Things to Know Before You Purchase Mailing Lists
by Elizabeth Layne
Direct mail can help make or break a business. Using mail, businesses announce new products, services, sales and location changes. Businesses can also send product samples to homes through direct mail, enticing both new and old customers. And the return is good. For every dollar put into direct mail, there's a $12.57 return, according to the Direct Marketing Association, a definite boost to the bottom line. Start off by asking the right questions.
Find Your Target
Your first goal should be to reach people who would be the most interested in your products and services, and who have the ability to purchase them. This is your target group and your mailing list should be customized to reach them. If you don't know who your target group is, the United States Postal Service recommends looking at your current customers and using their characteristics as the model for a mailing list. If you don't already know who your customers are, provide them with a simple survey. Ask about ages and incomes (through ranges), their interests and purchasing activities, for example. Occupational fields are helpful, too. The Postal Service also recommends looking at your records, including sales slips, invoices and delivery information, to glean information such as what your customer's buy, how much they spend and where they live.
Broker Vs. Owner
Most likely, you'll be renting a mailing list, not purchasing it outright. Mailing lists are typically rented on contractually agreed-upon terms. You can choose between renting from a list owner or a list broker. List owners sell only their own lists. For example, if you're selling camping gear and contact an association for camping enthusiasts for their member mailing information, the association would be the list owner. A mailing list broker has access to thousands of lists, and can offer you lists that best match your specifications. Some will even customize a list with data drawn from multiple lists.
Estimates and Questions
Gather a few estimates from those selling lists, and ask the appropriate questions to ensure you're getting a great list. Does the list include both names and addresses? How old is the list and has it been "cleaned," that is, passed through the U.S. Postal Services National Change of Address file to ensure that outdated addresses have been removed? Don't pay for duplicate names. Also ask what sources the list has been compiled from. You don't want a list from someone who is simply compiling them from telephone books, or perhaps misses the trade associations of which your target customers might be members. Inquire about how often a list has been rented within the past six months. A frequently rented list may have already exhausted all the potential it had for delivering new customers, according to J2O Designs Inc., a small-business web design and marketing firm advises.
Also find out what the guaranteed deliverability of the list is based on the U.S. Postal Services' National Deliverability Index. Although no list will have 100 percent deliverability, 95 percent is a mediocre rate, according to J2O Designs Inc. Also, to claim commercial Standard Mail and First-Class Mail prices, the accuracy of ZIP Codes of a mailing list must be checked within 12 months of mailing, according to U. S. Postal Service rules.
To help you compare mailing-list information, list owners or brokers present information on data cards, an industry-wide way of providing standardized information on every list, including costs. James Stephenson, author of Entrepreneur magazine's "Ultimate Small Business Marketing Guide," points out that costs shown on data cards are always for 1,000 names, which can range in price from $10 to $250, depending on how specialized a list is. A list that targets a specific profession can cost upward to $250, for example. Stephenson warns against buying mailing lists on costs alone. Choosing a less-than-perfect list can cost a business thousands in profits.