Tuesday, May 13, 2008

Advertise For Less: Insert Media

bet you've been looking for such an opportunity, but you never thought about it. Here it is, you can finally advertise for LESS."

Why Should You Consider Shared Direct Mail?

Shared Direct Mail Advertising provides the same benefits of solo direct mail advertising for a fraction of the cost. Shared Direct mail advertising is a proven and cost effective way to advertise your offer to consumers and businesses. Smart advertisers are sharing the costs of postage, mail processing, mailing service, ad design, mailing lists and printing by combining their ads with several other advertisers into a combined mailing package which reaches a targeted audience. If you are a smart advertise and want to advertise for less then you need to consider shared direct mail advertising. Shared Direct mail advertising successfully reaches more than 98% of households, thus over 120 million households throughout the United States.

First-class mailers are still absorbing the harsh realities of the recent postal increase and a variety of advertisers are examining economic efficiencies of their methods of distribution. Every mailer should seriously consider their "options" and one such option is using shared direct mail.

In the last 30-plus years, the number of shared direct mail advertising programs also called inserts has risen dramatically, along with a variety of options being offered to the mailer. Lets examine the maze of insert opportunities in today's marketplace.

Package Inserts: These are free standing promotional pieces delivered to mail order customers via their fulfillment package; i.e. the insert is delivered to you in a box containing a shirt you ordered from a catalog. Naturally the product shipment types vary dramatically: catalog generated vs. space-generated, television or internet, continuity or club oriented, business-to-business vs. consumer. Correspondingly, the responses to the outside insert will also vary. The going rate for package inserts is still an average of $70/M. The number of outside inserts varies from four to eight. Generally, only non-competitive pieces are included together.

If one goes heavily into a club or continuity oriented program, the rate of duplication needs to be monitored. The response rates also vary significantly depending on a number of other variables: whether the insert is generating a lead or producing an order, the average ticket price of the items being sold, the size of the insert, etc. A large ticket item may be satisfied with two responses per thousand, whereas lead-generating devices having a strong affinity between the insert and the products being delivered would produce responses ranging from 1-3%.

The current universe exceeds seven billion and includes programs like Shopper's Advantage, America Online and Current. There are also scores of smaller programs and specialty companies like Zoysia Grass Plugs, Amazon.com Tools & Hardware and Wizard Entertainment.

Ride-Alongs: In this instance, a company mails a catalog, circular or announcement to its customer base and allows outside advertising to ride along. An advertiser can count on this method of distribution since the company doing the mailing has a vested interest in getting out their own promotional pieces. Companies like Columbia House dominate this category and offer regular mailings in blocks of 2MM-6MM to their club members.

Advertiser's response from this category is strong--comparable to package inserts. Average prices range from $50/M-$75/M. Outside inserts range from one to four per mailing. Response curves are similar to direct mail. These programs may be dying as they reduce their numbers of negative option mailings.

Co-op Mailings: This category, by definition, presents a group of non-competitive advertisers mailing to a common market. Co-ops represent large numbers (up to 40MM) in a single drop, can usually provide good geographic selectivity and often provide demographic selectivity as well i.e. new mothers, new movers, prenatal. Although responses are not as high as those generally received from packages, co-ops are priced more competitively, at an average of $25/M. Other co-op mailings include coupons from local merchants (i.e. dry cleaner, ice cream shop, oil change). These programs are usually sold on a local level by neighborhood franchises. Well known examples include Super Coups, Money Mailer and Mr. Coupon. Most of them are available in a #10 envelope format, but some mail in a 6 x 9 envelope. Circulation exceeds 100MM/quarter.

Statement Stuffers: These

mailings include invoices and statements generated by cable TV companies, utilities, credit cards, magazines, book clubs, continuity programs, retailers, businesses and so on. They are usually distributed in small envelopes so your insert needs to be no larger than 3-1/2 x 6 to fit. Outside inserts are generally limited to one or two since statements get mailed first class (high percentage of deliverability) and additional outside advertising would bump them into the next postal class. Response tends to be strong with average prices running at $60/M.

Sampling: This method of insertion offers a variety of goody bags distributed free to specific markets, i.e. college students, new mothers, buyers at retail and other special interest groups. Inserts accompany product samples and coupons. Some vendors are trying to qualify the recipients by requiring them to spend a certain amount, or purchase multiple products, or fill out a direct response vehicle before receiving the sampling bags or boxes. Packages are sometimes given out free in high traffic situations. Frequently, geographic targeting is also available. Pricing ranges from $35/M-$50/M.

Card Deck Mailings: This vehicle usually consists of 20 or more 3-1/2 x 5-1/2 business reply cards delivered in poly packs. Rate card prices average from $35/M to $45/M and include printing; still mostly business-to-business, a growing number of consumer card decks have come onto the market. Approximately 500 decks are available in circulations of 50M-1MM each. Most decks will accept pre-printed inserts at a higher cost per thousand. Many are also mailing in the larger 5-1/2 x 7-1/2 format that is more pre-print friendly.

Catalog Bind-Ins/Blow-Ins: This distribution has been used in big numbers for years by the horticultural set (i.e. a magazine subscription offer or a lead generator for a lawn tool product is bound into a catalog). Many gift and apparel catalogs are now beginning to offer blow-in space as well as bind-ins to further serve the direct response advertiser. Blow-ins can run as little as half the price of package inserts to the same customers. They generally represent larger volumes and more predictable mail dates.

Other Alternatives: Newspaper FSIs have become more direct mail/direct response friendly as they are challenged with selling more pages while coupon distribution decreases. A great testing vehicle, they represent at least 100MM circulation weekly and can frequently be bought as remnant for under $4/M for a half page. Solo and blow-in opportunities are also available here.

Shared Advertising such as Inserts have been included in supermarket take-one racks, have ridden along with Pennysavers, order acknowledgements, retail circulars and the list goes on. As direct marketers look for increasingly creative methods to better their bottom line and find less expensive ways to generate new leads, and qualified inquiries, more will be developed. As direct marketing companies continue to be challenged by the cost of finding new customers, the pool of mail order sources will continue to shrink. Options like riding along with newspapers and/or retailer circulars delivered in mail boxes and selectable by county size and type of households could spawn a brand new generation of customers.

Advertise For Less, Get More. For all the success stories, the package insert field is just like the other forms of direct marketing response. It is a numbers game. If you watch the cost of printing and the cost of distribution, your response should be sufficient to provide you with a satisfactory cost per inquiry or cost per order. But for steady production of orders at reasonable and competitive costs, shared direct mail is hard to beat. And for ease of entry, low visibility, low cost, what could be better? The cost of heavy postage and four-color envelopes arent here. Inserts are inexpensive and for most products, there is an extensive universe. Many magazines, catalogs and continuity clubs distribute millions of inserts annually. They are making the investment in inserts. Isnt it time to consider this medium.

You Can Target The Following Audiences

New Businesses
New Movers

Why Pay More When You Can Pay Less? Be Smart, Advertise For Less!

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