CDs getting more use as promotional tool

By DAVID RANII, Staff Writer

Faced with the task of hiring 300 to 350 new teachers in a highly competitive job market, the Durham Public Schools wanted to set itself apart from other school districts.
So it hired 21 CD, a digital marketing company in Durham, to produce 3,000 mini-CDs.

The disks, which it began distributing to prospective teachers several weeks ago, feature video clips of teachers and administrators talking up the school district. Internet links direct users to its Web site -- plus other sites of interest to anyone who wants to learn about Durham as a community.

Sure beats a brochure.

"There's a lot of marketing value in it," said Julie Marshall, communications coordinator for the Durham school district. "It underscores the progressive nature of our school, as well as our commitment to technology."

While such technology has been available for years, rapidly dropping prices of CDs and DVDs and the proliferation of devices that can play the disks -- PCs, CD-DVD players and video game players -- has significantly boosted their use for promotion of businesses, organizations and governments. The technology enables richer, interactive content, and offers the ability to track responses more easily.

Cambridge Associates, a Stamford, Conn., management consulting and market research firm, estimates that in 2003, the use of CDs and DVDs for marketing and other nontraditional grew 15 percent, to 490 million.

Still, obstacles to widespread acceptance remain. Even in this digital age, some computers can't read the disks, especially DVDs. And some consumers would rather flip through printed materials than deal with a CD.

The cost of CDs and DVDs previously hindered their popularity as marketing tools, but prices have fallen significantly.

A report Cambridge Associates produced for the International Recording Media Association found that producing and mailing 300,000 copies of a 50-page catalog can be much more expensive than producing and mailing the same quantity of CDs, and slightly more expensive than DVDs.

The Durham Convention & Visitors Bureau ordered 2,000 printed copies and 5,000 CD versions of a guide it uses to promote the area to executives who plan meetings and events for corporations and associations.

The 5,000 CDs cost $2.02 each; the printed guides cost $3.87 each, said Shelly Green, chief operating officer.

That doesn't count mailing costs, which can be a key area of savings. A catalog that is inches thick can be put on a mini-CD that can be mailed for just a single 37-cent stamp.

Improved response

Moreover, with disks, "you can combine video and text and audio all in one," said Adam Staelin, general manager of the Morrisville office of Minneapolis-based Allied Vaughn, a a leading duplicator of videocassettes, CDs and DVDs. "You can take people right to your Web site."

Richer content may explain why Cambridge Associates found that CDs and DVDs generated responses ranging from 50 percent to 600 percent greater than catalogs, brochures and other traditional direct mail.

"Catalogs have been around for years and people Frisbee them into the trash can a lot sooner," said Peter Nyberg, president of 21 CD, a 3-year-old agency that has grown to 11 employees.

But CDs and DVDs aren't for everyone. "You really have to know your market," Staelin said.

For example, a CD or DVD is worthless to some consumers, because they can't play them. As of last fall, 55 percent of U.S. households had a DVD player or another device -- a PC with a DVD drive or a video game console -- capable of playing DVDs, according to Cambridge Associates. About 60 percent of U.S. homes can use CDs.

If companies decide they do want to send out a disk, they have to choose between a CD and DVD. CDs are typically cheaper. DVDs have greater storage capacity and therefore have better-quality video, since video is typically compressed to fit onto a CD.

And, on the technical side, decisions have to be made on which computer operating systems the disks should be compatible with, said Will Feichter, president of Myriad Media in Raleigh. The four-person digital media agency specializes in writing and filming videos, and integrating them with the Internet and on disks, for corporate and educational clients.

Sticking a disk in a machine also takes more effort than just picking up a brochure and browsing through it. So you have to provide the recipient with compelling information about what's on the disk if you want them to make the effort, Feichter said.

To play it safe, some companies that mail out CDs include a card that recipients can use to request a printed brochure, said 21 CD's Nyberg.

Tracking customers

The company, which specializes in converting brochures and other printed materials to digital formats, also has developed technology that enables clients to track how disk recipients use them.

"We can see if people are looking at it and what people are looking at," Nyberg said. "In the last six to eight months, that is what clients have been most interested in. They are fascinated that they can get real-time data on the efficacy of their campaign."

Although users have to be connected to the Internet for 21 CD's tracking system to kick in, people who use broadband links are always online. Users with dial-up service are tracked only when they go online.

Last year 21 CD produced and mailed 10,000 CDs for the developer of Bald Head Island, promoting rental properties and the resort's attractions. Those CDs attracted more than 1,600 users, who checked out the disk an average of 1.5 times. That's a strong response in the world of direct mail -- where a response rate of a few percentage points is typical.

"It was a very successful campaign," said Trisha Howarth, Bald Head's hospitality sales and marketing director. "That's why I did it again this year."

Staff writer David Ranii can be reached at 829-4877 or dranii@newsobserver.com.

Reprinted with permission of The News & Observer of Raleigh, North Carolina.
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