Chapter Ten. How to Keep Mail Order

No legitimate business today can run smoothly without records. The increasing number of reports required by various governmental bod­ies makes records almost mandatory. In the case of mail order, there are certain special records, not required by official agencies, that should be kept; these are records of the pull from individual media (advertising tally sheets) and customer lists.

Tally sheets designed for mail order are obtained at large stationery stores. Many advertising agencies distribute these forms as a service to their clients. However, the beginner with limited funds can use graph paper or hand-ruled forms that will be adequate. A tally sheet easily prepared on graph paper is shown on the next page.

Most mail order men record the orders received cumu­latively, but this is a matter of personal preference. We will assume that on Publication A, key no. 101, the first 5 orders were received on Oct. 20th, 3 on the 21st, 8 on the 22nd, 9 on the 23rd, 6 on the 24th; the 25th and 26th being the weekend, no mail was received; on the 27th, 33 orders sheet would then present this picture:

Note that the first entry was made on the October line under the 20 column, and that no entries were made for the 25th and 26th (the weekend). The tally is continued this way until the orders begin "petering out." Most firms run the tally on at least 5 or 6 months and then throw whatever still comes in under a general heading of "old keys."

In the above specimen, entries are recorded in the January and February columns, representing a continua­tion of the pull beyond December 31st. A separate page may be used if desired, but the advantage of seeing the whole picture at a glance is evident.

The heading on the sheet is for a publication, but the same form can be used for direct mail or radio-television. Merely insert the proper medium in the publication place, and the quantity of pieces mailed in the space-used line. The date becomes the mailing date rather than the issue date, and the price can be the total cost of the mailing or the per thousand cost.

Other information that may be carried at the bottom or on the back of the sheet is the number of C.O.D. refusals, refunds, unsolicited re-orders and a profit and loss statement for the particular promotion. Here is an example:

GROSS INCOME       $993.00
COSTS                          725.00
PROFIT                       $268.00

To the profit figure may be added the potential in­come from the sale of the names and from follow-up mail­ings which, experience has shown, will accrue to you over the years.

Customer Lists

The reasons for maintaining customer lists should be obvious to anyone reading this far. We will discuss only the simplest way of doing this. Merely attach, with paste or staples, the coupon to the original envelope the order came in; put all the other pertinent information on the side or back of the envelope. Type or write the shipping label and fill the order right from this envelope. File the envelope in a folder or corrugated box, arranged alphabetically by states.

The two big advantages of this system for the beginner are elimination of considerable paper work and accessi­bility of the original order, including the outer envelope showing the sender's postmark. Unfortunately, people do forget, by the time the parcel arrives, that they ordered something about a week or ten days ago, and demonstrate their ire and annoyance by writing to the postmaster, dis­trict attorney or better business bureaus about receiving merchandise not ordered. Sometimes a "friend" orders the stuff sent as a practical joke, naturally C.O.D. There follow "polite" notes from the post office, etc., requesting proof (i.e. the original correspondence) that complainant ordered the merchandise or service in question. What a relief for the newcomer to be able to supply the evidence!

This system has shortcomings. The records become bulky. The addresses fade and become illegible, especially the pencilled ones. Some firms type the names and order data on 3x5 index cards and file them in metal or wooden floor cabinets available at any office supply store. As the business prospers and the lists are used more frequently, it may be profitable to place the names on permanent sten­cils or metal plates. This decision should be made only after a careful analysis of the costs.

Cleaning Lists

Customer lists should be "cleaned" regularly. This trade designation means the removal of all undeliverable names from the active file. Usually, "cleaning" is done after a mailing to the list, with all mail returned by the post office ("nixies") as undeliverable for a variety of rea­sons such as:

Moved, left no address
Deceased Refused mail
Left employ—no forwarding address etc. etc.

Maintaining a "clean" list not only saves the postage and work of futile mailings but can actually mean the dif­ference between a profitable and losing promotion. A list "uncleaned" for two years may contain up to 20% unde-liverables and kill a weak offering. Let us examine an actual case known to the writer.

Firm A's product fell into the one-time sales category and it was unable to find a suitable follow-up product. It did manage to get additional income from the names through sales of the list to other users. As is customary, the companies would turn the "nixies" back to Company A, but the latter became negligent about "cleaning" the files.

About two years later, Company A obtained a product that seemed a natural for its list. Because it was a "house" list and large (about 120,000), a 10,000 test was decided upon. The results were marginal, leaving further mailing in doubt. An examination of the tally page showed the following:

The profit figure was, of course, inadequate for the investment and discouraged mailing to the balance of the list.

A careful analysis, taking into account the knowledge that at least 20%—2,000 of the 10,000 mailing—were un-deliverables, would have shown that the promotion was really successful but for the waste of $100.00 (for 2,000 undeliverables). Had the list been "cleaned," the pull for each 10,000 probably would have increased to 500 orders (because the pull of 400 was really for only 8,000) putting the profit figure at $187.50 per 10,000 and an estimated profit for the total list at $1,875.00.

Business Records

The ordinary business records should naturally be kept. Low-cost accounting services are available every­where, with fees often less than $5.00 per month. It is sug­gested that, price permitting, such a service be obtained.

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