MAKING CUSTOM WORK HARDER
ROI keeps custom on track
When every dollar of a marketing plan is expected to work harder than ever before, every program is coming under scrutiny—including custom. But because custom publishing has ROI and accountability built in from the start, custom publishers have the best justification for capturing a good share of the marketing budget because of the recessionary environment. In fact, custom publishing experts say recession-proofing a program is very much about ROI.
What's most important in this environment is to have clear objectives and measurable results, says Valerie P. Valente, senior VP-publishing director, Rodale Custom Publishing. "If it works, it is recession-proof," she says.
The whole idea behind custom publishing is that marketers set out to strengthen relationships with their best customer segments, emphasizing metrics such as lifetime value, revenue per user, customer retention and customer satisfaction, says Chris W. Schraft, president of Time Inc. Content Solutions and sibling Liquid Dialog, a digital marketing services company.
Marketers recognize that the cost and complexity of attracting new customers, coupled with the fact that existing customers may be strong advocates, now makes retaining existing customers even more important, Mr. Schraft says. Those that "follow this strategy understand that their future growth depends on their loyal customer base."
If there is one piece of advice that all custom publishing experts give, it's that the biggest mistake any marketer can make even in today's environment of slashed marketing budgets is abandoning custom programs altogether. In the long run, they say, discontinuing an effective initiative will turn out to be more expensive.
By dropping such efforts, a company is acting counter to the whole reason for CRM programs and instead saying that the relationship with the customer is not important. "This is exactly the opposite of a good custom publishing plan," says Marcelo Bauer, founder and director, Cross Content Comunicação. Additionally, starting up again in the future is likely to be much more expensive, he says.
Ms. Valente, too, says she has no doubt that canceling programs altogether is the least desirable option. "If budgets are reduced and costs need to be trimmed, then look to ways to adjust a program in the short term while finding a way to maintain the momentum you have already invested in," she says.
Georgia Galanoudis, custom solutions group director, Meredith Parenthood Group, agrees. "Marketers that show strength in poor economic times will send a message of stability and quality," she says. "When times are tough, consumers get choosy. It becomes even more important for your messaging to reach the right audience. Custom programs are highly targeted and focus in on the customers that count."
It's all about targeting, measuring and identifying key segments that can work hard and avoiding the "whole ocean" approach, says Joseph Barbieri, VP-marketing and digital development, Redwood Custom Communications.
Mr. Schraft says that the only way for companies to thrive in a world of oversupply and overleveraged consumers is to hold on to their bases and sustain their best relationships. He believes recession-proof programs must include the following:
- Embedding programs with behavior triggers that drive profitable action.
- Setting up a measurement and analytics system to calculate profit and ROI.
- Recognizing that marketers can broaden the market for products or services by motivating customers who are unaware of latent needs.
- Refraining from limiting or restricting a custom program just to those thought to be in the market at the moment because only a small portion of the customer base is actively in the market at any given time.
Meanwhile, marketers are looking at everything from paper to postage, from frequency to reach, and how to deliver the same content in a less expensive way that still reflects a quality product. A close examination of other paper sizes or distributing as an insert with a partner may offer some options too, says Juan José Durán, interactive media director, Televisa Publishing + Digital.
While migration to the Internet as well as integration of new Internet and digital components began before the U.S. economy was officially declared in recession, the economic downturn has impelled marketers to jump on the bandwagon even faster.
However, the migration-integration trend is gaining ground for reasons other than simple cost-efficiencies as marketers examine their programs to find the right balance.
"Considerable resources and human capital are invested in these platforms," Mr. Schraft says. "Each will ultimately be measured on its ability to connect with and engage the target audience and drive some desired behavior. These programs are highly engineered—combining strategy, creative, content development, direct marketing influences and project management—and underdelivering in any of these areas reduces a program's probability of success."
Clearly, there is a lot of momentum toward digital applications, Mr. Barbieri says, but "nothing should live as an island unto itself. There should be a holistic, integrated approach." Clutter online, he says, is far worse than it ever was on the doorstep, so it requires driving awareness with traditional media. "For any initiative, big or small, holistic is the way to go. That can be a real distinguishing and competitive advantage."
Eric Schneider, CEO of Redwood, agrees: "Online is certainly a more cost-efficient way to manage your relationship with consumers. But there has to be a print component. You need to drive it to get people to go to a Web environment whether through a custom publication or supporting direct marketing or point-of-sale collateral."
There are other ways than going strictly digital to temporarily trim costs and produce better bottom-line results. Ms. Valente suggests looking at reducing frequency, narrowing distribution to a tighter audience and using creative editorial tricks to cut expenses yet retain messaging value. For example, she says, "if having a dialog frequently is important, then cut some content. If depth of information is critical, then reduce frequency for a short time. Maintaining consistency and momentum is critical."
Something as simple as just cleaning up a database can trim some costs. "People aren't just sending to anyone and everyone," says Kristen Bohn, group publisher, D Custom. "They are trying to be more targeted on the front end. When you target, which is what this medium is most suited for, you can eliminate waste. You need to be strategic about who you're going to send your publication to."
Testing and demonstrating success before heavily investing in a full-fledged program are also important. Marketers now are more conscious when they start a program to do all due diligence on the front end to make sure they can prove the program is going to be successful, Ms. Bohn says.
"We are definitely seeing a desire to ensure the content is delivered to the right customer through the right medium," Mr. Schneider says. "That ties into heightened sensitivity to the use of data to assess who you target in the first instance. If you are dealing with a custom magazine, there is an opportunity to create budget efficiencies by having a greater understanding of your value segments and perhaps using e-mail for less valuable customer segments."
In fact, some customers may say they prefer e-mail. This push for the greatest efficiency has led Redwood to place greater emphasis on strategy to help its clients' customers tighten up on both targeting and use of media as they relate to customer preference.
The custom publishers say there are also ways to use publications to draw customers closer to the purchase stage than they might otherwise be, such as including coupons for packaged goods. Ms. Galanoudis advises that programs that promote savings and offer discounts not only be retained, but actively tested and expanded.
In the automotive field, car companies are incorporating more content related to aftermarket sales and service reminders in their publications rather than focusing solely on maintaining relationships for the purchase or lease cycle of a vehicle.
Ms. Bohn says clients are also asking for less expensive paper alternatives, not only to reduce costs but also because they feel an expensive-looking paper is not the image they want to project in today's tough times.
The balancing act between cutting costs and maintaining quality can be a fine one, but one that experts say marketers must get right. Says Mr. Schraft, "Whether we're operating in a strong economy or one in decline, maintaining a quality orientation to custom publishing initiatives remains a priority."
SHRINKING ECONOMY: WHAT YOU CAN DO NOW
- Look for ways to adjust a program in the short term, such as cutting print content, reducing frequency and narrowing distribution.
- Go digital, but test, test, test to make integrated print and digital work harder together. Moving everything online to save money can be disastrous.
- Reduce frequency of updates in a digital product.
- Retain and expand programs that promote savings and offer discounts.
- Test all programs actively.
- Look at ways to cut production costs by considering other sizes and shipment methods.
- Ensure that quality is maintained.