5Ws of Renting Postal Addresses to Increase Revenues

Digital marketers can take a page from traditional catalog merchandisers when it comes to increasing revenues. Forced to find news ways to build bottom-line results and profitability, catalogers have long rented out their customer and prospect address lists to non-competitive third parties in return for a fee or in exchange. The recipients’ see these lists for similar offers as providing a benefit and the customers and prospects see them as less intrusive than email.

  • Who:
    • List brokers are intermediaries between the two companies and take a percentage of the fees to facilitate these transactions. They help merchandise your list by finding interested prospective marketers.
    • Customers and prospects where you’ve acquired and validated their mailing information. Depending on your firm and its systems, you may have additional information about your customers such as age, income and purchase history, which can increase the value of your list.
    • Newest customers, known as “Hotline buyers,” have recently purchased from your firm and are excited about your offering. Despite having just purchased, direct marketers have found that they’ll buy more when they’re new and exploring what a firm has to offer.
  • What: Non-competitive offers since you generally don’t want your competitors to use your customers’ information. That said, there are instances where it may make sense to trade or exchange usage with direct competitors such as where there’s a small pool of customers.
  • Where: These engagements between your customers and the renter of your list happen offline in direct mail pieces and catalogs where consumers rarely track who’s using their times. For digital pure plays, this reduces issues around competitive factors.
  • When: Lists are rented for agreed upon terms. The list owner determines the frequency of the list’s use to prevent it from being overused. You want your list rented enough so that people on the list keep buying, but not so much that they get pissed off at annoyed with the amount of mail that they receive. Also, you want to ensure that a list hasn’t been used close to your planned mailing dates.
  • Why: Good reasons to rent your postal house file:
    • Provides an on-going source of income after the costs attributable to the database and list brokers.
    • Helps to keep your house file clean since each rental is an opportunity to get rid of non-working addresses.
    • Makes your customers more comfortable buying across channels and cross channel buyers tend to spend more.

If you’re an etailer with a strong database of your prospects and customer, consider renting the postal addresses to improve your bottom line.

Happy marketing,
Heidi Cohen

Photo credit: Heidi Cohen

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