Private equity firm Apollo Global Management will take Rackspace private in the all-cash deal.
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My opinion-and accept it as an opinion-is that astute business practice usually opts for profit per thousand e-mails, because that’s a foolproof gauge.
Test your discounts.
One more test. A major food retailer tested 30% off everything available on the web site, 40% off everything on the web site, and 40% off selected items on the web site. Notification went to prior buyers only.
I personally registered two objections, one to myself and the other to my client: First, my experience has been that dollars-off has greater emotional wallop than percents off. But that was impossible for a site-wide offer, because it would have meant massive restructuring. The objection I voiced was that if this were to be a head-to-head test, the “selective” string was bound to wind up a distant third.
The results: The “selective” offer was so distant a third that tabulation isn’t worthwhile here. No surprise. Of the sitewide discounts, 40% off pulled more than double the number of orders 30% did! A freak? Maybe. But results are results. Actual percentages: 0.86% for 40% off, 0.42% for 30% off. Profit per order was $36 for 40% off, $44 for 30% off but profit per thousand e-mails was over $300 for 40% off, well under $200 for 30% off.
OK, what question isn’t answered here: What happened to the next “straight” offer to this same group?
These examples lead to three logical conclusions:
1) Internet marketers can forget their fears of identifying themselves, because we all have the same constraint and in quick order the technique becomes both standard and accepted.
2) Direct, straightforward, and benefit-loaded messages are the ones most likely to work, regardless of content.
3) Testing is the key to both constantly improved response and constantly improved competitive position.
We have a sophisticated medium. Our marketing has to reflect respect for and attention to that sophistication.