed in real time,” he says.

Today, Zadspace is working with several catalog brands to develop targeted upsell and cross-sell offers on their own packages using its “Zadware” and third-party data.

“We’re also beginning to test third-party offers in the home security, home goods, reverse mortgage, auto insurance and epicurean spaces,” Giordano says.

The company can now scale and handle 100 million packages per annum. Stiil, Giordano waxes philosophical when discussing transpromo. “Silo-like media channels and the idea of will ultimately be a thing of the past,” he contends.

Instead, he believes “omni-channel marketing” that’s tailored to specific consumers, regardless of delivery system, is the world of today and tomorrow.

“Transpromo is less about channel or delivery method and more about developing a one-to-one message at or near in time to a transaction,” Giordano adds. “The message might be delivered on a statement, in a catalog, on a store receipt, in a direct mail piece, or even, in the case of Zadspace, on a direct-to-consumer package.”

Is Transpromo for Me?

Giordano suggests that DR marketers look at the entire ecosystem that might be involved to determine if it has sufficient program benefits to test.

“Ask these questions,” he says. “Recency: How near in time is the transaction to the promotion? Then data: What type of data, transactional, survey, etc., is being used and is the promotion relevant? Then ask what the message size is, its visibility and impact. And finally, ask, does the program provide dynamic versioning that can be modified in real time? If the ecosystem seems right, then do what any self-respecting marketer should do — test.”

Giordano believes transpromo hasn’t been “sufficiently recognized or even understood” by brands and their agencies. “Transpromo takes tried-and-true direct marketing principles — recency and targeting — and puts them on steroids,” he says. “When renting a third-party list, for example, finding consumers who’ve made a purchase within 90 days is desirable. In the land of transpromo, recency can be ratcheted from 90 days to within 24 hours — this makes a huge difference. Add data and relevant messaging, and you have created a formula for transpromo success.”

Another company that appears to have a formula for transpromo success is the customer communication technologies behemoth Pitney Bowes.

Kevin Klein, vice president and enterprise solution principal at Pitney Bowes, says his company taps transpromo because it has a proven track record. “Transactional mail has open rates of greater than 95 percent and the data on the documents, such as account balances and addresses, can offer customer insight. It’s an opportunity to present more relevant offers,” he contends.

Even though transpromo has been around for a while, Klein says DR marketers can now synchronize content on both printed and digital documents and even sell space to relevant third-party advertisers using geospatial and demographic targeting for more effective customer communications.

As an example, Klein says Pitney Bowes is working a with marketing firm, Media Horizons Inc., to offer advertisers what’s called the “MarketSpace™ Web” platform that lets third-party advertisers choose and buy ad placements based on demographic and geographic targeting.

MarketSpace uses Pitney Bowes software to find white or unused space on transactional documents such as statements or bills, analyze the document recipient, match the recipient to an advertiser’s target segment and place the appropriate message without the burden of complete document redesign.

Media Horizons has several advertisers across a broad spectrum of product and service categories, ready to buy ad space.

Klein says MarketSpace allows for printing personalized color messages and graphics on the outside of each envelope to increase open rates.

“Along with today’s envelope wrapping technologies, where pre-manufactured envelopes are not required, organizations can more cost-effectively produce mass mailings that have the look and feel of personal correspondence,” Klein says.

Pitney Bowes has also unveiled a new “Print+Messenger™” color inkjet system that prints high-resolution, color-customized marketing messages on envelopes during high-speed mail insertion.

Klein says the technology improves operation efficiency because it eliminates preprinted envelopes, reduces envelope storage needs, streamlines application changeover and allows mailers to commingle mail for postage discounts.

“This eliminates the need for organizations to use anything other than plain white envelopes for their customer communications,” he says. “All the necessary information, including customized marketing offers, company logos, mailing and return addresses and postal barcodes can be printed directly onto the envelope as it travels along the inserter.”

And he says that for tracking transpromo results, campaigns can build in unique key codes and links for collecting precise one-to-one data. Key codes are captured as consumers arrive at touch points, and this information can be used to create campaign metrics and analytics. A technology that is rapidly gaining momentum for in this area is, of course, is the QR code — the quick response, two-dimensional barcode. This code stores offer information and facilitates hot links to URLs and personal URLs for redemption and response metrics.

Jim Kabakow, CEO of Media Horizons, says transpromo remains relevant because of the targeting available through demographic appends and purchase data.

“This combination of attributes makes transpromo a very powerful resource for marketers to provide relevant offers to consumers,” he says. “It’s also a very scalable channel due to the billions of transactional documents printed and sent every year.”

Pat McGrew, the production mail evangelist in the IHPS Group at HP — who says she’s one of the first educators in transpromo and similar techniques and who has worked on seven books on multi-channel document delivery — says, “If you think that transpromo is just an ad on a bill, you missed the point. If you think that transpromo is a panacea for other marketing that doesn’t work, you’ll be disappointed.”

McGrew says every DR marketer should know that if they are working with an organization that has a transactional relationship with their customers, they should be using transpromo.

“They carry a gravitas with them that causes them to be opened more frequently than solicitations. However, statement-based marketing should never be standalone. It should be coordinated as mass media, direct and online marketing. If it isn’t, it is a waste of effort.” ■

About the Author: Doug McPherson

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