Direct Marketing Math & Finance Seminar

Understand Which Values Determine the Success or Failure of Database Marketing Businesses

• 3 key numbers that determine a program's success
• Key response and profit measures every direct marketer must understand

Learn to Use The Right Promotion Costs to Fairly Evaluate Program Success

• When, why and how to account for test costs and overhead
• How to fairly assign a cost to Internet promotions

Calculate Contribution to Promotion Cost and Profit

• What is contribution to promotion costs and profit? Why is it so important?
• How should you calculate and use contribution to determine profit or loss?
• Ways to put these numbers to work for you

Learn Different Approaches to Determine Breakeven, Profit, and Loss

• When to use variable costs only to calculate a profit or loss
• How to calculate the response rate you need to reach a profit or acquisition cost objective
• Math shortcuts to quickly and easily calculate the response rate needed to break even or to meet a profit or acquisition cost goal

Benchmark Common Cost and Response Measures

Determine What it Costs to Acquire a New Buyer and How to Compute this Amount

Examine and Compare One-Step vs. Two-or-more-step Inquiry Conversion Efforts

• When to test and how to calculate cost and profit
• Avoid common mistakes made in multistep and industrial inquiry follow-up

DAY 2
8:30 A.M. - 4:30 P.M.

Assess the Profitability of Multiple Contacts

• Re-mails: Are they worth it?
• Can you afford additional nonselling pre- and post-mailings or e-mail messages?
• Guidelines for evaluating the value of collection, inquiry conversion, and other serial promotions
• Discuss response curves that apply to most media

Analyze Catalog Item Sales

• How the catalog pros measure item performance and profitability
• Creative approaches to evaluating item sales patterns that can increase catalog profitability
• Factors to consider when deciding whether to expand, contract or spin off a catalog

Do the Math of Continuous Purchase Relationships

• Key program drivers of clubs, insurance, subscriptions, financial and telecom services, fundraising, and other continuous customer purchase relationships
• How to answer confusing questions that come up when determining allowable member/subscriber/donor acquisition cost
• Learn how to calculate the average number of payments, shipments or renewals needed to break even and to make a profit

Put Financial Modeling to Work

• How projecting your business over the long-term can really pay off
• What elements to include in good business models
• Why all Businesses Should Compute Customer Lifetime Value (LTV)
• What many direct marketers don’t understand about the term “lifetime value”
• Several approaches to accurately estimate customer LTV
• How understanding key assumptions, caveats, and pitfalls will help you make better projections
• Planning a CRM program? The important role LTV plays

Design Reports With the Information Essential to Good Decision-Making

• Elements of good report design
• Unknown source Internet and mail orders: How to better track the true sources of these orders
• Sample layouts for good reports
• How database audits can provide you the assurance you need to protect your most valuable asset

Interpret and Use Direct Marketing Statistics

• How to respond to the common question: “What will my rollout response rate be?”
• How to compare test results and apply what you learn
• Guidelines for determining how large a test sample should be: When and what to test and how to exploit what you learn
• Criteria for designing good tests

Outline is subject to change.