Opinions expressed by Entrepreneur contributors are their own.
Direct marketing is the workhorse of small businesseseverywhere. So chances are, your own marketing plan will includesending some form of direct mail to prospects. But how much do youreally know about the technical side of buying direct-mail lists? Awell-qualified list is critical to the success of your campaign andcan contribute several percentage points toward a positiveresponse.
To make sure your next direct-marketing effort gets maximumresults, here are answers to four of the questions most frequentlyasked about lists.
1. What kinds of lists are available?
- Many publications rent out their lists. Publications with paidsubscriber lists generally offer only names and addresses, whilelists provided by controlled-circulation sources (typically nonpaidsubscriber bases) put their readers through an extensive qualifyingprocess and may give you more options to choose from.
- Compiled lists are constructed from directories, such astelephone books. These are the least preferred because they mayhave a large number of inaccuracies, resulting in undeliverablepieces.
- Associations and other membership groups often rent theirlists, which offers an easy way to reach people with commoninterests.
2. Where can I find the right lists?
The best place to start is in the reference department at a majorpublic library, with a Standard Rate and Data Service (SRDS)directory called The Direct Marketing List Source. Thishefty tool includes most lists in the United States by category,and is available by subscription ($499 per year) online at www.srds.com
You can also use www.mediafinder.com, a free online resource with amailing-list directory organized by subject.
If this sounds like a lot of legwork, you can hire a list brokerto do the research and negotiation for you. List brokers are paidcommissions by the list vendors, though they may also charge you aminimal fee. You can find the names of major list brokers in theSRDS directory.
3. How do I evaluate list costs?
There's a base cost for list rental, which is expressed in costper thousands (CPM). That's the cost to rent 1,000 names,though you'll generally have to purchase at least 5,000 namesor pay a minimum fee. To test a list, 5,000 names is considered theminimum. But if the list you want to rent totals only 1,500 names,you may be able to arrange to use it multiple times in order tosatisfy the minimum.
Above and beyond the base cost for list rental, add in chargesfor any special qualifying criteria you require, called"selections." Typical selections for business-to-businesslists include geography, industry and a company's size orsales. For consumer lists, additional selections like householdincome and the number of children in the household will addincrementally to the cost of using the list.
Your price will include a set of labels. If your plans includeusing more than one list to reach the same target audience, youshould request the lists in an electronic format. Then you can haveyour mailing vendor perform a merge/purge to eliminate duplicatemailings, which not only annoy recipients, but also wastemoney.
4. How are lists sold?
Any list you buy will be accompanied by an agreement that mayinclude the list owner's right to OK your creative material andsend the list directly to a bonded mailing house instead of to you.(This prevents unauthorized copying.) Sometimes you must agree touse the list within a particular time frame, so the list owner canmaintain control over how often people on the list aresolicited.
When making your purchase, find out how often the list iscleaned and updated. This will help ensure the highest number ofdeliverables and the least amount of waste.
Once you've made your purchase agreement, lists are normallydelivered within 10 business days. And here's a tip: If youplan to mail again to the same list within three months, buy aduplicate set of labels. It's less expensive than making twoindividual purchases.
For more information on direct marketing, visit the Direct MarketingAssociation.
