Arandell Corporation

Gary Sierzchulski, VP, Arandell Data Services

In the past much “talk” was given to a direct marketing principle called contact strategy analysis.  What that means in layman’s terms is determining how often and when to reach your customers based on previous sales information.  In other words, using this approach you only contact your customers based upon their past purchase history, so a customer who only purchases during holidays would only be contacted during that season and so on.  The theory here was to maximize marketing dollars and tight budgets.

 Times Have Changed. 

 In the past two years many of you have reduced the frequency of your campaigns for all the reasons which we will not get into detail here.  If you go to your mailbox you will see this first-hand.  But funny things are happening, the consumer is coming back, albeit slowly, and buying!  Buying because they haven’t been for a while and it is our nature to do so.  With or without you they will be back.  So what are you doing about it?

 #1 – Reach out to your customers.  If you aren’t, your competitors are or will be shortly.  Consumers are hungry for deals to satisfy their buying urges, and again have saved up some money to meet those needs.  It’s funny, instead of you creating a sense of urgency with them; they are the ones who are creating it.  So meet their needs.  Even those who you consider your best customers (highest RFM) need to hear from you now.  In the past this segment would buy from you regardless.  Now they want to know that you’re still in business to start with and that you value them and can meet their needs, both emotionally and tangibly. 

 Your older buyers were once buyers from you.  So you need to find out if they are still buying products like yours but just not from you.  There are several ways to do this and if you contact me we can discuss the methods to identify them. 

 #2 – Service is a lost practice.  You need to make it easy for them to return to you and more importantly buy from you.  Shipping incentives, in store pick-up, loyalty rewards, anything and everything should be considered to make your customers feel special again.  You have four marketing channels to interact with your customers.  Use them all but pay attention to which channels they choose to interact with you.

 #3 – Build up your brand.  Many of you “went away” for a while.  Your customers need reassurance that you’re still there for them.  More frequent contact now as opposed to selective contact will get you there.  Most of you have noticed that your house file is stagnant at best or probably has decreased over the past two years.  For your survival, that trend needs to stop but will only do so through increased contact with your customers and reaching out to potential customers, something of a lost art called prospecting. 

 #4 – Thank them for their business.  How? – By telling them.  As I said many times before, the more quickly you reach your buyers after a purchase, the higher the future response rate is.  And if you personalize the piece in some fashion the responses are even higher.  Why wouldn’t you make this a standard part of your business practice?

 Again, the time is now.  Create the sense of urgency with your customers and they will respond.

Don Landis, VP, Postal Affairs

It’s hard to believe but we’ve been talking about revised deflection/droop standards for at least eight months now.

For those of you who are just tuning in now, the droop (deflection) test measures the flexibility of mailpieces (specifically commercial flats). If mail pieces are too flexible they will topple over as they travel through the USPS sorters and scanners. Implementing deflections standards, or droop standards, will greatly reduce the amount of direct mail pieces that fall off the machines. Recently, the USPS extended the deadline for the deflections standard implementation to June 7, 2010. And, price consequences will take effect October 3, 2010. With the change in implementation dates, also came some changes to the way the droop of your mailpiece will be measured.

Click here to see an instructional video. Otherwise, read on!

(With regards to the video we know that the square piece is very close to failing, but it did meet the USPS standards.)

Written instructions about how to measure the droop of your mailpiece can be found here. (To get to the instructions, skip to section 1.6 of the document.)

You failed the droop test, now what?

Contact us! We have lots of solutions for drooping catalogs. We can work with you to make sure you optimize postage savings and pass the deflection standards … all without changing the style and branding of your catalog! (We have already worked with the client (along with many others) whose catalog failed in the video to transform their piece into one that will pass the newly-revised droop test.

Here are some additional resources if you would like to learn more about the new deflection regulations:

Click here for some of the industry comments about the new standards.

Click here to contact me or Susan Pinter, Arandell’s postal experts.

Don Landis, VP, Postal Affairs

Since its inception three years ago, the ACMA (American Catalog Mailers Association) has focused primarily on the very issue for which it was founded: being catalog mailers’ watchdog group for keeping postal rates in check. To date, no organization had gone to bat solely for catalogers when it came to postal matters. ACMA’s mission is to advocate for catalogers where others cannot. They also partner with other organizations where catalog interests are squarely aligned.

ACMA’s such collaboration revolves around the new Colorado sales and use tax reporting requirements for out-of-state sellers who do not collect sales taxes from Colorado residents for their purchases. This law became effective on March 1, 2010.

And with that, the ACMA poses the following: What’s worse than having to pay sales taxes in every state? Having to report to every state every purchase your customers have made so the taxing authorities can start chasing your customers down and ordering them to pay back taxes.

Your Colorado customers now must get a statement recapping their purchases that you will also have to send to the Colorado tax collectors so they can hunt your customers down for the sales tax — and probably with a penalty on top of this. This experience is sure to make Colorado customers think twice about ordering from you, plus you now have an added cost of compliance without any offsetting revenue. It’s a triple whammy.

But wait, there’s more. Tennessee, California and other states are considering this same law or watching Colorado’s closely. Fact is, every state needs more revenue today. Out of state companies, who do not use any state services and who do not elect state politicians, are easy targets.

The Direct Marketing Association is coordinating a multi-industry legal challenge to the new Colorado tax law and will be using acknowledged state tax expert attorney George S. Isaacson to stop this from doing real damage to direct sellers of every type. We fully support DMA efforts.

Per a memo from DMA senior vice president, government affairs Jerry Cerasale, the new reporting law was passed by the legislature and signed by Colorado Governor Bill Ritter Jr., as part of a budget balancing package. DMA and others urged the Governor to veto the bill, but to no avail. It now must be challenged in the courts.

The reporting law requires non-sales-tax-collecting out-of-state marketers to notify Colorado purchasers with every purchase and includes the following stipulations:

• They are not required to collect sales tax;
• Sales or use taxes are owed by the purchaser unless the sale is exempt from sales tax even though purchased remotely, including over the Internet, telephone or catalog;
• The purchaser is required to annually file a sales/use tax return with the Colorado Department of Revenue and pay tax on those purchases on which the resident has not paid sales tax;
• The marketer is required to provide the purchaser with a year-end summary of the purchases the consumer made on which sales taxes were not collected; and,
• The marketer is required to provide the Colorado Department of Revenue an annual report on the total amount of all the purchaser’s purchases on which sales tax was not collected.

More information can be found at www.taxcolorado.com.

Taxing indeed!

The proposed year-end notice to the Colorado purchaser regulations require the following:

• Notice sent by Jan. 31 only via First-Class Mail with “Important tax document enclosed” appearing prominently on the envelope;
• A summary of dates of purchase, description of product purchased and dollar sale amount for each purchase;
• A statement that Colorado requires that the purchaser file a sales/use tax return at the end of the year and pay tax on all Colorado purchases on which no sales tax had been collected;
• Inform for the purchaser that the form and further information is available at www.taxcolorado.com;
• Notification that the marketer is required by Colorado law to provide the Colorado Department of Revenue with the total dollar amount of purchases the purchaser made; and,
• Though not required, it may inform the purchaser whether an item purchased is exempt from Colorado sales tax.

The notice to the Colorado Department of Revenue must include this information:

1. Name of the Colorado purchaser;
2. Billing address of the purchaser if provided to the marketer;
3. Shipping address of each purchaser if provided to the marketer;
4. If the marketer has multiple billing and/or shipping addresses of the Colorado purchaser (Colorado purchaser is a consumer who has product shipped to him/herself in Colorado), provide all such addresses; and,
5. Total amount of Colorado purchases made by the purchaser from the marketer.

For more information, please feel free to contact Don Landis, Arandell’s VP of Postal Affairs, HDLandis@arandell.com.  He can also be reached at 800.558.8724.

Susan Pinter, Director of Postal Systems

The USPS recently made the following announcements regarding the 2010 Summer Sale and a newly-launched website regarding 5-Day Delivery.

2010 USPS Summer Sale

The USPS has announced the 2010 Standard Mail Summer Sale Program. To be eligible to participate in the 2010 event, a company must have mailed 350,000 or more Standard Mail letters and flats between July 1 and September 30, 2009 through Permit Accounts owned by the customer or through ghost permits. The sale offers eligible companies a 30% postage rebate for a predetermined volume threshold mailed between July 1 and September 30, 2010.

Additional information about the Summer Sale Program is available at

www.usps.com/summersale.

5-Day Delivery Website Address

The USPS has launched a website on usps.com to provide information to all customers about its proposal to implement a five-day street delivery schedule. The Postal Service proposes to end regular Saturday mail delivery to street addresses as part of a comprehensive plan to ensure that it can continue to deliver affordable service to the American people. Post Offices will remain open on Saturdays.

The website has a planning guide for businesses and household customers, as well as answers to frequently asked questions.

The site is live and can be visited at http://www.usps.com/communications/five-daydelivery.

If you have questions about either of these updates, please feel free to contact Arandell’s postal experts:

Don Landis (HDLandis@arandell.com)

Susan Pinter (SGPinter@arandell.com)

They can also both be reached at 800.558.8724.