Times Direct Marketing, San Francisco, will manage a direct mail test campaign for software developer Intrepid Systems, Alameda, CA, using a concept it's calling digital direct mail.
Instead of receiving the standard direct mail package — normally consisting of printed information and a response card inside an envelope — 15,000 retail organizations across the country will get packages containing CD-ROMs during the first week of November. The CD-ROM will contain all the information regarding Intrepid's DecisionMaster software.
“Digital direct mail involves creating an offer and putting it on a CD and then mailing it,” said Chris Peterson, president of Times Direct Marketing. “The CD is encrypted and contains information and an evaluation of the software. In order for them to unlock that information, they either have to call a 1-800 number or log onto a Web site and provide us with some personal profile information.”
By making organizations contact it before providing information on the product, Times Direct Marketing is able to identify and track the responses of everyone who is interested in DecisionMaster.
“The other thing about running the campaign this way is that those responding conduct self fulfillment,” Peterson said. “There is nothing to send back to them later on. Everything they need is on the CD.”
“We chose to go with a campaign like this because we wanted a value ad approach to marketing our decision support software,” said Maureen Kelly, manager of marketing communications at Intrepid. “We are hoping it develops between 200 to 300 new leads for us. The piece also delivers immediate fulfillment — and with the CD in it, it is less likely to be thrown out. The CD will cause most people to hold onto it and call us to inquire about it.”
Peterson said digital direct mail is going to become more and more common.
“Based on the good responses we have seen from similar campaigns and the fact that they seem to be outperforming standard direct mail pieces, we are absolutely convinced that this method is going to be used more often in the future,” he said. “From now on we will be suggesting to a lot of our clients that they try this method of direct mail. There is an interesting application for everyone here. It doesn't matter if you have a software product or not, or if your product is expensive or inexpensive.”
He said there are a number of factors that make using digital direct mail “compelling.” First, the cost of duplicating CDs is low, he said. “People will pay more attention to a piece of mail with a CD in it,” he said. And a CD can store a great deal of information.
An additional 1 percent to 2 percent increase in response rates are necessary to justify the cost of mailing a piece containing a CD, Peterson said, but the company can save money because there is no fulfillment mailing to be sent.
“An average piece costs 35 cents to 40 cents to get printed and mailed,” he said. “If you use a CD, you will have to add about another 35 cents to that. But in most cases when a company has to mail out whatever the responder orders, that fulfillment package costs anywhere between $2 to $7. With the CD, there is no fulfillment package to be mailed.”
The 15,000 pieces will be dropped all at once. Peterson said response rates will be available four weeks after that. The software, which costs more than $100,000 to license, assists retail organizations by providing them with reports on which products are selling and which ones aren't.
“DecisionMaster tells companies what exactly is performing well,” Peterson said, “and that information helps them to stock their inventory in the appropriate manner.”
Intrepid was recently acquired by software developer PeopleSoft, Pleasonton, CA.