Staying the Course during the Tough Times in Membership Marketing

In its annual survey, Direct magazine found that 45% of responding companies projected to increase their direct marketing spending this year while only 7% planned to decrease marketing spending. This was despite the fact that only 25% of responders anticipated their direct marketing margins to increase this year.[1]

In other words, these companies are choosing to sail into the head wind. How does Direct explain this? They say,

“In hard times direct marketers usually mine their customer base and leave prospecting for better days. So why are DMers, and especially consumer marketers boosting prospecting budgets? One reason is that house files have to be replenished regardless of the economic conditions.”[2]

Is there a lesson in this for non-profits? I think that there is.

Adding new members and customers is essential for growth. Therefore, no matter what the economy throws at you, retreating really is not a solution. Staying aggressive and finding ways to market smarter is the best course of action.

Here is one real world example of an organization that I admire. It is a trade association serving small businesses. They recently launch a membership campaign to acquire new members. They tested six mailing lists split over four direct mail packages. Overall the promotion generated only about 30% of projected returns. Many groups would give up at this point.

But buried deep within the responses that did come in were some golden nuggets. One of the four test packages actually made a profit. And within that package two of the lists did particularly well. The association’s decision on future marketing: let’s press forward and test more to find the keys to additional response.

If you declare that growth is your only option as an organization, then giving up is simply not acceptable. Instead, lack of response is your call to working harder and smarter.

[1] Direct, June 2008, p S 4 and S 10.
[2] Direct, June 2008, p1.


Don Metznik said...

This supports my belief in the value of testing, and, more specifically, in the value of any test that is properly constructed, administered, and evaluated. Whenever you learn something from the marketplace, even if it is about what doesn't work, you have an asset that can be cashed in the future. There have been many times when I've turned to lessons learned in "failed" tests, and have applied them productively in unexpected future situations.

Tony Rossell said...

Don -- Amen. We find that it is not uncommon to have a 1,000% variance between the very best list, offer, message, and package in a marketing campaign compared to the worst. We would not know what worked and what did not work without testing. Here is a link to some additional posts on market testing:

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