Can you sell more than one product in your offer? (DM Notebook).

More than 30 years ago my first boss in newsletters, Ken Callaway, founder of Capitol Publications, briefly thought he'd found the Rosetta Stone for marketing.

For promotions for School Law News, Report on Education of the Handicapped, and other education newsletters he was publishing, the marketing packages were expanded to offer special reports on related topics. (The reports were public documents they'd found gathering dust on government shelves and reprinted with the Cap Pub logo on the covers, but that's another story.)

The strategy worked like a charm. The orders for special reports were paying the entire cost of the marketing campaigns and "the subscription orders were pure gravy."

Soon, however, Callaway decided that the special reports were cannibalizing his newsletter subscriptions. "We're selling professional guilt," he said, "and giving the prospect the chance to salve it with a $27.50 special report, rather than my $157 newsletter with the 'built-in' prospective renewal income, is not a good idea."

That has pretty much been the conventional wisdom from those early days until now-you cannot sell two products in the same envelope.

Now, however, Frank Lessiter at Lessiter Publications in Wisconsin has some revisionist thinking. He started out by including offers for special reports in renewal notices. A definite "no-no" under conventional thinking. But it's only done with the first couple notices in the series when the checks you receive are coming from the converted, those who might well not only renew but also be interested in a special report. Closer to and post-expire, the offers for special reports disappear from the renewal series because of the obvious distraction factor.

So, Labor Day 2002, Lessiter took the plunge and dropped 113,000 pieces of a combined package offering both the newsletter and a mini-catalog offering some 35 different special report titles.

Just as predicted

Response to newsletter subscriptions was down. Percentage response dropped some 29 percent from the previous Labor Day mailing. So, although the in the-mail total was 6,000 higher than in 2001, his anticipated five-year subscription profit was down nearly $4,000.

However, while this is unknowable, 2002 was a lousy direct mail year for almost all newsletter marketers. Is it fair to surmise that his 2002 response would have been somewhat lower than in 2001 in any circumstance?

The prospects who received the combined mailing purchased enough special reports to yield over $20,000 in profits after total production costs of the catalog.

The total number of special reports ordered was just about four times the number of subscriptions sold.

Plus, in mid-November Lessiter sent a follow-up newsletter subscription mailing to 1,200 people who had ordered special reports from the Labor Day mailing but had not subscribed. Response? Nearly two percent of that group subscribed, and 22 percent chose either the two-year or three-year offer.

Why this works for Lessiter

Frank Lessiter will probably continue the program. While a stand-alone mailing for the newsletter would yield a marginally higher response, doing a separate mailing of the catalog also would essentially eat up the entire profits in postage charges.

This works for him because he has a prospect audience he knows likes to buy special reports, which doesn't hold true across the newsletter industry.

Secondly, his pricing structure works for him. I worked with a publisher who made a similar offer, but included two special reports, priced at $35 and $49, with a newsletter offer at $247. A prospect who ordered both of the reports gave only about one-third of the subscription price of the newsletter.

Lessiter's newsletter sells for $44.95, and the offer here was "Save $10" at $34.95. The special reports were priced from $6.95 to $18.95, so the prospect who orders two or three reports is sending Lessiter an amount pretty much equivalent to a year's subscription revenue.