Direct Mail, Lower Leases
Is email enough, and what to ask your landlord
By Carol L. Schroeder -- Gifts & Decorative Accessories, 11/1/2009
Q: We use email blasts to contact our regular customers, but we're cutting back on all of our other advertising. Is this a good idea?
A: I'm a big believer in email marketing, and our shop uses email newsletters regularly to reach out to our customers. But even though these shoppers have given us permission to e-mail them, we only average about a 28 percent open rate. That means we are not reaching all of our existing customers, and of course these emails don't net us any new ones.
Email's limitations of make it necessary to include some other form of advertising in a marketing budget. In addition to traditional media (print, TV and/or radio), consider direct mail marketing. Direct mail has three main advantages over email: New addresses are available for customers who have moved; first class mail usually gets forwarded and list rental helps you reach new customers.
You will want to build the names on your mailing list in conjunction with your email list. This can be done through your preferred customer program (the most effective method for us); a signup form for a prize drawing or by taking addresses from checks. Consider having your list managed by a print-and-mail company that will keep it current and handle the mailing regulations.
Your customer list can be supplemented by renting a list of names and addresses that match your target customer. A toy store, for example, might rent the local subscription list of a baby magazine. These are provided for a one-time, specific use pre-approved by the list broker. You might also try working out a private arrangement, mailing to a local nonprofit or neighboring business' list.
Coupons and special event invitations make successful mailings, along with product news. For smaller mailing pieces, it is fairly simple to design something on your computer and upload it to a printing company. If you don't have the technical skills, advertise for a graphic artist on Craig's List, or check the local community college design program.
Some vendors provide mailers for store use. One of our favorite suppliers, Design Ideas, just sent out a postcard offering special terms (a sure way to a retailer's heart). But in addition, they offered the professionally designed postcard to their retail accounts. As Design Ideas points out, in a recession marketing budgets are cut, but that's when marketing is needed the most. They say that direct mail has fallen off, so direct mail pieces — especially colorful postcards like theirs — get noticed more. They quote a statistic stating that postcards are read by an average of six people. That extends the reach well beyond the customer to whom you mail it!
A postcard mailing costs more than an email piece, but it has a great chance of being noticed. But don't neglect your email list. It's important to use a combination of methods to reach out to your customers and draw shoppers into your store during this holiday season.
Leasing LessonsQ: We are feeling squeezed by our landlords — the anchor store in our mall has closed, yet they want a 10 percent increase this year. Is there anything we can do?
A: When you signed your lease, you may have been promised certain conditions, including the presence of an anchor store or an active program of promotions and entertainment to attract shoppers. If either of these factors is no longer valid, you may have grounds to void your lease, or at least lower your rent.
Today's tough economy has led to an increase in retail vacancies, so if your business is facing difficulties, you may be able to renegotiate your lease terms to keep your business in operation.
This is especially true if the conditions originally promised you have been altered. Be prepared to go over specific clauses in the lease, and bring statistics and a proposal to the table.
A retailer in our area was able to arrange a six-month delay in paying rent, however the half-year passed without great improvement in the shop's finances. Now instead of owing one month's rent, they owe seven. I would only suggest a rent deferment if you have a specific plan for how this will help you stay in business.
If you can't negotiate a reduction in rent, perhaps some leasehold improvements that the landlord could provide, such as new signage or energy efficient lighting, would help your business.
Banding together with others to present mutual concerns to the same landlord can help you make a stronger case to the property owner.
The best way to prevent a conflict with your landlord is to get professional advice before you sign the lease. You will want to know the length of the lease period, and whether you are allowed to sublet if your business fails. It is also important to know whether your own home, or other personal property, is on the line if you default.
Consider also that if your business is thriving, a lease can be too short. You will want an option to renew so that you can stay in your location, and without undue rent increases.
Your lease may well be the most important business document you ever sign, so be certain that you protect your rights — and get everything in writing — for the best chances at long-term viability for your shop.
| Author Information |
| Carol L. Schroeder is the author of Specialty Shop Retailing: Everything You Need to Know to Run Your Own Store, published by John Wiley & Sons. Send questions to orangetreeimports@mac.com. |




























