Interaction between target and mailing characteristics in direct marketing, with an application to health care fund raising

The major decision variables for the development of a direct mail campaign are the characteristics of the mailing and the characteristics of the tar ets receiving the mailing. Traditional direct mail research treats both aspects separately although a they are likely to interact. We present a new target selection strategy that simultaneously takes both characteristics into account by using different mailings offering the same product to different targets. Using data from an experiment conducted by a Dutch health care organization, we show that our selection strategy increases the net returns of a fund raising campaign. (C) 1997 Elsevier Science B.V.