THE DIRECT APPROACH: Simon Marshall and Mike Cavers of Publicis Dialog explain how working out return on investment

Simon Marshall and Mike Cavers of Publicis Dialog explain how working out return on investment is more than merely measuring the response to an ad campaign.

Are creative standards in the industry improving or is there too much pressure on results at the expense of creativity?

The problem is not so much the pressure of results that affects creativity, it's just that only one set of results are usually measured. Put another way, direct communications are not being judged for their total impact but on the factors we can measure most easily.

Since the first pressure for measurement is invariably on response, followed by conversion and return on investment, these dominate judgment of what is good or bad communications. But what about the other effects - particularly on those consumers who didn't respond?

With people being bombarded with upwards of 3,000 commercial messages a day, the opportunity to be missed is a very real one. So any connection a brand makes with a customer or potential customer has to leave a positive impression. A communication that does not is wasted, and one that actually irritates will have a detrimental effect.

Brands really have to understand all of their connection points with customers and ensure that all communications reflect the brand and are relevant. There's often a major disconnect between high-value brand-building broadcast activity and tacky direct mail. Most of us recognise that communications are not simply a vehicle for conveying brand values; they are part of the brand. So, cheap communications cheapen the brand. The brands that achieve a proper understanding of customer connection points and the need to be consistent, tend to produce communications that enhance brand value, get response from their target and leave brand saliency in the mind of non-respondents.

There are a couple of major factors that make a new approach even more important now. First, we already know that consumers are getting much more assertive in how they deal with brands. Recent Publicis research showed that, while 94 per cent of adults claimed to have made at least one complaint in the last year, 80 per cent had also hung up from a call or walked out of a store in the same period.

Second, public attitude to direct mail is hardening: the problem of falling response rates, particularly in financial direct mail, is well known.

Our research also reflected the view that direct mail is a major cause of irritation. In the minds of the public, it's only surpassed in the annoyance stakes by door-to-door selling and telemarketing. The fact that "only" 20 per cent of the Electoral Roll has opted out should not be a source of relief. Although many in the DM industry expected it to be higher, it should be seen as a warning.

In the direct world, data and appropriate targeting play major roles in ensuring relevance and avoiding unnecessary annoyance.

The irony, though, is that with data targeting getting more sophisticated, more direct mail now happens on a broadcast scale and consequently is increasingly irrelevant to most recipients. The point about creativity is that what you say and how you say it are of equal importance. We must acknowledge that DM is intrusive unless relevant, that consumers are getting more marketing savvy and sensitive to spin. Even with current non-respondents, getting the tone right now may mean a better response next time. In research, recipients could readily refer to examples of direct mail they liked and appreciated; although they did not respond in the traditionally measured way, they would be more receptive to the brand in the future.

If communications can add value, are honest about their purpose, have a relevant offer, or even just entertain in a tone that is engaging and human, they will produce positive long-term effects, as well as maximising immediate return. A good example of this, and one of our favourite stories, is the follow-up letter one of our team received from Direct Line Rescue on returning home after a holiday breakdown and subsequent call-out. The letter did nothing more than "make sure" that all went well with the service and that the member got home safely. No reply/cross sell or cunning "marketing" questionnaire, just old-fashioned good manners. Oh, and the service was great as well! The letter helped turn a satisfied customer into a confirmed Direct Line loyalist and evangelist. It may be that no-one has ever measured the "ROI" of that letter, but the "return" is there, nonetheless.

So, certain sectors are improving creative standards while others are still guilty of churning out lacklustre mailings. In the financial sector, where an estimated 2.2 billion mailings are sent per year, responses are at an all-time low. This could indicate that creative standards probably aren't improving, but there are some heroic exceptions. Yet in other sectors such as automotive and FMCG, the ante has been upped, creatively speaking.

Creativity can add value to the relationship with consumers, once direct channels are appreciated, planned and budgeted as having impact beyond pure response. This may be as simple as investing in creative and production values and campaigns that reinforce brand values, but which should not be allowed to be judged against the "traditional" DM ROI. Moreover, certain activity should solely be about adding value without asking for anything in return: free value-added information.

Marketers and agencies should revisit the whole concept of how and when customers connect with their brand. Connection should resonate at both rational and emotional levels. Evaluation tools should therefore look beyond response.