Dr. Jeremy Weisz: 18:37
So yeah, we’re looking by the way, if anyone’s watching the video here or if you’re listening to the audio, we see there is a page on And Rick’s website here. And I’m just in the work page and I like to poke around to see this, and it’s like, it’s pretty amazing. You’re looking at about 1.5. Yeah the AT&T. AT&T.
1.5 billion pieces of direct response marketing just in this one campaign. That’s pretty wild.
Rick Rappe: 19:04
Well, that was ten years of my life.
Dr. Jeremy Weisz: 19:06
Well, I understand.
Rick Rappe: 19:07
Working for AT&T and I counted up the pieces of mail that I sent, but we do you want me to talk about that? Yeah.
Dr. Jeremy Weisz: 19:14
Go ahead. Yeah.
Rick Rappe: 19:16
Well, as a young person, I was able to work at a big agency, and one of the accounts that I started working on was the AT&T program in the southwest region. So my clients were in Dallas, Texas, and we were doing direct mail for just that southwest region. And then AT&T recognized that the results that we were getting were astronomically higher than all the other regions were getting. So we became the national AT&T sales channel and scaled that channel up to a massive size. So I was managing a direct marketing budget for AT&T of about $100 million a year.
And was able to manage a program where we were mailing every single day. For AT&T and did that and kept that program growing for over ten years. So that was a very, very successful program. And it became like I would say, probably driving 20 to 25% of AT&T total sales was from direct mail back then. So it was a great learning experience that that was probably that was that was obviously a really fantastic learning experience for me to be able to use that much, have that much budget and test and measure and do anything that I wanted in the course of things.
Dr. Jeremy Weisz: 20:41
I’d love to hear. Rick. And we’ll talk about there’s some guiding principles that you took from, you know, this AT&T that obviously you bring into RPM. But I do want to talk about what has surprised you either on the good or bad side. Like, to me, it seems a little counterintuitive, maybe to, okay, we’re going to send a bulkier, bigger catalog and get better response.
Right? Or what have you been surprised with like, oh, you’re like, I think this may work, but may probably not. And it really worked. Or and or on the flip side, oh, this is going to kill it. And then crickets. What surprised.
Rick Rappe: 21:21
You? That’s a good question. You’re going to make me feel figure out what my biggest failure was.
Dr. Jeremy Weisz: 21:27
Exactly.
Rick Rappe: 21:28
I can tell you some of the six I’m going to focus on the first part of your question, the successful things. We like to develop formats that have little interactive elements. So like instead of a self-mailer that folds together Other perfectly. We’ll have like one panel that’s off and has kind of a reveal edge. That little that little tweak makes it kind of easier to open and also makes it more interactive.
And those things can really help response or like a zip strip, something that’s die cut so that when you pull it, it goes and opens up, you know, and that.
Dr. Jeremy Weisz: 22:07
Kind of satisfaction to that.
Rick Rappe: 22:08
Yeah, there’s sort of like they demand that you that you pull them or we recently got a really significant lift in performance for one of our largest clients with a embossed paper stock on the envelope and kind of a die cut shape that hangs out on the backside of the envelope, which is really interesting. But these little sort of unusual things stand out and demand that people, you know, pay more attention and interact with the piece. But yeah, I think scratch offs and like pop-out, pop-out panels and zip strips and reveals and little tabs that, you know, those types of things can, can really help. So we definitely spent a lot of time mailing the standard formats that you would see in direct mail. But a lot of times we take those and we kind of improve upon the basics.
Dr. Jeremy Weisz: 23:10
As you’re thinking of some that you were overconfident about, it didn’t work. I would love to talk. So think on that for a second. I do want to hear that, but I do love hearing the interaction piece. Like to think about how do people improve what they’re doing.
I mean, this goes with anything, even with that same method applies with social media or anything, right? Like just the getting interaction. I know if I got something that was kind of like off, I’d want to rip it open because I wanted to like, line it up, you know, like my mind. So it’s like psychologically interesting to hear that. So before you talk about maybe what you were overconfident about, but the outside of an envelope.
Right. What are some of the things that maybe should and shouldn’t on the outside? Because I know, you know, there’s an A pile, B pile and C pile. And like if I look at it, it may go right in the garbage. Right. And so people, no matter how good the offer in inside is, if the outside is bad, I’m not looking or, you know, people aren’t looking at it. Right.
Rick Rappe: 24:20
If you know about the A, B and C pile, you know a lot more than most people know about direct mail. You’re talking about the way that people sort their mail when they come in from the mailbox. And the post office has studied this extensively, right? So people do the first sort where they put junk mail in one pile, promotional, obviously promotional mail, and then they’ll put, you know, personal bills and official mail in another pile and they’ll put like personal correspondence, greeting cards, those types of things, and personal letters in a third pile. And that’s, you know, obviously everybody does it a little differently.
But yeah, that’s good that, you know, that that’s interesting. As far as the what on the envelope works. Yeah. Like how do you get.
Dr. Jeremy Weisz: 25:06
Your stuff into the B and a file. Right. Like. Yeah.
Rick Rappe: 25:10
Yeah. Well, promotional envelopes can work with the offer right on the outer envelope. That’s okay. Sometimes. And it certainly is something that we do.
And it performs in certain instances and for certain clients, certain offers. We use that approach in internet and cable quite a lot. Other clients, for example, like the home warranty client that you mentioned, we do much more official mail for them, things that get into the pile that you know, where the initial reaction is, sort of, what the heck is this? You know, like it’s something official. I got to open this to figure it out and find out more.
So that is a much more effective approach for a lot of clients. That official or stealth approach, we call it, where it’s just not there’s nothing on the outside that that even for the AT&T program that I mentioned, where we were essentially giving away, you know, free phones we were using oftentimes a stealth envelope, a blind, stealthy envelope was like our top performing control package for many, many years.
Dr. Jeremy Weisz: 26:17
So when you say stealth, just describe it. I think there’s no like return address. Like talk about the outside, what that looks like for people so they can visualize it.
Rick Rappe: 26:27
Yeah, a stealth envelope would be something that’s. Yeah. Like doesn’t really say it doesn’t have a brand on it. It’s like got a return address only and it might have a stamp on it so that it looks like, you know, you can’t necessarily tell that it’s direct mail. Or as easily tell it’s direct mail.
And no copy on the outer on the outer envelope at all. So that’s a top performer for a lot of clients out there. I mean, if you study direct mail, it’s very widely used.
Dr. Jeremy Weisz: 26:59
Have you found people using any handwritten technology with outside because like when I think of getting in the A pile, right. It’s like almost like a handwritten address thing. And maybe that gets into the AI conversation, which you were talking about before we hit record of like, how is, you know, AI changing direct mail, but talk about that for a second.
Rick Rappe: 27:25
Handwritten direct mail has been around for a very long time, believe it or not. It’s not anything new, but it’s definitely something that works. And, you know, we use sometimes handwritten elements in the direct mail piece where you like on a letter, you might circle the offer and have little call outs in the margin. Those types of things can work really well, but in a handwritten envelope is we can obviously now we can kind of mimic the look of a hand handwritten font. But there’s actually companies out there that use pens and have computers that will handwrite.
And there’s even ways that you can actually have people do the handwriting and actually write the address block of your letters. So there’s a wide variety of ways you can do that. But yeah, we do a lot of packages. We have done a lot of packages that look like greeting cards, and they’re very convincing. And that’s one of the that’s one of the ways to make the greeting card package work is to make sure that on the outside it is very convincing.
Dr. Jeremy Weisz: 28:26
So we’ll talk about how I some of the stuff on AI and how AI is changing direct marketing, but I still want to go back to anything that you thought was going to work really well And.
Rick Rappe: 28:38
Yeah. And didn’t. Yeah.
Dr. Jeremy Weisz: 28:40
Yeah. Because like I’ve gotten, you know, ten different copywriters response marketers in a room talking and it doesn’t, you know, even the best ones in the world will not they’ll they think it’s going to work and it doesn’t for whatever reason. Maybe it’s a list. Maybe it’s what the what was sent, I don’t know. So what was on your list of like, this is definitely going to work.
And then maybe it just didn’t work like you thought.
Rick Rappe: 29:10
I think I’ve had a few clients that have led me down a path towards the idea of using sort of life stage data and, and segmentation model data, which would be like a prism codes or. Something that tells that that segments the population into different types of people. And then saying based on that segmentation model, we’re going to personalize like the images and the copy to fit that segment.
Dr. Jeremy Weisz: 29:42
Like if you send a.
Rick Rappe: 29:43
Signal.
Dr. Jeremy Weisz: 29:44
To, like a Hispanic community or whatever, and like maybe the creative would be more like the pictures of people that look like them or are Caucasian or whatever it is, that kind of thing.
Rick Rappe: 29:55
Yeah. Or it might say that we have one segment that’s like retired, elderly, retired versus young up and comers. And we’re going to customize the images for elderly retired and young up-and-comers. And we’re going to kind of try to personalize the packages for these two groups. And that in theory sounds good.
And it works. It sounds like it’s going to work, but it’s just really hard to execute against all the different possible, you know, versions that you would have to create. So it ends up being a very expensive idea to pursue and to execute on. And then it doesn’t. It almost never pays off in the results. It’s not justified. It doesn’t create enough of a lift to pay for the amount of extra money that is needed to pull it off.
Dr. Jeremy Weisz: 30:47
Especially if it’s, I guess, more like a wide stream product as opposed to like there’s probably products that cater only to 60. Like I’m just thinking of like hearing aids or something, like you’re not sending it to like an up and comer. So like literally all the lists are this, these people. So it’s speaking directly to just one.
Rick Rappe: 31:05
Yeah. If we know about the if we have a target, a specific target market for hearing aids or something like that, for example. Yeah, we’re definitely going to talk to that market and customize things to that market. No, this is more of a where people want to get into a segmented approach and start personalizing the mailing for different segments on a product that is more, you know, for a little bit more for everybody. So there’s ways to do it in a light way where it can I think it can help, But I just had some clients that took it, took the idea and really pushed it.
Tried to push it too far.
Dr. Jeremy Weisz: 31:42
Yeah. So talk about AI and how AI is changing direct marketing, if at all.
Rick Rappe: 31:51
Yeah, well, I think obviously we’re able to use things like ChatGPT and Claude to develop creative and to write copy, and that’s been an interesting resource. And we’re certainly utilizing that. You know, in conjunction with our copywriters who have years and years of experience in direct mail and direct marketing, but it’s just a great way to generate ideas really quickly. So that has been something that we’re embracing and continuing to work with. The other thing that I think is really exciting about AI is just it’s created a lot more speed in terms of doing things like predictive modeling and predictive analytics.
So used to take us a month to create a predictive model, and we would have to have a team of statisticians working for that period of time to create a really effective predictive model. And it wasn’t very accessible unless you had a big, big client like AT&T or, you know, somebody that size. So now it’s much more accessible for everyone, and we can create a very, very effective predictive model in a matter of minutes with AI. So that’s pretty exciting. We actually did a test where we let the statisticians create a model. And we had I create of.
Dr. Jeremy Weisz: 33:16
Course, you did a test.
Rick Rappe: 33:17
In and we created a model with AI in 15 minutes. And we tested the two against each other. We mailed 100,000 pieces of each one. And the AI-created predictive model did two times the performance of the one that was created by humans. So it’s very interesting.
Now, I there could have been a few other things that contributed to that, but it was just the speed advantage is really compelling.
Dr. Jeremy Weisz: 33:43
Obviously I expect nothing less than you testing those things.
Rick Rappe: 33:49
That’s the only way you know for sure is to test what’s the.
Dr. Jeremy Weisz: 33:54
So talk about some of the guiding principles that you took from, you know, running the AT&T campaigns.
Rick Rappe: 34:01
Yeah. Well, I think the first one we’ve kind of touched on already, which is that we have to be able to test and crack the code very quickly. And even before we have to get into a test, I should mention one of the most important guiding principles is establish a clear objective and make sure that the metric that you need to hit is very clearly defined. It cost per sale is a very good metric to use in direct mail. That’s a that one obviously includes performance metrics, but it also includes the cost metrics, so I’m a big advocate for that.
And I think some of the other guiding principles that I out of, out of my AT&T days were, you know, to really develop a channel building multiple program kind of strategy. So understand this is what we’re going to do at this stage. And then the next stage we’re going to do this and the next stage we’re going to do this. And it you know there’s a there’s a process to building a channel. Staying in the mail consistently is a very important guiding principle, especially if you’re working with a sales force and you’re integrating with a sales organization, continuing to maintain that steady lead flow so that they learn to work the leads and convert the leads effectively is really important.
And the other thing I was going to mention is just managing risk. We. Obviously, once we have a winning package, we want to make sure that we protect that and stick with it and don’t tweak it and don’t break it. But we also want to take. So 80% of our mind is saying, don’t mess with the control package.
It works. 20% of our effort though can be what else should we test? And continued testing. And we keep testing against the control to try and beat it, because we do know that the control eventually will fatigue. And once if you run into market fatigue, you have to have something else that will replace it. And so you want to be testing to find out what to figure out what’s next, I guess you’d say.
Dr. Jeremy Weisz: 36:15
Yeah, I love it.
Rick Rappe: 36:17
Those are some of the big ones.
Dr. Jeremy Weisz: 36:18
Clear, objective test channel building strategies have that kind of plan and consistency and then just managing the risk as well.
Rick Rappe: 36:27
And I would say if anybody that’s listening is really interested in my guiding principles from AT&T. Send me an email at Rick at RPM, dm.com and I’ll send you an email with the guiding principles.
Dr. Jeremy Weisz: 36:43
Cool. So you’re super successful in at AT&T right? They moved everything to what you were doing with direct mail and the company. Why leave then?
Rick Rappe: 37:02
Well, I did that for ten years, and I had a big team of people working for me at the, at this large agency. And I just got really fed up with corporate life, I guess you could say. And the struggles of working at a big agency caught up with me. And I finally just said, you know, enough is enough. I need to I need to venture out on my own.
And I think I was I was struggling with some of the problems that you face in a big agency, which is lots of bureaucracy. Agencies end up having a lot of junior level people that are managed by, you know, more senior people. And so, you know, that can be a struggle and difficult at times. And it’s not really very great for serving clients needs. So I just decided that it was time for me to venture out on my own.
And I really wanted to start an agency that was smaller and more nimble and better, better suited to meeting clients needs. And I think I was able to build RPM with that in mind. So that’s what that’s what we’ve done.
Dr. Jeremy Weisz: 38:12
For you now, Rick, obviously not everyone has $100 million a year budget. What other type of clients do you work with?
Rick Rappe: 38:21
Yeah, we work with regional companies, internet and cable companies sometimes, you know, home warranty companies. Different home services companies will come to us, and they may not be national brands that you would recognize, but they’re, you know, regionally focused and big enough to have a need for direct mail and the desire to do it, you know, really effectively. And that’s where we really come alongside their marketing team and become a really good resource because I think, like you said, you know, you said your goal is to make it easy for your clients. And that’s the same with us. We want to make it easy for our clients to build direct mail into a really highly successful channel.
Dr. Jeremy Weisz: 39:07
So is there any.
Rick Rappe: 39:10
Did I answer your question?
Dr. Jeremy Weisz: 39:11
Yeah. Is there any new things in direct marketing that you want to talk about? One of the things I like about direct marketing, too, is like they’re not changing the algorithm. Like, you know, like people are advertising on Facebook and Google. Like the stuff changes.
And just with the mail, I find it’s reliable. Like you said in the mail, right? It shows up maybe even less crowded these days, to be honest with you, but yeah. Is there anything new that that you have found that you want to talk about?
Rick Rappe: 39:50
Well, there’s a there’s a lot of exciting things that we can do with direct mail plus other things together, integrations with digital marketing. So we can obviously integrate and do. For example, we can do predictive lookalike modeling. So we’re finding we’re looking at your customers and creating that lookalike model that finds all the other people that look just like them or behave just like them. We hope.
And then we can target them with direct mail, but we can also target them with TV, radio, digital display at the same exact time. And so we can actually find their devices in their household and kind of create a symphony effect where everything’s landing at the same time. That’s obviously a powerful tactic and can be really effective. It’s one of those things where you also have to be aware of, like how much does it cost? Because it can be it sounds great.
It’s sometimes isn’t as great as it sounds because it’s expensive, but you’re maximizing your sales by doing all that at the same time. What else is new? I think there’s a lot of innovation right now in terms of how things are being produced. So there’s a lot more that we can do with high-speed digital color personalization. There’s things like that that are just changing and making mail more cost effective and bringing the cost down, or at least keeping the cost the same in an inflationary situation. So Those are some of the things that I that come to mind. I wish I, I wish I could.
Dr. Jeremy Weisz: 41:31
Think of target of like, you know, TV, radio, digital is that basically they have to having to interact with the direct mail first or, you know, like, like, are they snapping a QR code, like, how does it work? How does how are you doing that.
Rick Rappe: 41:48
In that particular case we can target without really them having to do anything. So before they’ve responded we can hit them right. Leading into when they’re going to get the direct mail piece with digital impressions and TV impressions and radio impressions. And then even right after they hit the mail. So it’s kind of like hitting all at the same time.
Dr. Jeremy Weisz: 42:10
So a multi-channel approach.
Rick Rappe: 42:12
Multi-channel omnichannel approach without them even.
Dr. Jeremy Weisz: 42:15
Having to take an action.
Rick Rappe: 42:17
Right, right. But oftentimes what you were saying with QR codes, I mean, there’s lots of ways to integrate direct mail with digital as a response channel as well. obviously we use QR codes on a lot of things. Use URLs to drive to web pages. And you know, sometimes we even integrate, you know, video into a direct mail piece through use of a QR code.
We can even buy a particular format of direct mail that has a screen and includes a video in the direct mail piece itself. That one’s pretty slick. And that’s something that we would like to do more of. It’s very interesting.
Dr. Jeremy Weisz: 42:59
First of all, I have one last question. And more along. Just mentors of yours through your business career. Could be colleagues, mentors and what you’ve learned. But I do want to just point people.
If you’ve been seeing the video. If you haven’t, you can check out RPM dm.com to learn more about Rick in the company and to check out the work they’ve done and some of the methodology that we’ve been talking about. And since, you know, we’re both a part of EO, I always like to ask, you know, mentors and some maybe lessons you learned from some of those business mentors.
Rick Rappe: 43:40
Yeah. Well, in the direct mail world, I worked at an agency for a period of time called the Current Organization, and I worked with the founder, Russell Kern. And I would say he’s been a mentor of mine. I’m excited because I’m actually going to have him as a guest on my podcast, and he’s a leadership consultant now because he was very successful at the current organization, and he is sold that company to a bigger, you know, New York holding company. And so I’m excited to talk with him as he’s one of my mentors for sure.
And I think he literally wrote a textbook about direct marketing.
Dr. Jeremy Weisz: 44:19
So I’ll have to look it up. How do you spell his last name?
Rick Rappe: 44:24
Kern. Kern.
Dr. Jeremy Weisz: 44:26
Okay, cool. Russell. Yeah.
Rick Rappe: 44:27
Yeah.
Dr. Jeremy Weisz: 44:29
And then it could be distant mentors, too. I know you read a lot. Or listen to a lot of books or podcasts. What are some of the resources you encourage people to check out that you love?
Rick Rappe: 44:45
Well, obviously I, I would say people like Bob hacker, Danny Hatch. Dan Kennedy, these are some of the some of the gurus of direct marketing that I have studied and, and pay paid a lot of attention to over the years.
Dr. Jeremy Weisz: 45:05
Yeah, I remember I think he sold the company, Rick. But Denny Hatch had what runs with or what was it called, you know, where he would send you, what’s been running and how long it was?
Rick Rappe: 45:17
What I think is, yeah.
Dr. Jeremy Weisz: 45:18
Who’s mailing what exactly? Yeah, totally. Love that. And I love, you know, I definitely love the Dan Kennedy stuff as well. Rick, thanks for sharing your journey.
It’s been pretty crazy. Who would have thought when you started working that you’d be like just running the AT&T and then parlaying that into helping others really be successful with direct mail so people can check out rpmdm.com to learn more. And also you can check it out. Check it out. Rick’s podcast, when you go on his page and you’ll see some legends on there that he’ll have on and they’ll talk shop.
So I’m looking forward to seeing those as well. Rick. And thanks everyone. And Rick, thanks so much.
Rick Rappe: 46:04
Thank you. Talk to you later.
