Offer and Merchandise Factors to consider when selecting merchandise and making direct
Download ReportTranscript Offer and Merchandise Factors to consider when selecting merchandise and making direct
Offer and Merchandise
Factors to consider when selecting merchandise and making direct & e-marketing offers
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
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)
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.
Checklist of Basic Offers
Free Info Discounts Time Limit Samples Till Forbid Get a Friend Free Trial Yes or No Contests
Checklist of Basic Offers
Lifetime or Charter Secret Gift Load-Ups Free Gift Add-Ons (call)
Good/Better/Best
Bounce Backs Upgrade Downloads Buy-Back
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
Merchandise Selection Criteria
Need/Practical Originality Profit Margin Market Size Exciting Copy Shipping Safe/Legal Traits Supplier Exclusivity Traits Repeat Orders Price/Value Visual Appeal Personalize Packaging Too Many SKU
Web Suited Products
• Information • Not available in stores/unique (long-tail) • Story rich (see information above) • Updates and add-ons • Overcomes geographic limitations
Expanding an Existing Business
• Broaden your market definition – Ex: “executive planners” to “executive business gifts” • Ensure new products are consistent with customer’s image of your firm • Ensure new products fit the characteristics of your customer list – Pricing, past offer styles, lifestyles, recent purchases