Planning the Offer

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Planning the Offer
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What is the Offer?

• The offer is the proposition to the customer
  regarding what you will give the customer in
  return for taking the action your marketing
  communication asks him/her to take.
• It includes
• The manner of presentation (media, creative,
  etc.)
• The request for a response

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When thinking about the Offer

• Always remember the 40/40/20 rule!

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The 40/40/20 Rule states

• The success of any DM effort is determined by
• The right lists (40)
• The right offer (40)
• The right creative (20)

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3 Characteristics of an Effective Offer (Lois
Geller)

• Believability
• It has to make sense to the consumer
• Involvement
• It must attempt to get the customer involved
• Creativity
• It sets you apart from all the others

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Planning the Offer 4 Steps

• 1 Establish Objectives of the Offer
• What is the offer designed to do?
• Continuity sell? Cross-sell? Up-sell?
• 2 Decide on Attractiveness of the Offer
• Make attractive as possible, as freebies
• 3 Reduce Risk of the Offer
• Offer free trial or examination period of offer a
  money back guarantee
• 4 Select a Creative Appeal
• Offer appeals can be either rational or emotional

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Continuity Selling

• Continuity refers to offers that are continued on
  a regular (weekly, monthly, quarterly, annually)
  basis.
• AKA- club offers
• Examples
• Book clubs, CD clubs, and magazine subscriptions

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Cross-Selling

• Cross selling is when new, related or even
  unrelated products are offered to the customer.
• Beneficial strategy of direct marketing for
  profit maximization from current customer base.

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Up-Selling

• Up-selling is the promotion of more expensive
  products or services over the product or service
  originally discussed or purchased.

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8 Components of the Offer

• 1. Product or Service
• It must satisfy the needs or wants of the target
  consumer to whom it will be presented
• Product or service features must be understood

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8 Components of the Offer

• 2. Pricing/Payment Terms
• Price skimming - begin price at highest level
• Penetration strategy-begin with low price
• Price elasticity measures the consumer's
  responsiveness or sensitivity to price changes
• COD, BML, Delayed payment, installments

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8 Components of the Offer

• 3. Trial or Examination Period
• Helps overcome the risk factor of DM
• Very effective

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8 Components of the Offer

• 4. Guarantees
• Instrumental in overcoming a potential buyers
  reluctance to purchase an unseen product from a
  remote location
• Example
• 30 day money back guarantee
• Double your money back

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8 Components of the Offer

• 5. Sweepstakes or Contests
• Often perforated tear-offs, die-cuts, tokens, and
  stamps, as well as answers to questions,
  problems, or puzzles, are used.
• Check state local regulations.

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8 Components of the Offer

• 6. Gifts and Premiums
• Effective device for stimulating or increasing
  response
• Can be offered for buying, trying, or inquiring
• 7. Time Limits
• a part of the offer often involves limited
  quantity as well as specified time period
• While supplies last

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8 Components of the Offer

• 8. Continuity
• Positive option-customer must specifically
  request shipment for each offer in a series
• Negative option- the shipment is sent
  automatically unless the customer specifically
  requests that it not be
• more controversial

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5 Steps to Creating an Offer

• Perform Market Research
• Determine the Terms of the Offer
• Target the Offer
• Test the Offer
• Execute the Offer

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Step 1 Perform Market Research

• Analyze Customer Needs Wants
• Determine Customer Motivations
• Develop Customer profile(s)

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Step 2 Determine the Terms of the Offer
(Product Details)

• A choice of sizes
• A choice of colors
• Personalization
• Product Specifications
• Product Accessories

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Step 3 Targeting An Offer

• What am I selling?
• Who am I selling to?
• Why am I selling this now?
• What do I want my Prospect to do?

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Step 4 Testing the Offer (A 4 Step Process)

• 1 Test only one feature at a time
• 2 Code your tests so you can
• measure results
• 3 Keep accurate records
• 4 Analyze test results and take
• action

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Step 5 Execute the Offer

• Get ready to implementmany details to address!
• Roll-out

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Some Popular Offers

• Free gift Offers
• Other free Offers
• Discount Offers
• Sale Offers
• Sample Offers
• Time Limit Offers
• Guarantee Offers
• Build-Up-The-Sale Offer
• Sweepstakes Offers