Offer and Merchandise

1
Offer and Merchandise

• Factors to consider when selecting merchandise
  and making direct e-marketing offers

2
Offer Considerations

• Price
• Reasonable markup, competitive, test several
• Shipping Handling
• General rule do not exceed 10 of product cost
• Free attracts attention, or even expected in some
  categories
• Unit of Sale
• Each Two for Set of X
• Optional Features
• Colors, odd sizes, personalization

3
Offer Considerations

• Future Obligation
• Auto renewal, Get 10 for 1 and buy 5 more at
  regular club prices over the next year, Volume 1
  free others will be shipped each month
• Credit Options
• Usually increase average order size by 15 or
  more (not really an OPTION anymore)
• Incentives
• Usually increases response, but may not get good
  repeat customers (unless you continue incentive)

4
Offer Considerations

• Toll-Free Ordering (800) or (888) Numbers
• Increases response by about 15, customers expect
  this
• easy to use shopping cart for website
• Time and Quantity Limits
• Adds urgency if logical, but be sure to stick
  with it.
• The auction approach for the web (ebay)
• Guarantee
• ALWAYS offer a satisfaction guarantee and DO IT!!
  But, make sure you can live with it.

5
Checklist of Basic Offers
6
Checklist of Basic Offers
7
Short Term vs Long Term (front-end vs
back-end)

• Emphasizing the free or incentive aspect of the
  offer will usually increase initial response rate
  (front-end)
• Emphasizing the actual merchandise and/or the
  total price to be paid will reduce initial
  response, but usually results in much better
  conversion or purchase rates (back-end)
• Test to see which is more profitable

8
Merchandise Selection Criteria
9
Web Suited Products

• Information
• Not available in stores/unique (long-tail)
• Story rich (see information above)
• Updates and add-ons
• Overcomes geographic limitations

10
Expanding an Existing Business

• Broaden your market definition
• Ex executive planners to executive business
  gifts
• Ensure new products are consistent with
  customers image of your firm
• Ensure new products fit the characteristics of
  your customer list
• Pricing, past offer styles, lifestyles, recent
  purchases