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4 Trends That Could Lead to Growth

We reveal four marketing trends likely to get hotter in 2010 - and show you how they can work for brands of any size.

With the direct marketing industry in the grip of a series of upheavals, from the digital revolution to the economic meltdown, figuring out what's coming next is becoming progressively more difficult. Creating effective strategies based on these expectations is the toughest part of all.

And so, faced with one new challenge after another - from increasing costs for production and materials to rising environmental concerns among consumers - marketers have intensified their push to get ahead of the industry curve. This has led to a massive scramble to determine where the most significant industry trends for next year will emerge.

To help, Deliver® sat down with experts from around the country to attempt to divine what's in store for direct in 2010. While a number of potential trends were discussed, there were four key areas - targeting, measurement, channel integration and prospecting among baby boomers - that kept coming up as likely hot spots for growth and innovation.

As a result, we decided to take a closer look at these four fields and what possibilities they hold for marketers in the coming year.

1. Targeting

If there's a one-word formula for marketing success next year, it's precision, industry leaders say. Traditionally, of course, the trend has been toward amassing as much information as possible about prospect and customer groups, then bombarding them with offers. But that approach is no longer viable.

According to a recent Winterberry Group report, the organizations struggling hardest are those that have depended most heavily on batch blast-style mailings - that is, using the mail as a saturation tool with little or no regard for rich personalization or the particular needs of the individual recipient.

Liz Miller, CMO Council vice president of programs and operations, sums up the trend: We're moving away from saying, "I want to connect with women who are 34 to 54" to "I want to connect with that particular woman."

Such customized approaches are already possible, but to date, have typically included only recipients' names and, in some cases, their locations. But, Miller says, continuing advancements in database management and variable data printing (VDP) have industry experts predicting more robust personalization techniques in 2010.

Backroads, an active- and adventure-travel company, is already learning the value of tightly focused personalization, especially for generating repeat business. The organization uses automated marketing engine technology from Nimblefish to mail thousands of postcards to past customers that contain not only personalized messages but also photos of regions recipients have traveled to in the past. The message might say, 'Barbara, remember Yellowstone in May 2002? Have another memorable trip - and here are three options,' says Massimo Prioreschi, vice president of sales and marketing for the Berkeley, Calif., company.

Miller says these kinds of highly tailored mail pieces offer a good glimpse of the direction that targeting will continue to take in 2010. That's going beyond just putting one person's name on a piece of paper, she adds. It's saying, 'We want to give you everything that's relevant to you right now.'

2. Measurement/Analysis

While the need to tally ROI has always been essential to marketers, they are more pressed to prove that their campaigns are impacting consumers and generating revenue.

Experts predict that, as measurement tools become more precise, how brands measure the return on their investment is likely to become more complicated. They will have to pay attention to a broader range of data, and companies will have to work even harder to make sure that other parts of the organization operate in conjunction with the marketing department.

The CMO Council's Miller recommends organizations extend their ROI measurement to the entire marketing supply chain. Don't focus on the return at the expense of managing investment costs, she says. Map, track, measure and put a dollar amount on everything you do.

She adds that marketers also will have to improve customer experience, mostly by learning to better mine data. Businesses like Harrah's Entertainment - owners of 54 casino and hotel properties worldwide - know the value of the detailed data their programs generate. The company's mail-driven loyalty program, for instance, has allowed its marketers to collect and analyze data on how often program participants visit their properties, how much members contribute to overall gaming revenue and what games of chance they prefer, among other things.

In-depth analysis of members' behavior lets Harrah's construct more effective messages, says David Norton, senior vice president and CMO for Harrah's. If we know a player has been to past slot tournaments, we'll make sure he or she gets invited to the next one, he adds. If they've never come to a mid-week event, we exclude them from mailings about mid-week events because, obviously, they're not going to respond.

3. Integration

In 2010, improved integration of channels, such as e-mail, direct mail, billboards and TV, will become more of a focal point for even the most reluctant marketers. That's always been a goal, but the economy has made it imperative, CMO Council's Miller says.

And even though the past two years brought plenty of dire speculation about - and even premature eulogies for - the future of print marketing, the people who keep an eye on these things insist that traditional channels like direct mail will continue to earn their place at the marketing table in 2010.

The favorite thing to say in 2008 was that, in 2009, print would be dead because everybody was going to e-mail, Miller recalls. That didn't happen. Actually, both modes of communication took a hit during the past year.

For that reason, most marketers have found that online channels demonstrate greater value as a complement to direct mail applications, reinforcing the value of integrated programs, according to the Winterberry Group.

Backroads' Prioreschi says that postcard mailers his company sends also drive recipients to a personalized Web site with several highly targeted offers. If someone went to Yellowstone, Alaska and Glacier National Park, we know there's a definite pattern there indicating he or she is a mountain wilderness person, he adds. Thus, the personalized site might include offers for upcoming trips to the Canadian Rockies or Himalayas, complete with slideshows and videos.

Prioreschi says integration is working well. During one campaign, sales were 50 percent higher among people who received a postcard and clicked through to a personalized site than those who just visited the site on their own.

4. Prospecting

Since World War II, the 18 to 25 age range has been the sweet spot of American marketing. There was a good reason for that, says Dr. Ken Dychtwald, founder and CEO of Age Wave, a San Francisco research and consulting firm that specializes in helping companies market to older customers. Young people historically represented an area of growth because of their willingness to try new things. They were still forming their brand preferences. The idea was that if you captured their hearts at that stage, you had them for life.

And, of course, the postwar baby boom filled the sweet spot with tens of millions of potential young targets for marketers. Although the baby boomers have since aged, marketing experts say that, in many ways, they still represent a marketing sweet spot for industry innovators. Consequently, many in the industry are predicting a renewed focus on baby boomers in the coming year.

People should be swooning over the baby boomers as they move out of youth and into middle age, Dychtwald says. This is an age group that has traditionally been sidelined, but we're going to see growth in sectors catering to them.

Reinvention is normal for this generation, Dychtwald continues. They change careers many more times than their moms and dads did. They're willing to try new things. So if you think you can rest on your laurels - if you think you've got them for life - you're wrong. Today, everybody at every stage of life is open to marketing.

In courting boomers, he says, marketers also are reacting to another growing trend in marketing: the end of brand loyalty and the return to brand experimentation. People are more willing to try new brands than ever - and those over 50 years old are particularly open to these new messages, Dychtwald says. They're more likely than any other group to read and respond to catalogs and direct mail pieces, he adds, citing research from the Direct Marketing Association. They enjoy reading a good catalog and leafing through their mail looking for deals. Good pitches attract their attention. It's a mistake not to take direct marketing seriously for mature populations - and the time to start is right now.

Of course, the same could also be said about any of the other trends marketers are expecting to get bigger in 2010.

Author: Anne Stuart

Read other articles in this issue:

4 Selling Strategies to Focus on in 2010
8 Powerful Ways That Postcards Can Work For You
4 Trends That Could Lead to Growth

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June 4, 2020

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