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The Direct Mail Solution — Back-Matter: About the authors, index, and book excerpt
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219
About the Authors RAIG SIMPSON IS THE OWNER OF SIMPSON DIRECT INC., A direct-marketing firm based in Grants Pass, Oregon. Since beginning his career in direct mail nearly 20 years ago, he has managed thousands of direct-mail campaigns, helping to gross hundreds of millions in revenue for his clients. His direct-marketing company sends out nearly 300 mailings per year for his private clients. He works in practically every industry, marketing everything from courses on the benefits of drinking water to technical software, retail stores, real estate investment, financial services, health products, diet programs, insurance, and even wholesale clothing. Craig’s knowledge of list management and direct-marketing techniques has earned him the title of the nation’s leading expert C
220
THE DIRECT-MAIL SOLUTION
ABOUT THE AUTHORS
in direct-mail marketing. He is regularly asked to speak at national
events on his experience with direct mail. He is the author of The
Direct-Mail Solution, co-written with Dan Kennedy, available from
EntrepreneurBookstore.com.
DAN S. KENNEDY is a multimillionaire serial entrepreneur, strategic
advisor, and consultant, and one of the highest paid direct-response
copywriters in the world. As an author, speaker, and coach, he directly
influences over one million business owners annually. Information
about his books can be found at www.NoBSBooks.com. Direct contact
with Dan’s office: fax 602-269-3113.
Other Books by Dan S. Kennedy
In the No B.S. series, published by Entrepreneur Press
No B.S. Guide to DIRECT Marketing for NON-Direct Marketing Businesses
(2nd Ed.)
No B.S. Guide to Marketing to Leading-Edge Boomers and Seniors (with
Chip Kessler)
No B.S. Guide to Trust-Based Marketing (with Matt Zagula)
No B.S. Price Strategy (with Jason Marrs)
No B.S. Guide to Marketing to the Affluent
No B.S. BUSINESS Success in the New Economy
No B.S. SALES Success in the New Economy
No B.S. Wealth Attraction in the New Economy
No B.S. Guide to Ruthless Management of People and Profits
No B.S. Time Management for Entrepreneurs
With other publishers:
Ultimate Sales Letter (4th Edition—20th Anniversary Edition)
Ultimate Marketing Plan (4th Edition—20th Anniversary Edition)
Making Them Believe: The 21 Lost Secrets of Dr. Brinkley-Style Marketing
(with Chip Kessler)
THE DIRECT-MAIL SOLUTION
221
ABOUT THE AUTHORS
The New Psycho-Cybernetics (with Dr. Maxwell Maltz)
Unfinished Business/Autobiographical Essays
Make ’Em Laugh & Take Their Money
BOOKS CONTRIBUTED TO
Uncensored Sales Strategies by Sydney Barrow with Dan Kennedy
Marketing Miracles
Win, Place or Die: A Mystery Novel by Les Roberts with Dan Kennedy
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223 Index A acquiring new customers, 7, 112. See also customers action, requesting, 15, 20, 22, 28–30, 62, 63 address correction tools, 168, 178–179. See also cleaning mailing lists address panels, 215 AIDA formula, 15–16 attendee lists, 86 audience, 20, 30–31. See also targeting specific markets auto-bill renewal services, 133 AWAIonline.com, 68 B best-told story advertising, 9–10 bluelines, 211 booklets, sales, 66–67, 72–75 brick-and-mortar retailers, 59–60 broker reports, 176–178, 215–216. See also cleaning mailing lists; list brokers bulk vs. first class mail, 183–184, 189–191. See also postage business reply envelopes (BREs), 23 buyers lists, 86 buying behavior, 104–105 C calls to action, 15, 20, 22, 28–30, 62, 63 campaigns. See direct-mail campaigns catalog marketing, 52–54, 187 CD mailers, 37–38 cleaning mailing lists address correction tools for, 168, 178–179 benefits of, 167–172 broker reports and, 176–178, 215–216 data-processing services for, 170–171, 173–178, 210–211, 213, 215–216 duplicate record handling, 168–176, 213 interaction reports and, 215–216 multibuyers and, 172–173 suppression files and, 173–174, 177, 179–181, 212, 215–216 undeliverable address handling, 167– 168, 173–179, 215–216 Coding Accuracy Support System (CASS), 178 color proofs, 211 competition, 8–9 competitive offers, 92–93 compiled lists, 83, 88–89
224
THE DIRECT-MAIL SOLUTION
INDEX
complementary products and services, 134
continuation/usage lists, 97
continuity services, 133
controlled circulation lists, 84
copywriting. See also sales pieces
accuracy in, 206
AIDA formula for, 15–16
calls to action, 15, 20, 22, 28–30, 62, 63
hiring copywriters, 31, 68–69
length of copy, 16–18
resources about, 68–69
sales piece elements, 18–24
scheduling, 208
timing for, 206
tips for effective, 24–28
web pages, 61, 63
writing to audience of one, 30–31
your input in, 18–20
cost per acquisition (CPA), 135–136
cost per order (CPO), 135–136
cost tracking, 149
coupons, 59–60
customer files, 79–83. See also targeting
specific markets
customer lifetime value (CLV). See lifetime
value (LTV)
customer retention paths, 134–135
customers
acquiring new, 7, 112
ideal, 79–83, 104–105. See also targeting
specific markets
lifetime value of. See lifetime value (LTV)
maintaining files on, 79–83
modeling, 136–138
retaining, 134–135
D
data cards, 89–97
data hygiene. See cleaning mailing lists
data-processing services, 170–171, 173–178,
210–211, 213, 215–216. See also cleaning
mailing lists
databases for tracking, 154–157, 159–161.
See also tracking campaign effectiveness
DDNC (deceased do not contact) list, 180
deceased suppression files, 174, 179–180
decoy lists, 181–182
deductions for bad addresses, 168, 173–178,
215–216
delivery tracking services, 182, 191–192. See
also tracking campaign effectiveness
designing sales pieces, 31–32, 41–44, 69–71
desire, building, 15
digests, 36
dimensional mail, 38–39
direct mail. See also direct-mail campaigns
advantages of, 2–5, 8–9, 11–13, 111–112,
210
basic elements of, 13
criticisms of, 2
for driving traffic to websites, 55–64
lingo in, 21
media inflexibility and, 9–10
online buying and, 51–54
search vs., 108–111
statistics about, 187
time commitment and, 10
trust and, 21, 52, 64
Direct Marketing Association (DMA)
mailing facility information, 186
preference/pander file, 177, 181, 216
suppression files, 179–180
vendor lists, 31
Direct to Consumer Publishing, 196–197
direct-mail campaigns. See also direct mail;
expanding your reach
buying behavior and, 104–105
checklist for, 209
improving, 161–166
mailing lists for. See mailing lists
mailing options for, 184–193
online buying and, 51–54
Postal Service confirmation receipts,
188, 216–217
pre-mailing steps, 205–207
sales pieces in. See sales pieces
scheduling, 208–217
steps in, 205–207
SWOT analysis in planning, 204–205
targeting markets for, 11–12, 72–75,
79–83, 98–99, 104–107
testing, 41–42, 85, 155–159, 166,
182–184
tracking. See tracking campaign effec-
tiveness
direct-response messages, 66
discounts, postage, 168, 178, 188–189,
213–214
THE DIRECT-MAIL SOLUTION
225
INDEX
Do Not Mail lists, 177, 181, 216
duplicate names, 168–176, 213. See also
cleaning mailing lists
E
envelopes, 41–42
Epsilon Total Source file, 137
evergreen asset, 7
Every Door Direct Mail program, 192–193
expanding your reach. See also direct-mail
campaigns
benefits of, 119–120
customer modeling for, 136–138
increasing lifetime value for, 121–124,
132–135. See also lifetime value
(LTV)
price point modification for, 120–121
researching lists for, 120–123
sales piece modification for, 121
F
first class vs. bulk mail, 183–184, 189–191.
See also postage
follow-up, 160–161
fonts, 43, 44
formats for sales pieces, 38–40, 52–54,
69–71, 187
G
Google, 52
graphic designers, hiring, 31–32
graphics, 43
guarantees, 23
H
habit-force, 197–199
headlines, 15, 21–22
house files, 79–83. See also targeting specific
markets
hygiene, data. See cleaning mailing lists
I
ideal customers, 79–83, 104–105. See also
targeting specific markets
income predictability, 7
incomplete or bad addresses, 167–168, 178–
179. See also cleaning mailing lists
information marketing, 195–200
inquiry lists, 84
interaction reports, 173–176, 215–216. See
also cleaning mailing lists
interest, creating, 15
internet sales, 51–54
internet/direct-mail program tips, 61–64
K
key codes, 96–97, 182, 213, 214
L
landing pages, 59
lead generation, 55, 59, 63, 92
letter packages, 35–36, 61
lettershops, 213–214
lifetime customer value (LCV). See lifetime
value (LTV)
lifetime value (LTV). See also customers
calculating, 123–124, 127–131
of direct mail buyers, 55
impact on mailing campaigns, 124–127,
131–132
increasing, 132–135
out-of-pocket investments and, 112
tracking, 130–131, 139–141, 152–153
lingo, 21
list brokers, 86–89, 208–210. See also broker
reports
list compilers, 88–89
list hygiene. See cleaning mailing lists
list manager/broker, 89
list managers, 88
list orders, 210
list rental agreements (LRAs), 97
Locatable Address Conversion System
(LACS), 178
M
magalogs, 36
mail delivery tracking services, 182, 191–192.
See also tracking campaign effectiveness
mail processing facilities, 186–188
mailing codes, 182
mailing lists. See also direct-mail campaigns
cleaning up. See cleaning mailing lists
continuation/usage information about,
97
creating profitable lists, 97–99
data cards for, 89–97
delivery options, 96
due dates, 212
list costs, 92–93
list descriptions, 94–95
list sources, 93–94
minimum orders of names, 96
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THE DIRECT-MAIL SOLUTION
INDEX
orders for, 210
predictive factors and, 102–108
preparing, 207
renting, 78, 83–86
researching, 120
rollout potential, 91–92
segmenting, 79–82, 95–96, 147–148
sources for, 86–87, 89–97
targeted list testing, 85
targeting best prospects for, 98–99
timing for ordering, 206
types of, 78–86
updated, 90–91
verified, 91
mailing schedule and checklist, 209
marketing messages, 20, 62, 63, 66–75
match analysis reports, 173–176, 215–216.
See also cleaning mailing lists
merge purge, 168–176, 213. See also cleaning
mailing lists
messaging, 20, 62, 63, 66–75
modeling customers, 136–138. See also
customers
multibuyers, 172–173. See also merge purge
multis. See multibuyers
N
National Change of Address (NCOA) File,
178
O
offers, 20, 22, 92–93, 195–200
online buying, 51–54
opposite-direction success stories, 5–7
opting in, 55, 59, 63
order forms, 23
P
paid circulation lists, 84–85
pander files, 177, 181, 216
personal URL (PURL), 17, 60–61
photographs, 43
plain envelopes, 41–42
postage, 171–172, 183–184, 188–191,
214–215, 216
postage-paid reply envelopes, 23
Postal Service. See United States Postal
Service (USPS)
postcards, 17–18, 34, 37, 57, 60–61, 113–117
predictability, 7
premium services, 133
price points, 120–121
print catalog marketing, 52–54, 187
printing, 34, 44–49, 171–172, 208, 210, 211
prison suppression files, 174, 180
prospect capturing, 57–58
PS (postscript) in sales letters, 23
PURL (personal URL) postcards, 17, 60–61
R
receipts, postal, 188, 216–217
recently recorded deceased file (RRDF), 180
reciprocal rentals, 93
reliability, 7
removing names, 181
rented lists, 78, 83–86, 93, 97
response lists, 84–86
retaining customers, 134–135. See also
customers
rollout potential, 91–92
S
sales booklets, 66–67, 72–75
sales letters, 8–10, 18, 23, 38, 43, 68. See also
copywriting
sales pages on websites, 57–58, 63
sales pieces. See also direct-mail campaigns
attention-grabbing with, 15, 33–34
audience and, 20, 30–31
calls to action in, 15, 20, 22, 28–30, 62,
63
describing benefits in, 22
designing, 31–32, 41–44, 69–71
for driving traffic to websites, 57, 60–64
for driving website traffic to stores,
59–60
effectiveness of, 13–14
elements of, 18–24
graphics in, 43
lingo in, 21
message in, 20, 62, 63, 66–75
modifying for expanding reach, 121
offers in, 20, 22, 195–200
optimal length of, 16–18
photographs in, 43
postcards, 17–18, 34, 37, 57, 60–61,
113–117
preparing, 207–208
print catalogs, 52–54, 187
printing, 34, 44–49, 171–172, 208, 210,
211
THE DIRECT-MAIL SOLUTION
227
INDEX
sales letters, 8–10, 18, 23, 38, 43, 68
targeted, 11–12
testing, 41–42, 182–184
types of, 8–10, 34–42, 57–58, 60–61,
66–67, 69–71
URLs in, 17, 60–61, 62
voice in, 20–21
writing. See copywriting
sales stories, 9–10
search vs. direct mail, 108–111
seed lists, 181–182, 212
segmenting mailing lists, 79–82, 95–96,
147–148
self-mailers, 36, 57, 61
Serena & Lily, 52
shock-and-awe packages, 39–42
showing up alone advantage, 8
slim jims, 36
split tests, 156. See also testing
Standard Rate and Data Service (SRDS), 86
suppression files, 173–174, 177, 179–181,
212, 215–216. See also cleaning mailing
lists
SWOT analysis, 204–205
T
targeted list testing, 85
targeting specific markets, 11–12, 72–75,
79–83, 98–99, 104–107
terminology, 21
testing, 41–42, 85, 155–159, 166, 182–184
threshold resistance, 200–202
tracking campaign effectiveness. See also
direct-mail campaigns
accuracy in, 145
cost tracking, 149
databases for, 154–157, 159–161
individual mailing totals in, 153–154
key codes for, 96–97, 182, 213, 214
lifetime value tracking, 130–131, 139–
141, 152–153
list history tracking, 149–152
list segmentation and, 147–148
mail delivery tracking, 182, 191–192
mailing codes for, 182
purpose of, 143–144, 157–158
seed lists for, 181–182, 212
systems for, 145–147
tracking services, 182, 191–192
TrackMyMail.com, 182, 192
trust, 21, 52, 64
U
undeliverable addresses, 167–168, 173–179,
215–216. See also cleaning mailing lists
unit of sale, 93
United States Postal Service (USPS)
confirmation receipts from, 188,
216–217
data hygiene tools from, 168, 178
direct-mail program, 192–193
discounts through, 168, 178, 188–189,
213–214
study on effectiveness of direct mail,
52–54
working with, 184–186
US Monitor, 182, 191
V
vendors, 207
video sales letters, 57–58
voice in sales pieces, 20–21
W
websites, driving traffic to, 55–64
writing direct-mail copy. See copywriting
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B.S MARKETING TO THE AFFLUENT NO HOLDS BARRED BUTK TAKE NO PRISONERS GUIDETO GEG REAV RCH Dan Kennedy Foreword by Joe Vitale bestselling author of The AttractorFactor
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B.S. MARKETING TO THE AFFLUENT NO HOLDS BARRED KICK BUTT TAKE NO PRISONERS GUIDE TO GETTING REALLY RICH Dan Kennedy Ep Entrepreneur Press
Jere L. Calmes, Publisher Cover Design: David Shaw Production and Composition: Eliot House Productions © 2008 by Entrepreneur Media Inc. All rights reserved. Reproduction or translation of any part of this work beyond that permit- ted by Section 107 or 108 of the 1976 United States Copyright Act without permission of the copyright owner is unlawful. Requests for permission or further information should be addressed to the Business Products Division, Entrepreneur Media Inc. This publication is designed to provide accurate and authoritative informa- tion in regard to the subject matter covered. It is sold with the understand- ing that the publisher is not engaged in rendering legal, accounting or other professional services. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. Library of Congress Cataloging-in-Publication Data Kennedy, Dan S., 1954- No B.S. marketing to the affluent/by Dan S. Kennedy. p. cm.—(No B.S. series) ISBN-13: 978-1-59918-181-3 (alk. paper) ISBN-10: 1-59918-181-9 (alk. paper)
- Affluent consumers—United States. 2. Marketing—United States. I. Title. II. Title: No BS marketing to the affluent. HF5415.332.A34K46 2008 658.8—dc22 2008015785 Printed in Canada 13 12 11 10 09 08 10 9 8 7 6 5 4 3 2 1
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was homeless 30 years ago. No job, no home, no car, no nothing. I struggled in virtual poverty for a decade after that. As I worked on my business and my self, I became an inter- net celebrity, a movie star, and the author of numerous best- selling books. All of this brought me increased wealth. I’m in the kindergarten category of knowing true affluence, but after pay- ing off my debt, here’s some of what I’ve done with my money: • bought two exotic hand-made limited edition luxury sports cars, including one previously owned by a rock star (Steven Tyler of Aerosmith) who autographed the engine. • bought two of the rarest guitars ever known, including one hand carved out of Hawaiian koa wood by one of the greatest luthiers on the planet (Robert Taylor). • paid for professional auto racing instruction, which allowed me to roar around the Atlanta-Sebring racetrack in a fire suit and a helmet (and paid for a friend to attend with me). xi F O R E W O R D I How to Easily Attract the Affluent BY JOE VITALE
• given a staggering amount of money to the mother of a lit- tle boy who needed a special machine to help him recover from a pediatric stroke (a boy and a mother I’ve yet to meet in person). I’m not bragging or showing how frivolous I am. I can easily justify my expenses and even deduct them from my taxes. The truly affluent do far more than this, of course. They have private jets, more than one mansion, and servants to cook for them and their pets, and they spend money on diamond-enhanced cell phones. But I’m making a point here. I’m declaring that the affluent spend money on two things. Two things that you can provide. What are they? Experience and Exclusivity. As I wrote in my book on circus promoter P.T. Barnum, There’s A Customer Born Every Minute, people will spend almost any amount of money on something, anything, that will change their internal state. They want to feel something. Provide it and get rich. People also want to feel they are unique. If they can buy that uniqueness, they will. Owning something you’ve made—say, a collectible version of whatever you sell that few others have—is one way to accomplish this sense of individuality. There’s more, of course. That’s where Dan Kennedy comes in. Dan’s book is the first one to reveal the direct route to the affluent’s bank vault. He shows you how to open it and with- draw bags of loot, legally and joyfully. He talks about Experience and Exclusivity and a whole lot more. His branded No B.S. approach is a simple paint-by-the-numbers system for getting more than your fair share of the wealth the affluent are willing and even eager to spend. xii NO B.S. Marketing to the Affluent FOREWORD / HOW TO EASILY ATTRACT THE AFFLUENT
Dan is a living genius at marketing, a copywriting legend,
my all-time favorite marketing author, and glaringly brilliant at
teaching you to think differently about your marketing efforts.
He shows you how to get one thing: results.
To begin, stop thinking there are any limitations to becoming
affluent yourself, and start reading this book. You’ll then start to
attract the affluent—and their money.
Go for it!
JOE VITALE, star of the movie The Secret and outrageous internet marketing celebrity, is
the author of way too many books to list here, including Buying Trances, Hypnotic Writing,
The Attractor Factor, and The Key. His main website is www.JoeVitale.com.
NO B.S. Marketing to the Affluent
xiii
FOREWORD / HOW TO EASILY ATTRACT THE AFFLUENT
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or many years now, I’ve been all about helping small- business owners transition to entrepreneurs, turn ordinary businesses into extraordinary ones, break free of boundaries and limits, and make many more millions of dollars faster than they ever thought possible. I’ve chronicled the strategies used and their “case histories” in 11 books, beginning with How to Make Millions with Your Ideas, first published in 1996, through to No B.S. DIRECT Marketing for NON-Direct Marketing Businesses, first published in 2006, to this book, as well as in my monthly newsletters and the PHENOMENON™DVD, which can be found at www.InNext12Months.com. Nothing I’ve ever done has matched the impact of my most recent guiding, pushing, prod- ding, and nagging of entrepreneurs and marketers to reinvent themselves as needed in order to focus on marketing to the afflu- ent. THIS book summarizes those five years of guiding, pushing, prodding, and nagging. This book has three purposes. xv P R E F A C E F How to Use This Book to Get Very Rich
First, to sell you on transforming your business to market to, appeal to, and attract the affluent, thereby transforming your income, security, and business life. I use the word transform deliberately. I try not to fool around with things of minor signifi- cance. What you can do for yourself by combining price elasticity with marketing to the affluent is, in fact, life altering. You will have to buy this premise before anything else here has value to you. You will have to take ownership of this idea and be willing— no, eager—to work on it every day. There’s a canyon-sized gap between whatever curiosity brought you to this book and the commitment required to fully move to being a marketer to the affluent as your chief role in your business, as your personal pro- fession, as your greatest area of study, knowledge, and expertise. Getting that commitment in just 430 pages is a tall order. But that’s what I have set out to do, and I want to be completely trans- parent about that objective. I am here to sell you something. To sell you on making a major shift in every aspect of your business. Imagine that you own a shop on a main street in a part of town that is losing its well-to-do residents, its closest major employers closing their doors. Poverty is setting in. Sunny days stop; gloom and doom descend. People walk stoop shouldered rather than upright, shuffle rather than stride. Studiously avoid the displays in store windows like yours. From your shop doorway, you see your entire world, and it is in decay. Only three streets away from the rear of your store, out of your sight, is a community booming with new office buildings and lots of jobs, its street’s shops and restaurants busy all day with the area’s workers, equally busy in evening with the residents of the shiny, new high-rise condominium complexes at the street’s end. Golden sunlight makes the diamonds and gold bricks in the street sparkle. This is exactly the position so many business owners, profes- sionals in practice, sales professionals, and marketers are in. xvi NO B.S. Marketing to the Affluent PREFACE / HOW TO USE THIS BOOK TO GET VERY RICH
What they can’t see and are unaware of is not literally a place a
few streets away; instead it is a segment of the market immediately
before them and all around them. A unique myopia blinds so
many from seeing these people so eager to spend so much on so
many goods and services, with little concern over price.
If you would like to get very, very rich, you need to see where
the most money is and then go there to get it. Sounds foolishly
simple, I suppose, yet I daily see the vast majority of marketers
wasting valuable resources struggling mightily to get money
from people who have little of it to part with.
The second purpose, to give you new understanding of
who the affluent customers and clients are, where they are,
what they buy, why they buy, and how to get out of your own
way and get in sync with them.
There is this old story of some avid hunters who seek out and hire a highly recommended
guide to lead them to hidden herds of giant elk. Guns over shoulders, they hike, following
this guide through woods, up mountains, through rivers, into snow, for hours and hours,
until they gradually realize they’ve been hiking in circles. “Hey,” one hunter says, “you’ve
got us lost. I thought you said you were the best hunting guide in the United States?”
“I did, sir,” the guide said ruefully, “but I believe we are now lost in Canada.”
To market to the affluent, you must know where they are and
how to find them. In this book, I will guide you directly to them.
If you’ll forgive, one more hunting story . . .
A man who regularly suits up and goes off with the other guys into the woods for days on
end, suffering wet, cold weather, to hunt, leaving his wife a weekend widow, is finally con-
fronted by her—she wants to go along and see what is so exciting. Grudgingly, fearing the
worst, but wary of endless alimony, he gets her a camouflage outfit, boots, a gun, and
NO B.S. Marketing to the Affluent
xvii
PREFACE / HOW TO USE THIS BOOK TO GET VERY RICH
brings her along. He stations her at the bottom of a hill, in a stand of trees, and tells her, “I’m going up the hill with Ben and Tom. If we flush deer out, they’ll come down this hill right in front of you. Just point and shoot. We’ll come ‘a-running.” He and his friends climb the hill but barely get to the top when they hear a gun blast and his wife and some other man yelling. They race back to the bottom, to find her pointing her gun at a guy standing next to a dead horse. He says, “OK, lady, OK, it’s a deer. Can I at least take my saddle with me?” To successfully market to the affluent, you must know not only where they are but what they look like. In this case, I don’t actually mean just their physical appearance. I mean owning a very clear and complete picture of who they are, how they think, what they want, what they detest, and how they make their buy- ing decisions—because they are a very different creature than what you have been accustomed to dealing with. The third purpose is to present a collection of strategies for successfully marketing to these affluent customers and, ulti- mately, to put it into the context of a step-by-step system. Let’s take these three purposes in order: First, to quote the advice given to Woodward and Bernstein by Deep Throat about the Watergate investigation: follow the money. As you progress through this book and subsequently go looking where directed, you are going to discover that there is an ocean of money out there, changing hands by the minute. This picture is contrary to what the media would have you believe about a slow and troubled economy and a population of broke people struggling just to buy milk and diapers. This picture may be contrary to the one you see and operate your business in, which is exactly the point. Dr. Edward Kramer, an early pio- neer in success education, said that even a tiny and insignifi- cant penny held close to the eye can block the sun. I find most xviii NO B.S. Marketing to the Affluent PREFACE / HOW TO USE THIS BOOK TO GET VERY RICH
businesspeople are just so myopic. Blocking their discovery of
untold opportunity for extraordinary income and profit by fol-
lowing the money to the affluent is a picture of the poor held too
tightly to the eye. Most business owners think that customers for
whom price is irrelevant are as rare as unicorns trained in ballet,
so they never set out deliberately to attract and do business with
them. In truth, there is a giant, growing availability of such cus-
tomers. Your view of the prosperity waiting for you will change
with this book.
To the second, while I have been the most serious student
and highly paid practitioner of direct marketing for 30 years, I
have been most seriously studying and devising special market-
ing strategies for the affluent for the past 5 years. I write a monthly
publication, the No. B.S. Marketing To The Affluent Letter (in addi-
tion to the regular No B.S. Marketing Letter), born by demand and
opportunity. The explosive growth of the emerging mass-affluent
and affluent populations made this specialized focus irresistible.
The response to that newsletter and the information it provides
led to this book. In everything I’ve ever done in marketing, the
two things that have had the greatest positive impact for the
greatest number and diversity of business owners have been
educating them about price elasticity and about marketing to the
affluent.
We are in the midst of a demographic revolution, with the
baby boomer population peaking, the mass-affluent population
exploding, and the affluent population growing richer per capita,
all converging to produce a new “spending class.”
Opportunities to trade up, to upgrade your clientele, to re-
arrange your business, its presentation of products, services, and
prices to attract upscale, more freely spending consumers have
NO B.S. Marketing to the Affluent
xix
PREFACE / HOW TO USE THIS BOOK TO GET VERY RICH
never been better. The retailers’ antidote to big box stores and online commoditization, the professionals’ antidote to cheap-fee competitors, the service companies’ antidote to cheap discoun- ters and bait ’n’ switchers, everybody’s immunity to recession is: the customer for whom price is not the issue! Now the popula- tion of such customers is growing exponentially and rapidly. You need to understand them, realize how abundant and plentiful and obtainable they are (possibly contrary to your own limited perception), and learn to target and attract them. You will under- stand the psyche of the affluent customer and be able to market to his aspirations, values, and mind-set as result of this book. IF YOU WOULD CHOP OFF YOUR OWN HAND WITH A DULL AXE before letting it hand over your credit card to buy a $4,195.00 cloth purse or spend $8,000.00 to fly somewhere private that Southwest goes to for $49.00, or join former Senator John Edwards at the salon for a $400.00 haircut and then the architect’s office to plan a 26,000-square-foot home, or pay $6,200.00 for a hand-carved mahogany umbrella rack, then you do not under- stand the rich and are therefore banned from success in selling to them. This book’s mission is to introduce you to three groups of customers in a meaningful way—the rich or ultra-affluent, the affluent, and the mass-affluent—as well as three convergence groups, the ultra-affluent boomers, the affluent boomers, and the mass-affluent boomers. Here I give you six different golden keys to unlock six different doors, each leading to far greater financial rewards for you regardless of the business or sales career you are in. They are keys of understanding. Understanding the magni- tude of these customer groups, their explosive growth, their psy- che, their spending behaviors. xx NO B.S. Marketing to the Affluent PREFACE / HOW TO USE THIS BOOK TO GET VERY RICH
Years ago, a client tried to hire me for a copywriting assign-
ment I foolishly rejected, for TV commercials for a home-study
course teaching fishermen how fish think, based on the premise
that to catch a lot of the biggest, fattest, most desirable fish, you
needed to know how fish think. Knowing nothing about fishing,
I thought the whole thing bunkum that no sane person would
buy no matter how clever my copy was crafted. I was wrong; the
commercials sold tons; I lost out on hundreds of thousands of
dollars in royalties. Oh well. It is, as we rich so often say, only
money. Now I tell you: you need to know how these rich think
should you wish to attract them.
Finally, third, you’ll be shown a systematic approach to con-
verting all this newfound understanding into actual attraction of
affluent customers. My life has been about building marketing
systems—and I am routinely paid upwards of $100,000.00 by my
private clients for doing so. Over 30 years, more than 85% of my
clients have returned to me for such assistance repeatedly. You
can be assured that the systematic approach I’ve prescribed here
will work for you—in any type or size of business, professional
practice, or sales career.
One of the best questions I’ve ever been asked, which I’ve
taken to asking others, is: Do you seriously, sincerely want to be
rich? If you do, you will use this book as a stepping-stone to the
road paved with gold, which leads to where all the wealth is. You
will go there without further delay, without hesitation, without
procrastination.
NO B.S. Marketing to the Affluent
xxi
PREFACE / HOW TO USE THIS BOOK TO GET VERY RICH
Important Notices from the Author References A massive amount of research, tapping into more than a hundred sources as well as the experiences of my own clients and of Glazer-Kennedy Insider’s Circle™Members has gone into this book. I have not turned it into an academic textbook, meticulous- ly footnoting each and every fact or statistic to its specific source or sources. Where only one source was used for a significant amount of information, it is footnoted. Otherwise, I have, in the “Resources” portion of this book, provided a lengthy list of web- sites including sites belonging to most of my research sources. The serious student motivated by this book will visit them all. Also, throughout the book, you’ll find “Recommended Resource” boxes in the chapters directing you to useful sources of informa- tion and assistance. I should tell you, delays between writing and having a book published are unavoidable. While every effort has been made to verify the accuracy of the information and to list only active sites and resources, it’s a safe bet that some of this won’t age well—even a few months can make a difference in the fast-moving world of marketing. The principles and strategies, however, will remain valid for years to come. Some updating of the information will be provided at www.NoBSBooks.com, in the section for this book. And the best way to stay connected to my most current information on marketing to the affluent is to sub- scribe to my No B.S. Marketing To The Affluent Letter, available at www.DanKennedy.com. Gender Language For those of you who are gender- or political-correctness sensi- tive, to head off letters: I have predominately used he, him, and so xxii NO B.S. Marketing to the Affluent PREFACE / HOW TO USE THIS BOOK TO GET VERY RICH
on throughout the book with only occasional exception, rather
than awkwardly saying he or she, him or her. I do not mean this as
a slight to women, only as a convenience. I am not getting paid
by the word.
Free Offer
I do not want our new relationship begun with this book to end
as one-night stand. I have a great deal more to share with you,
and it won’t take you long reading this book to realize there’s a
lot more to be gained from me than can fit here. To make the next
steps entirely risk free to you, I’ve made them cost free too. There
is an incredible Free Gift Offer on page 429, giving you more than
$600.00 in resources (at their publishers’ price value), including a
two-month “test drive” trial membership in my Insider’s Circle,
which includes my No B.S. Marketing Letter. During these two
free months, you’ll be invited to join me and other experts on
Webinars and Tele-Seminars. To be sure you don’t get side-
tracked and miss out, why not go right now, before doing any-
thing else, to page 429 at the back of the book and accept my
offer? It will take only a few minutes. Oh, I’ll remind you as we
go along, but the sooner you accept, the sooner all the good stuff
starts coming your way!
NO B.S. Marketing to the Affluent
xxiii
PREFACE / HOW TO USE THIS BOOK TO GET VERY RICH
“LUXURY is the first, second and third cause of the ruin of the republics. It is the vampire which soothes us into a fatal slumber while it sucks the life-blood of our veins.” —EDWARD PAYSON ROE, (1838–1888), MINISTER, CIVIL WAR CORRESPONDENT TO THE NEW YORK EVANGELIST, NOVELIST, STRICT MORALIST. “Let the bacchanal begin.” —DAN S. KENNEDY
BOOK ONE Who Are These People Who Have All the Money? Understanding Mass-Affluent, Affluent, and Ultra-Affluent Buyers
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have always wondered about the monkeys on monkey islands in our zoos. As we stand there looking at them, amused at their funny expressions and antics, are they enter- tained by looking at us in our funny clothes? Are the monkeys asking themselves, Who are these goofy creatures, anyway? I do know, from numerous conversations with my clients, that the rich are strange and odd and incomprehensible, that figuring out what motivates their behavior is as difficult as figuring out why the monkeys act as they do. While we’ll never need to decipher the monkeys’ thoughts and acts, we do need to decode the rich. 3 C H A P T E R 1 I Who ARE These People, Anyway? “With money in your pocket you are wise, you are handsome, and you sing well, too.” —YIDDISH PROVERB
We can begin by organizing the population itself. Through- out this book, I’m going to subdivide the affluent population many different ways: Ultra-Affluent Affluent Mass-affluent . . . and specialty market groups, like Affluent Boomers and Mass-Affluent Boomers Affluent Gays and Lesbians Affluent Entrepreneurs and Business Owners . . . and then by gender, women and men. These divided groups meet, converge, and also act separately. It is up to you to ultimately develop your own carefully defined target group within the affluent population that is ideally matched with your products, services, even your own personality. Let’s begin with some basic definitions. Mass-Affluent—Household incomes of $85,000.00 to $150,000.00 and/or net worth exceeding $250,000.00. This is the fastest-growing segment of the entire consumer market. These people are younger and more diverse than any previous affluent population in history. They include families with young chil- dren; single-parent households; blue-collar, not just white-collar, employees, as well as small-business owners. Demographic groups who just five years ago, and certainly ten years ago, would have been J.C. Penney® shoppers but now make some purchases there, some down at Wal-Mart,®and many up at Saks® and Neiman Marcus.® Affluent—Those with household incomes of $150,000.00 to $250,000.00 and/or net worth including primary and additional 4 NO B.S. Marketing to the Affluent CHAPTER 1 / WHO ARE THESE PEOPLE, ANYWAY?
residences’ equity, exceeding $1 million. In short, millionaires. As
many millionaires bemoan, being a millionaire ain’t what it used
to be! The status of millionaire, once rarified, is now mainstream.
We’ve had a two-decade millionaire explosion in America, and a
similar explosion is now occurring in a number of other countries.
It is within the Mass-Affluent in move-up mode and the
Affluent categories that we find what some demographers have
taken to calling “middle-class millionaires;” they are of a very
particular mind-set, which we’ll be talking about at length.
Ultra-Affluent. Those with household incomes of $250,000.00 up
and/or net worth of $3 million to $10 million. Here we find the
wealthiest 10% of U.S. households as defined by net worth,
according to the most recent Federal Reserve study. Their aver-
age net worth is $3.1 million, average annual income is
$256,000.00. They earn 36% of all U.S. income and control 70% of
the U.S. net worth. As a group, these 11 million households hold
89% of the value of all publicly traded stocks and mutual funds
in the United States.
Ultra-Ultra-Affluent. Household incomes of $1 million and up
and/or net worth starting above $10 million but more commonly in
the $20 million to $50 million range. Private jet owners* fit nicely
here—they have average yearly incomes of $9 million, net worth
in excess of $50 million. Average age 57, 70% men. Each year they
report spending $30,000.00 on wine and alcoholic beverages,
$150,000.00 at hotels and resorts, $115,000.00 on clothes and
accessories, $250,000.00 on jewelry, $500,000.00 on home improve-
ments and furnishings, and they have at least two residences. As
NO B.S. Marketing to the Affluent
5
CHAPTER 1 / WHO ARE THESE PEOPLE, ANYWAY?
*Based on study reported at www.MarketWatch.com.
a practical matter, their spending power is unlimited. Their ranks include Fortune 1000 CEOs, Hollywood celebrities and execu- tives, and professional athletes, but more than half are not famous or in exotic occupations or businesses but are, instead, “the millionaire next door” who has moved up. Many have built up and sold businesses or taken their businesses public, creating lump-sum wealth. Affluent Boomers. You’ll find a very lengthy chapter devoted exclusively to this, pardon pun, booming group actively explor- ing and even inventing an entirely new approach to retirement and Act 3 and Act 4 of life—and funding it with an unprecedented amount of spending power. I I I These groups, and other affluent groups, offer opportunity to marketers as unprecedented as is their prosperity, spending power, and attitudes about spending. In the chapters to come, you will see this new world of opportunity revealed. 6 NO B.S. Marketing to the Affluent CHAPTER 1 / WHO ARE THESE PEOPLE, ANYWAY?
NO B.S. Marketing to the Affluent
7
CHAPTER 1 / WHO ARE THESE PEOPLE, ANYWAY?
WHAT ARE THEY BUYING?
Purchases and Spending in Past 12 Months
Affluent
Ultra-Affluent
Home furnishings
80%
84%
Women’s evening apparel
43%
56%
Fine jewelry
37%
50%
Artwork, collectibles
10%
20%
Lifestyle Plans in Next 12 Months
Affluent
Ultra-Affluent
Invest: stocks, real estate
39%
55%
Remodel/renovate
39%
37%
Trip outside U.S.
37%
57%
Buy/lease new car
25%
34%
Cruise
16%
20%
Buy new/addt’l home
9%
13%
Based on 2006–2007 research data from Monroe Mendelsohn
Research/Mendelsohn Affluent Survey, 2007 (www.mmrsurveys.com).
Foreword How to Easily Attract the Affluent by Joe Vitale . . . . . . . . . xi Preface How to Use This Book to Get Very Rich . . . . . . . . . . . . . . . xv B O O K O N E WHO ARE THESE PEOPLE WHO HAVE ALL THE MONEY? C H A P T E R 1 Who ARE These People, Anyway? . . . . . . . . . . . . . . . . . . 3 C H A P T E R 2 The Ultra-Rich: Different Than You and Me . . . . . . . . . . . 9 C H A P T E R 3 The Question Freud Couldn’t Answer . . . . . . . . . . . . . . . 19 Late-in-Life Divorce as a Spending Event, 21 The Growing Population of “Cougars,” 22 Stigmas Gone, 23 iii C H A P T E R 1 Contents
iv NO B.S. Marketing to the Affluent CONTENTS Legal Discrimination, 24 It Isn’t Simple, 25 C H A P T E R 4 Boys Will Be Boys, No Matter Their Age. . . . . . . . . . . . . . 31 Status, 32 Men and Their Toys, 34 C H A P T E R 5 Marketing to Affluent Gay and Lesbian Consumers Is Out of the Closet . . . . . . . . . . . . . . . . . . 37 The Travel Industry Goes into New Territory, 39 C H A P T E R 6 Affluent Boomers’ Spending Boom. . . . . . . . . . . . . . . . . 43 The Big Wave, 44 What Do They Want? What Will They Buy?, 49 One of the Toughest Challenges for Marketers (The Death of Age-Based Advertising), 51 A Look at the Attitudes Governing Boomers’ Spending, 52 Sales Strategies, Tactics, and Tools, 57 Big Opportunities and How Businesses Will Adapt to Boomers in Coming Years, 62 C H A P T E R 7 Those Who’ve Gone from Poor to Rich . . . . . . . . . . . . . 77 Selling to the Self-Employed Affluent, 79 C H A P T E R 8 The 3⁄4-Full Glass. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93 C H A P T E R 9 Peer Deep into Their Souls . . . . . . . . . . . . . . . . . . . . . . . 101 What the Gates Really Are, 104
NO B.S. Marketing to the Affluent
v
CONTENTS
C H A P T E R 1 0
The Affluent E-Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
Recognition Does Matter, 113
B O O K T W O
WHAT ARE THEY SPENDING THEIR MONEY ON?
C H A P T E R 1 1
“They” Are Trying to Figure It Out . . . . . . . . . . . . . . . . . 119
C H A P T E R 1 2
What Are You a Merchant Of? . . . . . . . . . . . . . . . . . . . 123
What It Is Needn’t Determine What It Is, 126
C H A P T E R 1 3
Value in the Eye of the Beholder. . . . . . . . . . . . . . . . . . 131
C H A P T E R 1 4
Stop Selling Products and Services . . . . . . . . . . . . . . . . 137
A Great Ad Campaign Can Last Forever, 138
C H A P T E R 1 5
Products and Services for the Affluent
Go Mainstream Mass-Affluent . . . . . . . . . . . . . . . . . . 143
How Dare the Uncouth Heathens Invade Our Citadels, 145
C H A P T E R 1 6
How the Mass-Affluent Trade Up. . . . . . . . . . . . . . . . . . 149
Their Little Indulgences Equal Big Profit Improvements, 150
C H A P T E R 1 7
Thanksgiving Dinner Grandma Doesn’t Make. . . . . . . 155
C H A P T E R 1 8
Money Spent on Passions. . . . . . . . . . . . . . . . . . . . . . . . 159
vi NO B.S. Marketing to the Affluent CONTENTS C H A P T E R 1 9 Money Spent Collecting. . . . . . . . . . . . . . . . . . . . . . . . . 167 C H A P T E R 2 0 Money Spent on Kids and Grandkids . . . . . . . . . . . . . . 173 C H A P T E R 2 1 Money Spent on Pets . . . . . . . . . . . . . . . . . . . . . . . . . . . 177 C H A P T E R 2 2 Money Spent on Women . . . . . . . . . . . . . . . . . . . . . . . . 185 C H A P T E R 2 3 Money Spent on Bling. . . . . . . . . . . . . . . . . . . . . . . . . . . 189 C H A P T E R 2 4 Money Spent at Home . . . . . . . . . . . . . . . . . . . . . . . . . . 193 C H A P T E R 2 5 Money Spent Dining Out . . . . . . . . . . . . . . . . . . . . . . . . 199 C H A P T E R 2 6 Money Spent on Experiences . . . . . . . . . . . . . . . . . . . . 203 C H A P T E R 2 7 Money Spent on Liberty . . . . . . . . . . . . . . . . . . . . . . . . . 211 How to Make Yourself Magnetic to the Affluent, 216 B O O K T H R E E HOW CAN I GET THEM TO GIVE ME THEIR MONEY? C H A P T E R 2 8 No Boundaries Anymore. . . . . . . . . . . . . . . . . . . . . . . . . 221 The Internet as Great Liberator, 224 C H A P T E R 2 9 Recession-Proofing Your Business. . . . . . . . . . . . . . . . . . 231
NO B.S. Marketing to the Affluent
vii
CONTENTS
C H A P T E R 3 0
Affluent Consumer Entrapment. . . . . . . . . . . . . . . . . . . 239
Problems and Solutions, 249
C H A P T E R 3 1
We Know Where They Live . . . . . . . . . . . . . . . . . . . . . . . 257
How Much Do We Know?, 264
C H A P T E R 3 2
You Need to Choose Your Words Carefully . . . . . . . . . 273
Out of the Mouths of . . ., 281
C H A P T E R 3 3
The Language of Membership . . . . . . . . . . . . . . . . . . . 303
C H A P T E R 3 4
You Need to Get Client Referrals on
Purpose, Not by Accident. . . . . . . . . . . . . . . . . . . . . . 309
Peer Recommendations Rule, 312
C H A P T E R 3 5
Banish the Ordinary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 319
C H A P T E R 3 6
How to Create Unique Value from Thin Air . . . . . . . . . 325
Illustrate Your Process, 325
Elevate Your Status, 326
Make Your Clients Qualify to Do Business with You, 328
C H A P T E R 3 7
Every Marketer to the Affluent Should Be
in the Information Business . . . . . . . . . . . . . . . . . . . . . 333
Path 1: Get Published or Publish Yourself, 335
Path 2: Promote Yourself as Author and Expert, 336
viii NO B.S. Marketing to the Affluent CONTENTS Path 3: Publicity, 336 C H A P T E R 3 8 Who Can Have the Highest Price? . . . . . . . . . . . . . . . . 341 C H A P T E R 3 9 Price, Profits, and Power. . . . . . . . . . . . . . . . . . . . . . . . . 345 Stop Striving for Lower Prices, 348 C H A P T E R 4 0 How to Raise Prices without Raising Prices. . . . . . . . . . 357 C H A P T E R 4 1 Price Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 361 The Secret of Selling Big-Ticket Items, 361 The Slack Adjuster, 363 Ascension, 364 The 20% Factor, 365 Upsells, 365 Charge for What Was Free, 366 C H A P T E R 4 2 The Trouble with Having Money . . . . . . . . . . . . . . . . . . 371 C H A P T E R 4 3 Personal Confidence . . . . . . . . . . . . . . . . . . . . . . . . . . . 387 C H A P T E R 4 4 Political Commentary, In Defense of the Affluent . . . 395 If You Eat the Rich, You Will Soon Starve, 398 How to Set the American Economy Back to the Stone Age Almost Overnight, 400 Refuse to Be “Played” with Guilt by the Socialists, 402
NO B.S. Marketing to the Affluent
ix
CONTENTS
B O O K F O U R
RESOURCES
Sources of Information in This Book and
Other Resources of Interest. . . . . . . . . . . . . . . . . . . . . 407
Websites about Boomers, 412
Magazines to Read—To Better Understand the Affluent, 412
TV to Watch, 413
Places to Go—To Better Understand the Affluent, 413
Resources to Better Understand the
Philosophy of the Affluent, 413
Reference Books, 414
Other Books by Dan S. Kennedy, 415
About the Author, 417
Partial List of Authors, Business Leaders,
Celebrities, etc. with Whom Dan Has Appeared
on Programs with as a Speaker, 418
Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 421
The Most Incredible Free Gift Ever . . . . . . . . . . . . . . . . 429
Dan S. Kennedy, No B.S. Marketing to the Affluent, ©2008, by Entrepreneur Media Inc.
All rights reserved. Reproduced with permission of Entrepreneur Media, Inc.
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