Leverage Subscriber Lists for Revenue

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As businesses move away from mass marketing toward targeted direct marketing, publishers are in an enviable and potentially lucrative position.


Wise marketers are using in-depth knowledge of consumer demographic, psychographic, behavioral and buying-preference profiles to segment and target customers who are likely to respond to their message.


Also, given the growing use of measurement metrics, there is an increasing focus on the return on investment. Moreover, marketers are looking for loyal audiences, as they tend to be receptive to marketing messages. Finally, as postal rates rise, marketers seek to save on this cost.


Publishers can offer this and more, which presents an often-untapped opportunity to add a profitable revenue stream while increasing the service provided to subscribers, enhancing advertising sales and making their publications central to the marketing efforts of their business customers.


With subscribers providing contact, and in some cases, demographic and other personal information, publishers have an inherent base of information from which to develop a marketing database. Many publications have a bond with subscribers and are a trusted source of information. This credibility and goodwill let publishers survey subscribers and gain key marketing information. The collection and storage of this information in a database allow for segmentation based on characteristics that are relevant for marketing a product or service.


Given their relationship with subscribers, publishers' in-house lists should generate higher response rates than prospect lists and let marketers engage in the interactive communication that makes database marketing successful. Also, via editorial feedback, publishers have insight into how to communicate effectively with their audience. Given the importance of creative and copy in moving consumers to action, this insight can be used to great advantage in creating communication for database marketing campaigns.


Publishers can profit from lending their goodwill to business customers by forming marketing partnerships. They have the wherewithal to become valuable partners to business marketers by developing marketing databases and working with marketers to develop database marketing programs.


They also are valuable allies by allowing the use of their database to segment subscribers, track and analyze program results, use their knowledge of subscribers' editorial interests to aid in developing marketing messages and help marketers defray mailing costs by allowing "piggybacking."


The tangible, and intangible, benefits of forming database marketing partnerships with business customers can be substantial.


By forming partnerships that deliver messages that add value to consumers, publishers can enhance relationships with subscribers. Through tracking and analyzing results of database marketing programs, publishers not only aid their business customers in improving their marketing programs, they gain information and insight into the habits, motivations and interests of their subscribers.


According to the Direct Marketing Association's Economic Impact: U.S. Direct Marketing Today study, "overall media spending for direct marketing initiatives was $204.8 billion in 2003, up 6.1 percent over 2002 expenditures." DM ad expenditures at the end of 2002 represented 56 percent of total U.S. advertising expenditures. The overall response rate for direct response magazine ads is low (0.35 percent) compared with that of direct mail (2.55 percent), according to the DMA's 2003 Response Rate Study.


It is thought that the difference in response rate is attributable to direct mail lists being more narrowly targeted. Publishers have the ability to overcome this, and thereby the opportunity to increase their share of direct marketing dollars, by using database technology tools to segment their audience based on target customer profiles.


Perhaps Chuck Fruit, senior vice president of integrated marketing at The Coca-Cola Co., summarized it best in his presentation at the Audit Bureau of Circulations' 89th Annual Conference in November: "Ideas are what we need from you [publishers] ... ideas about how to capture reader attention, how to influence attitudes and behavior ... about content and storytelling and creating experiences ... our vision is to work with our media partners to build deep, enduring relationships with consumers."


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