By Harvey Hirsch for “The Digital Nirvana” on January 18th, 2010

Last week, a client asked me to help them get a better grasp on their marketing spend and their internal clients lofty expectations regarding direct mail vs. email ROI.  With their input, I crafted the attached, simple, spreadsheet to help them understand, and hopefully explain the ROI on any given campaign they launch.

If you’d like to use it to plan your own campaigns – just click here to download it.

This is how the sheet works:

• Put in the size of your mailing list (number of contacts).
• Put in your budget (how much you want to spend).
• Put in the price of the product being sold, and the cost per unit.  This gives you the net revenue per order.
• (print) Put in your postage cost per mail piece
• (print) Put in your mail services fee (list prep etc)
• (print) Put in your printing cost per piece.
• (email) Put in any flat fees associated with each deployment.
• (email) Put in the cost per recipient.
• (email) Put in any additional programming or hosting fees
• Put in your list fee.
• Put in creative fees.  This is whatever cost you need to pay your agency or other professional to put the campaign together.

Questions? Drop me a note

(part 2 in a series)

As mentioned in my earlier post – historically, people who buy printing often look to obtain cost savings by focusing on three distinct areas: process, production and distribution.  We understand now that these three areas need to be looked at as a “whole” to achieve true, lasting cost savings.

In order to do that – we need to look at what the true costs are. In a study by industry analyst Cap Ventures, they found that for every $1.00 spent on “print”, only $.24 of that is attributable to the final product:

So, now that you have that knowledge, here are some questions to think about:

• Does your vendor have the ability to help you with design? Copy? Photography? Can they act as an adjunct to internal resources or external agencies?
• Does your vendor have any tested systems in place to help manage “rouge” or “maverick” buying?
• Would the introduction of a POD or Hy-POD model help with your obsolescence?
• Does your vendor offer any distribution solutions? If so, are those solutions local, regional, national or global? And, are their solutions capable of merging with your current distribution footprint? (In other words, if you ship 90% of your product to the west coast, you are on the east coast does it make sense for an east coast vendor to store and ship your products?)

I think that in this day and age, in order to achieve any sort of lasting cost savings, you have to be willing to step outside of your comfort level. ask you current vendors some challenging questions and be willing to partner with them if they are in fact a best-in-class provider.

Questions? Drop me a note.

UPDATE: Someone asked if they can get a copy of the pie-chart in an .xls format – yes, drop me an email and I will send it off to you!

(part one is a series)

I had the chance to meet with a client last week for an informal review of their 2010 goals as they relate to marketing communication (MarCom as they know it). A major point of conversation was cost reduction. What can they do to reduce costs, increase speed to market and not compromise their “brand Integrity” in doing so?

In the past, cost savings initiatives have focused on reducing the cost of materials, and the cost of manpower. But many companies have exhausted these methods, already having put as much pressure on vendors as possible and have reduced the cost of materials to the point of potentially affecting the final quality, and ultimately risking the image of the brands they are trying to promote. And, they have downsized already overtaxed procurement and art departments to the bare minimum.

Looking at this challenge in today’s marketplace, we are forced to look for initiatives that may not be as intuitive and obvious, or may seem complicated or difficult to implement quickly or economically. Cost savings opportunities can be found at every stage of the brand communication life-cycle, from the earliest marketing strategy to final printing, fulfillment and distribution. This is largely because upstream decisions affect execution downstream. When brand managers, procurement professionals, designers and printing solution providers have collaborated in planning – when they share technologies designed to streamline and strengthen the process – there is a cumulative lasting effect of cost savings. This integration is integral to brand communication management. Let’s consider the three key opportunities for cost reduction along that life-cycle:

Historically both the client and the vendor understood that these three areas were strongly interrelated, but looked at them as unique opportunities for cost savings. In today’s market, we need to look at them as a whole, and we need to understand that where the three intersect is where true cost savings can be found.

Questions? Drop me a note!

steve@puttingdotsonpaper.com

“…Pull marketing is growing because marketers have recognized that potential customers are determined to control when and how they will access marketing information.  Rather than fighting this mindset, savvy marketers are using pull marketing techniques to build credibility and trust and then to enable potential customers to obtain the information they want when they want it.  Pull marketing will never completely replace push marketing, but it has become an essential marketing tactic for many companies.  Today’s most effective marketing programs are often a combination of push and pull.  For example, I frequently receive e-mails (push) that invite me to attend a Webinar (pull) or download a white paper (pull)…”

read the rest of the article here:

Print CEO – Printing Industry News and Opinion – For Effective Marketing, Think “Pull” as Well as “Push”.

Solutions Case Study

From time to time, I will be posting case-studies made available to me as a solutions provider for CGX. I will be deleting the “client” name, in an effort to avoid trying to sound like I am name dropping. The “vendor” name will of course be left in.

The Challenge: The extensive product & service offering of “CLIENT” requires a significant sales force with over 200 sales and service offices in the U.S. alone. With such an immense sales force, “CLIENT” faced a situation in which important sales and marketing literature was not being fulfilled in a manner that was consistent, on time, and without defect. Haydee Manzanero, a six sigma black belt who spearheaded this project, identified 117 process steps and over 50 hand‐offs in the old purchasing program. There was up to a 2 month lead time through 8 authorization steps to get a new marketing piece into the literature database for the sales force to order.

Their findings showed the following as areas for process improvement:

• Streamline their speed to market
• Increase competitive pricing across all “CLIENT” divisions
• Build confidence in the efforts of marketing
• Keep branding & offers consistent
• And ultimately decrease literature expenses

The Solution: Consolidated Graphics (CGX) was chosen as this strategic supplier and was tasked with helping to streamline “CLIENT”’s marketing literature process. By incorporating CGXSolutions’ Storefront application, “CLIENT” was able to merge all activities into one system that previously required three systems. The real time inventory and tracking information feature increased speed to market, decreasing out of stock incidents and obsolescence. This also assists in developing future programs that complement the sales fields’ self generating efforts in both Residential and Commercial segments. Prior to the partnership with Consolidated Graphics, the inventory information was sent out once a month and tracking shipments was difficult if available at all, representing a dramatic improvement over the old program.

The Results: Utilizing CGX Solutions’ technology generated immediate results in speed to market and inventory management resulting in cost savings for “CLIENT”. At the 2007 Operational Excellence review Haydee’s Six Sigma team identified a 64% reduction in expenses and a 48% reduction in process steps. Total cost savings were measured to total $2.8 million for the first year alone.

The integration of the CGX & “CLIENT” teams throughout the implementation process was comprehensive. In fact, the project was in the top 3 finalists for the “Teamwork & Culture” category in “CLIENT”’s Operational Excellence yearly review. As CGX and “CLIENT” continue to grow the relationship increases in complexity and has translated into many collaborative projects outside of literature inventory. CGX has been able to showcase an increasing array of technology advances in regards to commercial print and utilization of the vast printing network. “CLIENT” has increased their speed and variety to market while decreasing costs of these same functions. The relationship has added tremendous value in the form of onsite assistance with process improvement, the convenience and efficiency of online print procurement, and much more.

Think that a solution like this might help your company, or have any specific questions about the solution? Feel free to contact me!

steve@puttingdotsonpaper.com