October 9th, 2007

"The Difference"

IN THIS ISSUE:

	A Letter from Monica C. Smith
	The Next Mile
	Replacing Broken China?
	Paid Search - Thinking out of the Box
	Avoiding Fool's Gold when Prospecting
	Going Social
	A Question for Brands

A LETTER FROM MONICA C. SMITH


Dear Colleagues,

As the end of this year quickly approaches we feel and see the pain of many Brands. My team and I expected the economy to be uncertain and troubled this year. And we know our community faces many hurdles (in addition to the horrific postal increases that had to be endured). In the face of the tighter economy and shrinking margins, we provide our clients with the grounding and support to take on the most challenging marketplace realities. We focus on identifying opportunities and generating growth and profit from their core markets. By identifying business concerns before they became realities we have been able to help our clients remain healthy in these uncertain times.

Unfortunately we foresee at least another two years of economic challenges in our marketplace. We are predicting a continuing faltering economy where numbers will trail off with a weakened housing market, an election year that will bring with it double digit inflation, and another postal increase.

In order to meet these challenges head on, brands need to get their marketing, financial and merchandise departments in line and in sync. Understanding what it takes to motivate the customer to buy AND how much your Brand can invest per order is not only essential but mandatory.

In this issue we discuss the mandate to get an ROI out of a marketing database in The Next Mile, the importance of understanding the potential impact of the Summer Olympics in China if you are dependent on that country for merchandise. We also talk about new ways to look at Paid Search, Prospecting, and Coupon Sites, all of which focus on assessing your spend. Finally we talk about a great experience my company had this summer with our Marketing Interns from my high school alma mater (it was fun).

This is the last newsletter for this year and I must end on a note that rings most important to me. I am a grateful entrepreneur, one who has had been fortunate enough to work with great Brands and a superior Team. For that gratitude, my company and I strive hard to give back.

On a personal note, I was privileged to be part of a fundraiser for a community group which provides outreach and support for local families in need, single mothers and their children, and the elderly. We reached out to our clients and friends and asked for their support and I was very touched by their generous responses. Their gifts made a tangible difference for the community and its constituents. My heartfelt thanks to AT Cross, Colonial Hardware, Tumi Inc, Eximious of London, Lillian Vernon, Smithsonian Magazine, Soundview Executive Book Summaries, Gary Bauman, Angela Render Web Development, and our great friends Andrea Sole and Traci Thrasher.

As we approach the season of giving and we look back on another great year of growth, we are grateful for all that we are and that we have been given, both in the generous hearts of our clients and the extraordinary outcomes of our work for our clients in a tough environment.

We love your comments and thoughts on our articles. We thank you for your continued commitment to cheering us on as we try to take the direct community to a new level of excellence. Response from our last newsletter doubled over the one prior.

My team and I wish you, your family and your organization the happiest and safest of holidays.

My Very Best Always,

M-

THE NEXT MILE


As a runner commits to a marathon for the long haul, so a marketer commits to a database. And as it takes time for the runner to hit her stride, it is also true for the marketer with a database.

The marketing database is still evolving. It has much distance to cover to reach its potential as a necessary and focal tool in today's direct to consumer world. We have seen many fail and even more be underutilized, oversold, or poorly configured, with inadequate training for those tasked with making the databases usable. The marketing database is like a person preparing for a marathon. If its data get a bill of health or close to healthy, it can slowly start to take up the training regime. You will not find overnight success. However, through the discovery process, you will uncover a history that may be painful but that can be repaired and strengthened. But with focused and committed action, you will reap the rewards over the course you take. A database should generate cost savings through efficiencies as well as allow for and support more effective marketing decisions and operations.

Our experience shows that a good benchmark for estimated savings in year one is a 15% reduction in duplicates, plus a 10%...Read more.

REPLACING BROKEN CHINA?


Imports from China have been increasing at double digit rates for the past ten years. In 2006, 40% of all consumer products imported into the United States came from China, with a value of nearly $250 billion. About 80% of all toys sold in the U.S. come from China. And, as of July, China is now the number one supplier of foreign goods to the U.S., edging out Canada in the latest reports from the Commerce Department.

Among the top 20 product categories imported are: Telecom and sound equipment, miscellaneous manufactured articles, apparel and accessories, furniture and bedding, footwear, travel goods and handbags, professional and scientific instruments, and photographic optical equipment, watches and clocks. Many of these product categories may be very familiar to you. And many of you may have a strong relationship with manufacturers and providers of these products.

There are three questions we raise for any distributor of goods produced in China to recognize and for which it may be important (no pun intended) to develop contingency plans. Read more.

PAID SEARCH - THINKING OUT OF THE BOX

In 2006, according to SEMPO, the search engine industry organization, marketers spend $8 billion in paid search, up about $3 billion from 2005. More and more marketers are looking to paid search as a source to generate incremental revenue. And every day another industry expert tells us how to use paid search to its best advantage; although these experts do not necessarily make the same recommendations. Additionally there are several industry standards for measuring the effectiveness of paid search.

However, none of these metrics give a picture of whether paid search actually improves profitability or not. First and foremost, Marketsmith recommends...Read more.

AVOIDING FOOL'S GOLD WHEN PROSPECTING

As we work with our clients to optimize their circulation strategies, we are keenly aware of the major hurdles they face in today's marketplace:

	The number of competitors is increasing, particularly due to online marketers, which can cause housefiles to shrink
	Costs of marketing are increasing - paper costs, postage costs, data management
	Reliable sources of new names/prospects are more difficult to identify
	Managing the increasing sophistication of technology can be unwieldy (see The Next Mile)