In my last post, I talked about the nightmare of customer defections and showed you a dramatic calculation that demonstrated the profit you sacrifice when they leave you.

If you lose one customer every day who spends just $5 a week, you’re out $94,900 a year ($5 x 52 weeks x 365 days = $94,900)! If you’re a service business, you’re losing 15-20 percent of your customers every year. So the actual loss is huge and growing persistently over time.

At the heart of customer defection is lack of satisfaction. This isn’t the same as dissatisfaction, which means an active dislike for something. Lack of satisfaction is simply the absence of any good reason for a customer to stick around.

Do you remember that U.S. News and World Report statistic I gave you? A whopping 91 percent of customers who leave do so simply because they are not satisfied.

How do you satisfy customers and retain their business? Any number of ways.

But since all relationships are based on good communication, that’s a commonsense place to start. Specifically, this means asking questions, staying in touch, and being generous.

Step 1: Ask Questions

People almost never tell you when they like something and only occasionally complain when they don’t. So the only way you’ll find out what you’re doing right or wrong is to ask your customers.

Ask directly with a short questionnaire, a comment card in your fulfillment, a phone survey, a feedback form on your website, or whatever it takes to get answers about the good and bad of your customers’ experiences.

Keep the lines of communication open with a dedicated, toll-free customer service phone line and a special customer service email address. Feature this information in your store and catalog; on your website; and in invoices, emails, and all customer communications.

Staff your customer service department with well-trained people. When you get complaints, solve problems promptly, give customers something for their trouble, and remind them that you care.

And, since people move, get married, have kids, and constantly change, you must keep your database fresh. Only when you know the who, what, when, where, why, and how of your customers’ purchases will you be able to fix problems and improve service.

Step 2: Stay in Touch

They say that absence makes the heart grow fonder. However, in marketing, familiarity makes the heart grow fonder.

A simple, inexpensive newsletter may be all you need to maintain a friendly familiarity with your customers. It can include information about new products and services, company policies, helpful articles, and anything that may be interesting, relevant, and useful. Just make sure it isn’t a bunch of thinly veiled advertisements. People will see right through that.

Letters and emails are great ways to thank customers for their business and reward them with special offers and inside information. For your top customers, consider a personal phone call just to say thank you.

Of course, a regular stream of offers also works, though you’ll lose a little of the bonding effect of more personal contacts. If you can tailor your offers to a customer’s buying habits, this can be effective. Some online companies, such as Amazon.com, do this quite well, combining targeted offers with a personal feel.

Step 3: Be Generous

People are willing to pay for quality. But don’t nickel and dime them to death.

A while back, I bought a relatively expensive computer. At the conclusion of an otherwise topnotch sales experience, the salesclerk asked if I would like a mouse pad. I said, “Yes,” only to have the clerk say, “Okay, that’s three bucks.”

It was a nice mouse pad, but after spending thousands of dollars for a computer, monitor, and several accessories, that extra $3 felt like an insult.

Little acts of unexpected generosity can go a long way toward cementing your relationship with customers. Free floor mats with a car, a free DVD with a DVD player, a free light bulb with a lamp, free advice with completed tax returns. Little extras make your customers feel that you’re a friend, not just another company out for a buck.

For more information on “generous” marketing, read Harnessing the Power of Kindness in my Learning Center.

In the end, business is more than sales. It’s about relationships. If you develop and nurture those relationships through a commonsense communication program, you can reduce customer defections, increase customer retention, and boost your profits dramatically.

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1. Customer defection: the leaky pool nightmare
2. Free shipping: Does it actually boost sales?

Many years ago, I lived next door to a guy named Wayne. Wayne had a pool. It was his pride and joy.

Trouble was, Wayne’s pool leaked. Slowly and persistently. We knew where the water was going, because the area under my deck was muddy all the time. But we didn’t know where the leak was.

All Wayne could do was run a hose to the pool to constantly replenish the water that disappeared. His water bills were outrageous.

It’s almost funny, until you realize that if you run a business, you’re in the same situation as poor Wayne. Your customers are leaking away. Slowly and persistently.

You probably don’t know where the leak is. And the cost of replenishing your pool of customers is almost certainly more than you want to spend.

We’re talking about “customer defection.”

If you’re a typical service business, you’re losing 15 to 20 percent of your customers every year. And according to a study in Harvard Business Review, ” … customer defections have a surprisingly powerful impact on the bottom line. They can have more to do with a service company’s profits than scale, market share, unit costs, and many other factors usually associated with competitive advantage.”

Customer defection is a nightmare because it significantly affects your bottom line.

Let’s say you lose just one customer who spends a mere $5 a week. That means you lose $260 a year. Not much. But if you lose one such customer every day, you’re looking at an annual loss of $94,900 by the end of just one year ($5 x 52 weeks x 365 days = $94,900). And the loss is progressive.

The question is, why do customers defect? According to a U.S. News and World Report article, out of every 100 customers who jump ship, 9 do so because they move, 9 because they go to the competition, 14 because of poorly handled complaints, and 68 for no special reason.

In other words, 91 percent of your lost customers leave simply because they aren’t satisfied.

How do I arrive at that? Well, you aren’t satisfying people if they go to the competition (that’s 9 percent). You aren’t satisfying people if they feel their complaints aren’t handled properly (that’s another 14 percent). And you’re not satisfying those who leave for “no special reason” because, while not specifically unhappy, they haven’t been given a good reason to stick around (that’s the final 68 percent for a total of 91 percent).

Okay, that’s all well and good. But how much can you actually add to profits by retaining customers? According to the Harvard Business Review study I mentioned earlier, you can increase profits up to 100 percent by retaining just 5 percent more customers! The calculation here is more complicated, but it comes down to the “lifetime value” concept.

At first, a customer does a little business with you. Over time, as the customer’s confidence in you increases, the customer’s purchases increase in number and value.

And as purchases rise, your operating costs decline, since your experience with that customer makes the relationship more efficient. Plus, the word-of-mouth advertising the customer does for you brings in many more customers.

The figures work a little differently for each business, but they’re impressive.

One auto service chain increased profits 30 percent by retaining an additional 5 percent of its customers. An insurance company increased profits by 50 percent. And a bank boosted profits by 85 percent.

That’s why they say, “Your best prospects are your own customers.” It’s not just that they’re easier to sell to. It’s that they add far more to your bottom line than new customers.

Okay, so let’s summarize …

Customer defections reduce profit. Customers defect because they aren’t satisfied. Therefore, if you satisfy your customers, you’ll reduce defections and increase profits.

But how can you satisfy customers? Specifically what can you do to make customers so happy they would never think about doing business anyplace else?

Whole books have been written about customer satisfaction, and there are a million things you can do. But the place to start is with simple customer communications. By knowing more about your customers, letting them know more about you, and giving them ongoing special attention, you can plug the leak in your pool of customers and start increasing profits today.

Don’t worry. Starting and maintaining a customer communication program isn’t as hard or expensive as it sounds.

In the next post, I’ll give you a simple, three-step customer communication program that you can tailor to your own needs and budget.

Stay tuned.

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All of us who work in the direct marketing industry have been affected by the economy.

In fact, the economy has affected pretty much everyone in advertising, publishing, or media.

So, last year, when the pain really started to set in, I decided to write a white paper to provide my take on the situation and provide some sound advice on dealing with it.

The results was Getting Response in a Down Economy: 4 Key Principles to Boost Your Direct Mail Profits in Today’s Difficult Market.

In just under five pages, I reveal the challenge of today’s market, what’s really happening out there, 6 key truths about your customers, the hidden opportunities of a down market, how to get your mind right, and the four key principles to improve response to your marketing efforts.

I then spend the rest of the 37-page report providing simple, actionable tips and resources for surviving (or even thriving) in today’s marketplace.

Here’s a quick excerpt:

Understand Your Customers

Each morning when you wake up, say this five times: “It’s ALL about psychology.” This is true for the economy and it’s the key to direct response advertising as well. Your customers are uncertain and afraid, but they are still essentially the same customers you’ve always had.

All the same psychological principles apply, though some are now playing a more prominent roll. By understanding this and allowing this knowledge to guide your selling strategy, you can give yourself a powerful advantage now and in the boom years to come.

• People love to buy. They love to discover wonderful new products and experiences. In America, and increasingly around the world, people see commerce as a natural and appealing activity.

• People make buying decisions emotionally. They decide based on a feeling, need, or emotion. That’s why intangible benefits are generally the key to persuasion. For any given promotion, you should ask yourself, “What is the emotional hot button here?”

• People need to justify decisions logically. While people make emotional decisions, they justify those decisions with logic and facts. You should always give people the appropriate justification for making a purchase.

• People want to avoid risk. People pursue gain, but the urge to avoid loss is more powerful because it works on a more basic level. In direct marketing, people usually can’t see you or the thing you’re promoting before they part with their money. So there is always a level of distrust and suspicion you must overcome.

• People seek value. Value is not a fixed number. It is a subjective relationship between the thing you are selling and what people perceive its worth to be. The greater the value relative to the price, the more likely people will respond to your offer.

• People buy direct because of convenience and exclusivity. Don’t fool yourself. If your customers could easily find the things you offer at a nearby store, that’s probably where most would buy them because the perceived risk is lower.

Has any of this changed? No. People are still people.

However, while a well-written headline and eye-catching photo can still make someone want what you’re offering, your customer’s fear and logic circuits are now operating on overdrive. They need stronger justification and greater value than ever before. They also need more assurance that their financial risk is minimal or even that the purchase will save them money.

These aren’t foreign concepts. We know these ideas well. Today’s market simply requires more attention to them than when the marketplace was flush with cash.

So if you are savvy enough to sell with one set of psychological conditions, you are savvy enough to sell with another set. In fact, as a direct marketer, you are better equipped to adapt to these modified conditions than virtually any other type of business.

Click here to download the entire white paper.

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I like to snack on cereal. And I buy a different brand every week.

However this personal indulgence comes at a price. When I enter the cereal isle, I’m faced with a wall of boxes vying for my attention, starbursts popping off every box, coupon dispensers flashing red, sales signs waving above my head, red and yellow price tags lining every shelf, a sea of promotional decals spattering the floor.

It’s information overload at its most intense.

I’m sure I don’t have to explain information overload. You experience it every day when you open three pounds of mail, flip through 1,000 TV channels, or dive into that teetering pile rising from your “in box.”

There’s just too much information to process these days. And what I feel in the cereal aisle is what your customers and prospects feel every day. What are the results? When people are feeling overwhelmed, they react in the only way they can:

• They skip over or set aside difficult information for another time; or
• They filter out difficult messages and look for ones that are easier; or
• They try to deal with the information, but make mistakes that prevent them from responding in the way you want; or worst of all
• They ignore your message completely.

The Causes of Information Overload

You can’t do anything about the general information overload in our culture, but you can control overload in the context of your marketing messages. First, let’s look at what can create information overload in your communications.

Lack of clarity. When a person does not understand something, information is nothing more than random data. Even short messages can overwhelm people if the meaning is not clear.

In advertising, this is often caused by too many writers working on a single project — a sure way to muddle a message. It is also caused by regurgitating facts without understanding them, by not having a tangible purpose for writing, and by striving to impress rather than communicate.

Semantic distortions. The word “semantic” refers to the meaning of words — not just the dictionary meaning but the total meaning as interpreted by a reader or listener. This can vary widely depending on education, experiences, and beliefs.

You must always ask questions about the perceived meaning of your messages: Do your words say what you intend them to say? Is your headline too clever? Do you get lost in a narrative? Is your tone too upscale? Do you spend too much time on the problem and not enough time on the solution? Do your illustrations match the product?

Poor retention. Generally, direct marketing is more concerned with immediate decisions than image-building or branding. However, it’s beneficial for people to remember favorable facts about your business.

Do you make the impression you want to make? Do your prospects hear you? Understand you? Even loyal customers or donors seldom remember much about you. You must continually educate them.

Poor planning. Have you thought this through? Is this the best time for your pitch? Is this the best offer? Are you using the best lists? Do you have the best placement? Are you appealing to the best markets? Even the very best copy cannot overcome faulty planning.

Distrust. People are by nature suspicious. Evolutionary biologists have even said that one of the primary functions of the human brain is to be a “cheater detector.”

You might bend over backwards to be honest, but do people believe you? Are you open and generous with information about your organization? Do you offer a fair guarantee? Do you carefully describe your product or service or programs? Are there drawbacks you should point out? In marketing, you are often guilty until proven innocent.

The Cures for Information Overload

So, what can you do to avoid overload? Allow me to address the causes with some cures and give you a few extra ideas as well.

Make clarity your #1 objective. You can’t persuade someone to act if that person doesn’t understand your point. Simplify your message. Make it easy to read or understand. Say what you mean to say. Good ad messages should be like a clean pane of glass in a storefront — you don’t notice the glass, but you can clearly see what you want on the other side.

Link information with familiar ideas. If there’s any chance for misunderstanding, use a simple analogy to something your prospect is already familiar and comfortable with. For example, if you say your software utility program is like a doctor checking your computer for viruses and other software “illnesses,” it’s easy to understand what the program does.

Inject emotional content. Ideas are easier to understand and remember when they are linked with emotional content or intense feelings.

If you’re raising funds to change the American tax system, don’t just explain economic theory and reel off dry statistics. Talk about how the IRS takes money from our wallets, how the government makes us work two hours every day to support a bloated government, or how frustrating it is to fill out all those confusing forms every April. People process emotional ideas more easily than intellectual ones.

Avoid making counterproductive associations. Clever analogies, puns, and word play might make you look bright, but they will sabotage clear communication. This goes for gratuitous graphics, effects, and images that are used because they are trendy.

One ad I have in my “bad ad” file shows a clown giving work to a guy sitting at a desk. The headline makes a pun about the boss being a clown. You have no idea this ad is about office equipment until you read the tiny body copy.

Avoid interfering messages. Don’t dump too many messages on your reader at once. Start with a simple, big idea. Then build and reinforce, adding information paragraph by paragraph, always talking about that one big idea.

Use unique or unusual messages. Messages that stand out are noticed and remembered. You should always try to do something just a little different — different from the competition or different from the norm — in every message. If the product itself is unique, let that come out and don’t camouflage it in an unnecessarily creative approach.

Present product benefits at the beginning and the end of your message. People tend to remember what comes first and what comes last. Things in the middle are usually forgotten. If you have a list of benefits or features, put the best up front, but have a few good ones for the end, too. And in any communication, reiterate the primary benefits when you’re wrapping up your pitch.

Create meaningful messages. Empty hype is soon forgotten. Copy based on prospect needs is remembered and acted upon. If you find yourself struggling for words when writing copy, you’re probably lacking meaningful content. Dig a little deeper and find tangible things to say.

Present clear benefits of using your product. A list of cliché benefits won’t rouse many people to action. “Low prices. Quality service.” That says nothing. Give clear, tangible benefits that are meaningful and valued by your prospect.

Decide what you want to say before you say it. Don’t just write hoping that something sensible will reveal itself. Plan and outline. Think about the point you want to make. Determine the tone or emotional feel. Know where you’re headed before you start.

Increase the reward for reading and involvement. People always ask, “What’s in it for me?” Give people useful information. Make it interesting, though not necessarily entertaining. Your message is probably unsolicited, so give people a good reason to read, listen, or watch.

Prove your trustworthiness in tangible ways. Make your intention clear. People not only ask, “What’s in it for me?” They also ask, “What’s in it for you?” Tell them. Also, speak the same language as your prospect. Flatter but don’t lecture. Speak to your prospect’s needs. Show you care. Give a fair price. Educate, inform, and uplift. Give something away to prove yourself.

Now, if you’ve had an “overload” day, it’s quite possible that all these ideas and bullet points are sounding like just so much noise. So, let me try one more time.

Imagine I am your customer. As I shop your “cereal aisle,” I want to feel like I can choose, but I really want you to give me just one clear choice. I want to know what I’m getting. I want to feel like it’s a bargain. I want the whole process to be easy and fun. I want what’s inside to look the same as the picture on the box.

And I’d appreciate it if you would toss in a prize.

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Offers are an essential part of direct marketing and are at the heart of direct response advertising.

And few offers these days are as popular as free shipping.

Free shipping is often recommended by direct marketing gurus as a way to boost orders, but does this offer really work? It depends on who you ask. It seems to work for some and not for others.

A client recently ask me about free shipping, saying that it was getting harder to make it profitable. I didn’t have the answer and had a hard time finding any good data on this, but Marketing wizard Ted Grigg came through and directed me to an article about informal research on free offers from F. Curtis Barry & Company.

Remember that this information is from late 2008, so it’s possible something has changed since then, though I doubt it.

Here are some highlights:

• Around 80% of all major businesses offer free shipping during the Fall and Holiday season.

• Most free shipping offers are tied to a minimum order.

• Success with free shipping varies widely from one company to another.

• Free shipping seems to work better with products that can be shipped at a low cost.

• Shipping costs have been going up, making it harder to justify a free shipping offer.

• Conditioning customers to expect free shipping may be a counterproductive strategy.

• 50% to 70% of customers are one-time buyers, which raises further doubts about the benefits of free shipping.

Before reading this report, I had assumed that free shipping worked, given the frequency of this offer. But now I’m thinking that free shipping might be a little like sweepstakes, where the offer often pulls more orders but creates the risk of attracting low-value customers and creating a downward profit spiral that’s hard to escape.

As in all cases, testing is the only way to see if free shipping works for you, though according to the F. Curtis Barry & Company report, measuring results may be harder than it sounds.

Have you tested free shipping lately? Is it working for you?

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Who would you say is the greatest marketer in history? Some might suggest Henry Ford or Montgomery Ward. Others would point to Ray Kroc or even Bill Gates. But I would suggest another person, someone whose efforts surpass these giants.

His name is Santa Claus. And he operates the oldest and most successful toy and gift manufacturing and distribution business in the world. I’m sure you’ve heard of him. In fact, I’m sure that you were once a loyal customer. Virtually everyone is at one point or another, which just proves how successful he really is.

How has he done it? Not by magic, I assure you. Santa has simply applied common-sense marketing principles in order to grow and maintain his successful business.

• Niche Market — Santa’s customers are kids. Period. He knows that trying to expand into the adult or senior market may prove lucrative at first, but it would weaken the strength of his brand. This is not to say that Santa doesn’t run other businesses. His reindeer training seminars and North Pole real estate ventures have been quite successful, though his weight-loss products haven’t fared as well. The point is that Santa, Inc. consistently focuses its energies on its core market year after year. When Santa sees other business opportunities, he creates entirely different brands.

• Careful List Management — Santa’s customer list is second to none. He doesn’t just make the list; he checks it twice. Everyone’s name is spelled correctly. Addresses are correct. Duplications are eliminated. He adds value to his list with additional information related to past orders and customer behavior, such as when they’re sleeping, when they’re awake, when they’ve been bad or good, and so on. Santa knows that his list is more than delivery addresses; it’s his most important business asset.

• Great Products — Santa started out years ago as a one-man toy manufacturing company. And right from the beginning, he knew that quality was key. You can certainly unload shoddy merchandise and stay afloat, but you can’t build a truly successful company that way. Over the years, he has expanded his product line to include the newest and best toys from factories all over the world. However, he avoids the sort of inferior merchandise so often favored by a kid’s cheap relatives. When you think “quality and selection,” you think Santa Claus.

• Fair Prices — A glass of milk and two cookies is the going rate for most gifts. For computers and other high-priced items, you may want to add another cookie. He doesn’t gouge. He doesn’t hide profits in bogus shipping and handling charges. Santa knows that while it takes years to dominate a market, just a few greedy mistakes can irritate even the most loyal customers and eventually invite competition. So he keeps things affordable, consistent, and honest.

• Savvy Promotion — Talk about guerrilla marketing! Songs, stories, movies, cards, poems, in-store displays, gift wraps, lawn ornaments, tree decorations, you name it. Santa keeps his promotion costs low and his return on investment high. His image and message is everywhere during the holidays. The red suit gives him a unique look. The “ho ho ho” is the world’s most successful catch phrase.

• Easy Ordering — Just write a letter detailing your gift selections and mail it to the North Pole. Simple as that. You can also place your order personally in many stores and malls if you don’t mind waiting in line. And these days, you can even contact Santa via email. Santa knows that ease of ordering is one of the keys to any successful business.

• Fast Fulfillment — Move over FedEx. Santa is able to deliver billions of gifts to homes all over the world in just one night. His system is proprietary and how it works is a mystery. Suffice it to say that Santa understands how disappointed a customer would be if just one item arrived late. So he doesn’t make excuses about out-of-stock merchandise or ordering snafus. He gets it right and delivers on time every time. And his customers love him for it.

• Continuous Acquisition — Santa has turned customer retention into an art form. Satisfaction is so high, once you’re a customer you remain a customer. And when children grow up and move out of the core age range, these adults help assure a fresh influx of new customers by encouraging their children to buy into the Santa phenomenon. Call it customer-get-a-customer or viral marketing or whatever you like, but it works.

And by the way, while Santa focuses on his core kid market, he really doesn’t turn anyone away no matter how old. So if you haven’t placed an order in a while, try it. You may be pleasantly surprised.

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Some time ago, I did an interview with Senior Market Advisor, a publication that gives advice on selling insurance, annuities, and long-term care insurance to the senior market.

The interview focused on direct marketing techniques and I thought you might enjoy reading it.

What kind of message works best when you’re trying to get prospects to fill out the reply part of a mailer?

The reply is the moment of truth, and you don’t want people to have any doubts about what they’re asking for or getting into.

So briefly restate the offer and benefits. This can take the form of a “statement of acceptance.” If you think of direct mail as a dialog between a business and a consumer, then the reply is where the customer “speaks” back to the person who sent the package.

Your statement of acceptance should include an affirmation, benefit statement, request for the item, summary of the offer, sweeteners, and a guarantee.

For a direct order, it could work like this:

Yes! I want to cut my taxes in half. Please send my copy of How to Instantly Cut Your Income Tax for just $29.95. And if I respond by January 12, I’ll also get the TaxSlash computer program FREE (a $39.00 value). I understand that if I’m not completely satisfied, I can return the book for a full refund — but I’ll keep the computer program as my gift.

For lead generation, it can be much simpler:

Yes! I want to cut my taxes in half. Please send my FREE copy of How to Instantly Cut Your Income Tax. I understand there is no cost or obligation.

Whenever possible, the reply should be a separate piece. This helps people notice it. And it avoids the psychological aversion many people have about ripping up materials they may want to keep.

However, if the reply is attached to something, it must be prominent, perforated, and easy to tear out. Reply forms attached to letters work well, as do perforated reply forms in simple self-mailers. And a bind-in reply card for print ads almost always boosts response.

A lot of people try to cram as much information as possible into small spaces, but this seems to make reading difficult. When you’re dealing with limited space, what is essential and what can be omitted?

Basically, direct response advertising requires only 3 things:

1. Make an offer.
2. Include enough information to accept the offer.
3. Provide an easy means of responding to the offer.

Everything else is an enhancer of some kind.

Generally, most businesses talk way too much about themselves and not enough about the wants, needs, and concerns of their prospects. So if your promotion sounds like an autobiography detailing the entire hundred year history of your company, start cutting. No one cares about your company but you. People care only about themselves.

How do you introduce concepts like annuities ­ or other topics that a client may not completely understand ­ and expect a response?

There’s an old saying: “People don’t want drills, they want holes.” Likewise, no sane person wants to talk, think, or read about financial products.

YOU may be fascinated with annuities, for example, but the average person’s eyes will glaze over the moment you start talking about them. Instead, discuss what THEY are interested in … protecting their hard-earned money, getting a better interest rate than the bank offers, having reliable income for life, etc. Then simply make the annuity a way to achieve these things simply and easily.

Plus, you really need to educate people with simple, clear brochures, booklets, reports, and other items. Offer them free, get a response, and start an ongoing relationship with people. Smarter prospects are better prospects.

How should text be laid out? What should be emphasized?

Seniors are readers. So design text to be read, not just looked at. All the usual good design rules apply: bold headlines and subheads, generous white space, narrow columns, serif type that’s big enough to read without eyestrain, and nothing too progressive or artsy. Don’t take your cue from anything that wins an award. Look at high-circulation magazines and see how the type is laid out.

Is color worth the money? Full color? Spot color?

Photos are usually better in color. But in the hands of a good designer, a two-color piece can often look as good or better than a four-color piece. It really depends on what you’re trying to accomplish. Generally, the simpler the better.

What type sizes and colors work best?

At about age 40, eyes begin to deteriorate. By 60 there’s some degree of impairment even in healthy eyes. Specifically, the lens becomes more rigid, eye muscles weaken, and the cornea yellows. The result is that older eyes can’t focus as well on small type, can’t perceive colors as distinctly, and generally see a somewhat dimmer world.

So for older prospects, it’s wise to use type that’s no smaller than 12 points. Also more use of large, simple graphics can help convey messages more easily. Blue and green become harder to distinguish with age, and yellow becomes trickier to use for eyes that see everything a little more yellow. Colors with more contrast, such as black, white, and red, are a safer bet.

What about art, photographs, or illustrations? What should they depict?

Artwork should always link directly with what you’re selling and telegraph your message. Don’t use photos as a crutch or random design elements. Don’t use clever pictures thinking that you’ll arouse curiosity. If a mature audience can’t make sense of your mailing instantly, they’ll trash it.

Nix the pix of blue-haired ladies in rocking chairs and bald men playing checkers. Many of today’s seniors are active and vibrant, or at least like to think of themselves that way. Show people as they wish to be not as you see them. Help people recapture their youth and you’ll win a friend forever.

If you’re on a limited budget, where should you cut corners?

Format, size, and number of pieces are areas where you can save. If a direct mail package is too expensive, try a self-mailer. If your mailer is too big or heavy and the postage is high, try a smaller or lighter version. If you have 6 pieces in your package, try removing one or two and see how it affects response. If you have a good sales letter, you can often remove a brochure without hurting response. You can try two-color instead of four-color.

Also, prices vary widely among printers and lettershops, so consider what you actually need and hire the vendor who can most efficiently get the job done.

How important is quality of paper?

For most promotions, standard paper choices are fine. Fancy, expensive papers are seldom a good investment unless you’re trying to achieve a special effect. You’re probably better off focusing on strong copy and irresistible offers.

What are the keys to addressing older clients through direct mail? What does this market respond to?

Some general advice …

Don’t call seniors “seniors.” People who are 50 plus don’t think of themselves as seniors and calling them that will just insult them. Likewise, never use the words “old” or “elderly.”

Sell to people not stereotypes. A 60-something business executive isn’t the same as a 60-something retiree. Know who you’re selling to.

Be direct. Really direct. They’ve seen it all and won’t respond to cliches or empty patter. Focus on benefits. Keep it simple and clear. Make it tangle. Get to the point fast.

Don’t use pressure or scare tactics. You may capture some of the low-hanging fruit, but the rest will remain out of your grasp. Instead, educate them and build a relationship. Information sells. Trust is everything.

Emphasize your credibility. Testimonials, research, endorsements, years in business, and other proofs help show that dealing with you isn’t a mistake.

Remove risk. Seniors like to try new things, but they don’t want to risk anything. Try free trials, money-back guarantees, an emphasis on customer service, and any tactic to reduce perceived risk.

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Testimonials have been a powerful advertising tool for generations. But now the FTC is stepping in to rewrite the rules for how you can use testimonials and endorsements.

While I’m not clear on how this will shake out, the press release issued by the FTC doesn’t look pretty.

The guidelines will not only affect the testimonials used in ads, they will also affect consumers, experts, bloggers, organizations, and celebrities who endorse products.

Here a few excerpts:

Under the revised Guides, advertisements that feature a consumer and convey his or her experience with a product or service as typical when that is not the case will be required to clearly disclose the results that consumers can generally expect.

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The revised Guides also add new examples to illustrate the long standing principle that “material connections” (sometimes payments or free products) between advertisers and endorsers – connections that consumers would not expect – must be disclosed. These examples address what constitutes an endorsement when the message is conveyed by bloggers or other “word-of-mouth” marketers.

…

Celebrity endorsers also are addressed in the revised Guides. While the 1980 Guides did not explicitly state that endorsers as well as advertisers could be liable under the FTC Act for statements they make in an endorsement, the revised Guides reflect Commission case law and clearly state that both advertisers and endorsers may be liable for false or unsubstantiated claims made in an endorsement – or for failure to disclose material connections between the advertiser and endorsers.

The press release says these guidelines are ” … administrative interpretations of the law intended to help advertisers comply with the Federal Trade Commission Act; they are not binding law themselves.”

Maybe. But it certainly indicates where the law might be going and that it may become significantly harder to use testimonials, even honest ones.

What do you think? Will this merely clean up unethical practices or will it stifle an effective selling tool?

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Do you know what a bingo card is? How about a buck slip. Or a bangtail? (Get your mind out of the gutter!)

These terms may sound mysterious, but they’re just part of the official language of direct marketing. That’s probably why one of my most bookmarked pages is the Glossary of Direct Marketing Terms.

Here are some of the most interesting terms from the glossary:

Bangtail – Return envelope with a reply form attached to the flap. The reply form tears off and is returned in the envelope. Also referred to as a “hot potato.”

Bingo Card – Reply card in a publication offering an easy means to request information from advertisers whose ads appear in the publication. Called a “bingo card” because it is often covered with numbers corresponding to offered information, making the card look similar to a card used to play bingo.

Buckslip – Small piece of paper inserted into a direct mail package to emphasize certain information.

Decoy – Name included in a mailing list to catch people who disregard the terms of the list rental agreement.

Johnson Box – Type of headline at the top of a letter, originally set in a box with solid borders or a border made of asterisks. Named for the inventor, Frank Johnson.

Magalog – Direct mail sales format that looks like a magazine or catalog.

Nixie - Mail piece returned by the post office because the address is not deliverable.

Overline – Headline above the main headline, usually in smaller type. It can be part of the headline or an introductory statement.

Rollout – Mailing to the rest of a mailing list after testing the mail piece on a smaller sample of that list.

Spoofing – Masking a sender’s e-mail address with a fake address to make the recipient think the message is from a trusted source.

Take a look at the glossary and bookmark it for reference. Is there another term you think should be in the glossary? Tell me.

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Bob Stone has been called one of the founders of modern direct marketing. He had the ability to understand both the big picture of marketing and the finer details of selling tactics.

Here are 30 timeless direct marketing principles he discovered over the course of his long career:

1. All customers are not created equal. Give or take a few percentage points, 80 percent of repeat business for goods and services will come from 20 percent of your customer base.

2. The most important order you ever get from a customer is the second order. Why? Because a two-time buyer is at least twice as likely to buy again as a one-time buyer.

3. Maximizing direct mail success depends first upon the lists you use, second upon the offers you make, and third upon the copy and graphics you create.

4. If, on a given list, “hotline” names don’t work, the other list categories offer little opportunity for success.

5. Merge/purge names — those that appear on two or more lists — will outpull any single list from which these names have been extracted.

6. Direct response lists will almost always outpull compiled lists.

7. Overlays on lists (enhancements), such as lifestyle characteristics, income, education, age, marital status, and propensity to respond by mail or phone will always improve response.

8. A follow-up to the same list within 30 days will pull 40 to 50 percent of the first mailing.

9. “Yes/No” offers consistently produce more orders than offers that don’t request “No” responses.

10. The “take rate” for negative option offers will always outpull positive option offers at least two to one.

11. Credit card privileges will out-perform cash with order at least two to one.

12. Credit card privileges will increase the size of the average catalog order by 20 percent, or more.

13. Time limit offers, particularly those which give a specific date, outpull offers with no time limit practically every time.

14. Free gift offers, particularly where the gift appeals to self-interest, outpull discount offers consistently.

15. Sweepstakes, particularly in conjunction with impulse purchases, will increase order volume 35 percent, or more.

16. You will collect far more money in a fund-raising effort if you ask for a specific amount from a purchaser. Likewise, you will collect more money if the appeal is tied to a specific project.

17. People buy benefits, not features.

18. The longer you can keep someone reading your copy, the better your chances of success.

19. The timing and frequency of renewal letters is vital. But I can report nothing but failure over a period of 40 years in attempts to hype renewals with “improved copy.” I’ve concluded that the “product” — the magazine, for example — is the factor in making a renewal decision.

20. Self-mailers are cheaper to produce, but they practically never outpull envelope enclosed letter mailings.

21. A pre-print of a forthcoming ad, accompanied by a letter and response form, will outpull a post-print mailing package by 50 percent, or more.

22. It is easier to increase the average dollar amount of an order than it is to increase percentage of response.

23. You will get far more new catalog customers if you put your proven winners in the front pages of your catalog.

24. Assuming items of similar appeal, you will always get a higher response rate from a 32-page catalog than from a 24-page catalog.

25. A new catalog to a catalog customer base will outpull cold lists by 400 to 800 percent.

26. A print ad with a bind-in card will outpull the same ad without a bind-in up to 600 percent.

27. A direct response, direct sale TV commercial of 120-seconds will outpull a 60-second direct response commercial better than two to one.

28. A TV support commercial will increase response from a newspaper insert up to 50 percent.

29. The closure rate from qualified leads can be two to four times as effective as cold calls.

30. Telephone-generated leads are likely to close four to six times greater than mail-generated leads.

Related posts:

1. Customer defection: the leaky pool nightmare
2. Design and legibility: 10 basic principles of reading
3. Santa’s secrets of marketing success