If you've ever watched someone sort their mail, you know that an outer envelope can mean the difference between a new lead, an engaged customer and a successful contact or a quick trip to the discard pile.

Techniques to improve open rates, such as color, personalization, closed-faced envelopes and one-to-one offers are known to work, but have traditionally involved too much money, too much time and too many capital expenditures for a profitable return. That's why the latest innovations in envelope finishing are so timely in today's market.

Innovative mailers and service bureaus can now print high quality, variable, full color text and images directly on envelopes - inline as part of their mail insertion work flow - all at production speeds. The economics of this new technology play out in three important ways: lower cost, improved response and greater flexibility.

Eliminating Preprinted Envelopes

One of the biggest shifts in the industry today is the move to a "white paper" production environment - where all variable data, logos, graphics and images are printed at the same time using digital print technology vs. the traditional process of printing variable data on pre-printed forms. When it comes to envelopes, you can start with straight-from-the-carton plain envelopes and add the logo, postage imprint, image, teaser message and address all in a single pass during the high-speed mail finishing process.

From a cost perspective, this eliminates the cost of preprints, storage and inventory management. On-the-fly printing also reduces the waste associated with overs, a common occurrence when orders for outer envelopes come in before mail quantities are finalized.

Because graphics and messages are all data-driven, production managers can also combine multiple mailings in a single job run - picking up economies of scale and minimizing job changeover costs. As an added advantage, mailers who presort can also achieve higher densities of three and five digit sorts, reducing overall postage.

Increasing Mail Piece Effectiveness
Not surprisingly, studies show that consumers are 70% more likely to open a mailpiece with color text and graphics on the front before opening pieces with no headline or graphic - and results improve even more when these messages are personalized.

The ability to print dynamic, relevant envelopes in a cost-effective manner is already providing some mailers with a significant advantage a critical edge when companies are looking to generate more value out of each and every communication they send. Many mailers are targeting one-to-one messages based on demographics, geography or past purchases. Some may even choose to sell space on the outside of envelopes to third-party advertisers - a premium ad buy as the outside of envelopes are read by each and every recipient.

In certain industries, we also see mailers switching to closed-faced envelopes, printing crisp addresses and barcodes directly on the envelope. In addition to the perception of added privacy, this change frees up space on the document and avoids postal issues that arise when addresses do not align with envelope windows.

Gaining Speed and Flexibility
Companies are used to making last-minute text changes to personalized letters, but envelopes are usually approved weeks - if not months - in advance of a mail date. One of the most valuable advantages of inline envelope printing comes from the ability to make changes right up until the mail is prepped. In terms of practical applications, this flexibility makes it easy to respond to competition, leverage insights from earlier mail drops, deliver event-based marketing or communicate last-minute service alerts with speed and efficiency.

Many such firms are already calling inline envelope finishing a "game changer" for one simple reason: these capabilities make it easier to make money. While a relatively new innovation, best practices are already emerging relative to these technologies. In particular, mailers and service bureaus have honed in on five factors that are critical to success.

1. Ease of integration. Inline envelope printers should be configured to work with your existing systems and data streams, so you can add new capabilities while minimizing capital expenses.
2. Ease of implementation. Users should have built-in tools that make it easy to author content and create dynamic messages. Likewise, mailers should be able to control and manage jobs intuitively, with tools to match colors, analyze ink coverage and optimize overall resolution and costs.
3. Print quality. With quick drying inks and image optimization tools, inline print quality should measure up to the quality expected.
4. Time to market. Lower capital expenses can help streamline budget approval, while systems set up for more "plug-and-play" installation can help minimize the need for in-house IT resources.
5. Added-value features. Hot swappable ink cartridges, for example, can help minimize downtime and keep your systems running. Other features, such as integrated print controllers, ensure that the same data being used for addressing and personalizing letters will work for your envelopes as well.

Business heads no longer need to be convinced about the power of color personalization. Today the market realizes that better use of relevant, variable messaging can increase revenue, order size and response.

Once you have the capabilities for variable color envelope printing, database and marketing analytics can help you or your clients segment customers and pinpoint high-potential opportunities. You can achieve meaningful results by applying basic segmentation strategies and, as you gain experience, create rules-based macros that generate more advanced segments automatically.

To create a simple segmentation strategy, identify one factor that may lead to a difference in customers' needs. For example, in auto leasing, that may be time left on lease: you can create distinct messages for those who are new, at mid-term or near the end of their lease. For a home equity loan, a person's available credit line may tell you whether you need to encourage activation and usage or add an additional credit line. A wide range of variables exist which can be used to target customers, including income, gender, geography, extent of relationship, participation in a loyalty program and more.

For more advanced segmentation, you can model likely buyers, calculate lifetime value of customers or overlay multiple criteria to create true 1:1 marketing programs. Geo-demographic data and cluster analysis, for example, can help a car manufacturer know whether to pitch an SUV or an ecologically-friendly Hybrid. The secret is to start small, build a track record of success and expand your efforts over time - adopting the test-measure-refine behavior of a direct marketer.

John Kline is Vice President, Global Inserter Solutions, Document Messaging Technologies, Pitney Bowes Inc. Visit www.pb.com for more information.