You can't afford NOT to test in tough times

Here’s an adage for today’s marketers, “When the going gets tough, the tough get creative!”  In good times, success is often an obstacle to creativity.  

Suggest a new idea when things are on the up and up, and what’s the response?  Often the answer is, “Everything’s working, why change it?”  That kind of complacency leads to less than optimal results in the long run.

Tough times breed the willingness to take risks and try new approaches.  That’s good, but be sure to use best practices to test new ideas against your control offer to be sure your new ideas really are better.

Let’s face it.  Testing takes time and money, but think of it as an investment in your future, and testing doesn’t have to be as expensive as you might think.

Testing lists and offers are the least expensive tests you can run, and they have the biggest potential pay-offs.  It’s testing fancy creative that usually runs up the big bucks, and gets the poorest results.

Here are some ideas for testing that will reap rewards and be well worth the time and investment.  Acxiom can help you implement any of these ideas in your marketing program:

Track your results – This is Testing 101.  You want to be sure you can measure your results in upfront and backend results.  Review your systems for coding the response to your campaigns and measuring your return-on-investment (ROI).  A good testing plan must have a way to track results so you can measure and compare your test results.  Tracking is usually easier for consumer marketers than business-to-business marketers, but there are a variety of tactics that work for both. 

Test against a control – Always test against a control offer.  This is your benchmark for evaluating your results to know if your test is projected to be better or worse that your control offer.  Your control is your mainstay—the combination of creative, list and offer than gives you your most reliable, profitable results to date.

Test one variable at a time – Marketing results are a complex mix of variables.  If you change more than one variable on a test, you can’t pinpoint what caused the change.  It will save you money in the long run if you test one variable at a time.  You can conduct multiple tests in one campaign, but just be sure each test panel changes one characteristic of your campaign.

Use reliable sampling techniques – The larger your test sample, the more reliable your results.  Statistical validity depends on a combination of sample size and response rate.  In some markets, it’s hard to get a statistically valid sample size, but just be aware that the smaller your sample size, the less reliable your results.  Your test samples should be a random sample of your control universe. 

Back-test for adding reassurance - If you’re concerned about the validity of your results, it’s a good idea to retest.  You can back-test your control when you roll out a new offer, just to be sure. 

Test formats that can save you money – The U.S. Postal Service is increasing rates again on May 11, 2009.  It’s more important than ever to use cost-efficient mailing formats.  Work with your printers to test formats that are economical to print and mail.  With changing postal regulations, you want to use formats that can save you money.  Adjusting the trim-size or weight of a catalog, or switching to a letter-sized self-mailer could save lots of money.  Do an ROI analysis to determine the overall profitability of different formats.

Lists have the most leverage – Of all the tools in our marketing bag of tricks, the lists we use are the power tools.  Review your list plan every season and always be on the look-out for new lists and ways to target the lists you are already using.  Developing a customer portrait can help you find matching characteristics in your prospecting pool. 

Test including a follow-up mailing - Consider adding a follow-up mailing, two-to-three weeks after your main mailing, to the top 10-20% of your customer and prospect mailing lists.  The additional cost to overprint for a follow-up mailing can be negligible, and the mailing results can give a big boost to your bottom line.

Experiment with personalization – Used appropriately, personalization is a great way to increase response.  Variable data printing is pushing the envelope on new ways to customize your mailings to address customers and prospects with highly personal messages and offers.  Personalization can address unique interests, demographic characteristics, and trigger events like new movers and homebuyers.

Test new offers – In recessionary times, consumers are combing promotions for special offers.  You need to balance a special offer against devaluing your product or service, but now is the time to make a special offer to keep or gain market share against your competitors.  Just be sure you track your results so you can evaluate the long-term ROI of special promotions.

Use a multi-channel approach – Use a combination of direct mail and email marketing to reduce costs and enhance your testing plan.  If you have email appended to your customer and prospect files, you can test many approaches via email—often a faster and cheaper approach—then roll them out to your direct marketing campaigns.  You can do this with offers, messaging, creative concepts, even lists and list segments.  With email, you get your results in days, not weeks, which can turbo charge the implementation of new campaigns and help you move forward faster with more profitable promotions.

Acxiom can help you implement an effective testing plan.  To talk with an Acxiom Specialist, call toll-free 866-977-6018 (8:00 – 6:00 ET Monday through Friday) or email us at IBLExpress@Acxiom.com.

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