Direct Marketing Insider’s Testing Secrets

THE SUCCESS MARGIN

Tuesday, January 4, 2005

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Me, a gambler?

Most people who see my huge marketing campaigns,massive mailings and full-page ads running worldwide assume I’m a born gambler.

But nothing could be further from the truth.

Fact is, I hate gambling. The odds in winning any game of chance are stacked against you. Clearly, I don’t like games where you have zero chance of winning in the long run.

Gambling is for suckers. When I observe so many poor souls who actually expect to make money gambling but lose big, I really feel sorry for them.

One of the biggest benefits and what makes direct marketing the most powerful and successful way to sell products is just the opposite of gambling.

You can always approach marketing in such a way as to always have the odds stacked 100% in your favor.

The key to direct marketing with almost no risk is testing.

Testing is the lifeblood of every successful direct marketing business, small or large.

You can run marketing campaigns as some do–without any testing whatsoever. However, instead of suffering ongoing losses or even being forced out of business, you can eat your competitor’s lunch if you closely follow the recommendations here today.

Tried and true tips:

  1. Test the big stuff first. Concentrate on elements that will make a big enough difference in response to justify doing it.

    Tip: Don’t be afraid to invest money. The additional cost could pay for itself many times over.

  2. The big stuff includes:

    — Your Unique Selling Proposition (USP). Test the USP around which you’ve built your ad,letter or e-mail.

    — How does your product compare and stack up against competition with regard to benefits? Pricing? Samples? What makes your product unique and different?

    Tip: Test different versions of copy, each one of which emphasizes a different USP. The test results can often reflect amazing response differences of as much as 5 or 10 times.

    Tip: Test long copy versus short copy. Always test one sales message against another and carefully measure the results.

  3. Headlines

    A good headline can increase your response enormously. Differences of 300% to 500% are not unusual.

    Tip: Never run an ad or mailing online or offline without at least one headline test. Creating good headlines are the fastest and least expensive, creative thing you can do to both look for breakthroughs and increase response.

  4. Test lists

    The most powerful mailing list you will ever use will always be your own database. Reason? People who know and trust you from past experience are always more responsive to new offers.

    However, a successful direct marketer is always looking to expand the in-house list with fresh new buyers.

    Tip: The best outside lists are proven mail order buyers, not inquirers. Look for people who have bought something at approximately the same price as your product. Recency is also important. Select names who have bought. And within the last 3 to 6 months.

  5. Test offers

    Test prices. Test different combinations. Test the copy describing the offer. For example, “Two for the price of one” usually outsells 50% off.

    Tip: Seek to constantly strengthen your offers.

    Include free bonuses and test them. The free bonuses you include can make a huge difference in response.

  6. Test order forms

    The purpose of a mailing or ad is to get an order. However, most order forms are ugly. Make yours beautiful, colorful and user friendly.

    Tip: Always use a headline. But never use the words “order” or “form.” Instead, use these magic words:

    Free Examination Certificate Free Trial Offer No Risk, Free Trial

    Use a stock certificate border. Use good paper. Include photographs of your product and/or people using and enjoying it.

    Tip: Test three offers as follows:

    (a) Good deal
    (b) Better deal
    (c) Best deal

    Each one should be more favorable and attractive to the buyer.

  7. Test the P.S.

    Always include a powerful P.S.. The P.S. is the second most read part of the letter or ad next to the headline.

    Tip: Restate your biggest benefit or a new benefit in the P.S. and repeat your guarantee and free bonus gifts.

    Tip: A handwritten P.S. can often increase response.

  8. Test graphics colors of ink and paper

    I recently recommended using brightly colored envelopes to a client instead of plain white. Everything else remained exactly the same. Sales increased by 17% immediately. Graphics, including typefaces and photographs, can improve response by 2 ½ times with the same copy.

    Tip: Make the headline words on the envelope and letter much larger and bolder for a usual response boost.

    Tip: Once you have an offer that is either profitable or covers costs (breakeven), this becomes your “control.” Or benchmark. Thereafter, until you beat the control with a
    better response, always run all new tests against the control.

ip: Be sure to code each offer online or offline to assure you are measuring the exact element (headline, P.S., offer, etc.) making the difference in response. Offline this code can be e.g. a department number; online a new link is best.

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With all major testing, it’s very important to test one major element at a time. In this way you can clearly read results as well as avoid confusion.

One good strategy that’s economical and I like is this:

  1. Test 3 different lists, each with 1,000 prospect names. You won’t get scientific results from a small test. You normally need at least 50 orders to make accurate projections. But you will get an indication.
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  3. If indication is encouraging, test 3,000-5,000 names from the same lists.
  4. If results continue to indicate an expanded mailing or “roll out”:

    (a) Test 15,000-20,000 names on each list
    (b) If testing again so indicates, “roll out” to 50,000-200,000 names.

    Tip: Of course, it’s much more economical to test online than offline. But normally response rates are considerably lower than offline. You can therefore conduct far larger tests (i.e. 5,000 to 50,000) without a large investment.

    Please note. The real money is always in repeat sales. The so-called “backend.”

    Therefore, what I’m looking always to do in all my tests is first to add new customers to my lists and break even or better. Happily, many of my
    offers, even on repeat products, are profitable right on the front end.

    But while desirable, front-end profits are not at all necessary in a healthy direct marketing company.

    Step two is a continuing contact at least once a month with a series of attractive offers to develop the enormously profitable backend.

Enjoy your new, greater level of prosperity as you test for success.

Your correspondent,

Ted Nicholas