A few weeks ago I posed a question about direct mail providers and Transpromo on LinkedIn and got a very spirited response. The question was:
“Is the art and science of using transaction documents as a customer retention vehicle a threat to direct mailers or an opportunity? “
People took various positions, some positing that direct mail service bureaus (DMers) don’t know enough about data to take on transaction documents, others suggesting that transaction printers (TPers) don’t know enough about serving the needs of marketing to take on Transpromo. There seemed to be several consistent themes:
- The business of marketing on transaction communications is growing.
- Service providers who can offer both direct mail and marketing on transaction print (essential mail) have a brighter future than those who can’t.
- Partnering, in the near term, may be the most effective and reliable solution for service providers and their customers.
I’ve included some quotes from the (much longer) LinkedIn thread below. Please join in and share your opinion.
“It should be an opportunity to DM service providers but their fear of effectively managing data makes it a threat for many. Some will steer their way through and then manage the relationships they have with DM customers from whom they can take advantage to deliver true TransPromo applications. Many will shy away from the opportunity and the challenge – for those I fear life will be short. “ James Shand, TriPartum Limited
“I’m not sure most DMers can make the leap to transactional, let alone TP, which is much more sophisticated. Some can and have, but these are mostly different skill sets. DM firms in general have neither the IT/data sophistication nor the access to the right c-level execs in their customer-companies to get the buy-in and traction required to get the TP ball rolling.
Or spun another way, it would be easier for a transactional firm that does some good TP to expand much more easily into doing DM for its customers. And in that sense TP could be a real threat to DM firms. Now imagine a partnership between a smart DM firm and a smart transactional shop. That’s not a threat. That’s opportunity. “ Noel Ward, Managing Director, Brimstone Hill Associates
“From a data standpoint, I respectfully disagree that direct mailers are somehow inferior in their data utilization. Show me a TransPromo client who is currently utilizing not only modeling techniques, but then further refining those prospective “buyers” into Deciles 1 – 10? Show me a TransPromo client who is effectively employing Lifetime Value scores for direct mailing and lead generation cross-selling? Show me a TransPromo client truly utilizing household-level data to understand both the attitudinal and the behavioral characteristics of the prospect, then – and then only – crafting the message to that household?
The key to success, from my perspective, is building relationships with partners who have the hands-on experience in developing, implementing, and then measuring every step of the way. “ Mark Weishaar, Direct Marketing Practice Leader at IBM/Ricoh InfoPrint Solutions
“The key is for those companies who take on the data to have the skill set to manage the data, keep care of the data, and help the clients do more with the data. We find much too often companies who take this role on do not have the required skill set, and while a DM shop may have great skill in doing more with the data, they may lack the skill to take care of the data.
A Transactional Shop and a DM Shop have very different cultures, and having experienced working in both cultures, and attempting to integrate the two, they are both very interesting. It may seem simple enough, but they are typically at opposite ends of the spectrum.
I do see DM shops working on building up to being able to handle Transaction type of work, but it is not just about having nice fancy full color devices, it is about being able to manage the process, and the data.
And we see Transaction shops working on adding DM capability to help fill in the valleys in production, but they to need to change how they manage the process of bringing work in house.
The change in business culture for DM to start work with TP type applications, even the standard transaction type applications will be too much for some, and it is the same on the other side of the fence, the change in business culture on the transaction side to work with DM type of applications, the cultures are very different, those that can make the transition can be successful, but it is not a simple transition for high percentage of the market.” Kevin Smith, Principal and Founder at Courier10
“TP can grow as a way to communicate with and market to *existing* customers, but it doesn’t work at all for customer acquisition. That requires other mechanisms, including (really good) DM.
This is why a company that can do both, either internally or with a partner will be in a better position moving forward. Service providers especially must stop thinking of themselves one-dimensionally–that they are a DM shop or a transactional printer. Or even as a TP printer. Yet I see bureaus do this all the time. Success will come to those that can do more for their customers. The ones that don’t are gonna’ go away. “ Noel Ward, Managing Director, Brimstone Hill Associates
I’ll look forward to hearing what The Digital Nirvana community thinks of this topic!