It's easy to think you can overlook direct mail marketing campaigns with all the new digital marketing strategies out there. However, it's time to rethink that. Direct mail is still outperforming many other marketing channels and by combining direct mail and digital marketing, you'll quickly see your response rates across all platforms showing an increase in engagement, response, and brand awareness.
Direct Mail Still Works
And you don't want to miss out on this high performing marketing channel. Direct mail still gets the best response rate in a comparison performed by the DMA. The 2018 Response Rate Report shows that direct mail has the highest report the DMA has ever reported. Direct mail dominates other channels' response rates at 5.1% (compared to email at .6%, paid search at .6%, online display at .2%, and social media at .4%). The median direct mail household return on investment is 29%, behind email (124%) and only slightly behind social media (30%), but still higher than paid search and online displays. This is somewhat due to the low costs of social media and email blasts, but significant in terms of paid marketing strategies such as paid search results and online displays.
Still not convinced? For every $167 marketers spend per person on direct mail, $2,905 revenue is generated -- a return of 1,255%. In past years, direct mail has generated incremented sales of over $2.2 trillion and 80% of households read or browse their advertising mail... and find that print is 43% less annoying than the internet (Print is Big).
So how do you tap into this high performing marketing channel if you haven't already? Or, if you're already running direct mail campaigns, how can you improve them to get the best return on your marketing dollars? Here are five strategies to make sure your campaigns are hitting all the marks:
1. Data Drives Direct Mail Responses
The first step in any direct mail campaign is sourcing an accurate and fresh prospect list. The cost of using bad data is higher than you may think - poor data could cost you up to 30% of your revenue according to a report by Ovum. Spending a little extra on high quality data will save you more in the long run on saving you the cost of bad addresses, undeliverable records, incorrect names, etc. There are two ways to think about running direct mail programs: customer retention and prospect acquisition.
Customer Retention: Using your customer data can be beneficial in more than one way. Using data points to analyze your customer data allows you to identify trends, significant buying behaviors, and the top segments that make up your customer base. All of this information is useful for building predictive response models, as well as creating impactful prospect segmentation and targeting techniques. You can also gather data points you may not have on your customers, such as birthday, life event triggers, and more, in order to provide birthday offers, tailored product and service communications and discounts, as well as to personalize your offers. Studies show that personalized offers get a much higher response rate, and the top discount that customers appreciate the most are offers and discounts that thank them just for being a valued customer. This is an important marketing group that often gets overlooked, but it is 10 times harder to create new interest than nurture existing interest, so it's important to not forget about your current customer base in your efforts to grow!
Prospect Acquisition: If you do have customer data, you can use the significant attributes and behaviors to work with your data provider and build a custom predictive response model -- the lifts from using modeled data are well worth the extra effort, because that means you're targeting prospects who look most like your top customers and on average, are the most valuable prospects to reach. Otherwise, there's a variety of campaigns that you can opt into, depending on your industry and products. For many businesses, from retailers to financial institutions, new movers and new homeowners are an incredibly responsive prospect base. Otherwise, a good data provider will work with you to identify your most valuable segments, and create custom targeting based on geography and a variety of criteria to boost your marketing efforts. By using data that is constantly updated, multi-sourced, and quality checked, you'll be building high response prospect lists in no time.
Good data will also allow you to seamlessly integrate your direct mail efforts with your digital efforts - a huge factor in campaign success. It can take up to 18-20 touchpoints to reach a customer for the first time and build the trust required for them to take action on your marketing pieces. Direct mail is a great way to make the first touchpoint, followed by email or social media marketing, and followed up again with direct mail to truly drive interest, brand awareness, and familiarity. Make sure your messaging is consistent across all platforms by using data that allows you to tie all of these elements and channels together.
2. Track, Measure, Adjust
The top response rate tracking methods according to the latest DMA report are PURLs (61%), which are personalized URL's that can be added to direct mail pieces to generate higher quality leads. By adding a unique web address as a response channel on a direct mail piece, you enable your customers to follow through the first touch point (your mail piece) to a highly targeted landing page that will capture the effect of your direct mail pieces, and garner constant analytics to understand and improve campaign performance.
Other effective methods for quick and easy tracking include call center numbers, which can be unique to the mail piece based on offer, targeting group, etc. that allow you to track who is calling about your product or service after receiving a mail piece. This allows you to provide a seamless customer service experience, and understand on a personal level what about your offer, product, service, or marketing techniques are driving your prospects to take action and use that in future campaigns.
Codes and coupons are also highly effective and easy ways to track the success of your campaign. Tracking who's redeeming the special coupons you send out will provide you with an understanding of what offers are successful in driving action, and even how the creative may impact redemption rates.
Last, but not least, return to your data-driven cycle by initially pulling a holdout group from the prospects your targeting and use it to compare the response rates between those who have received your marketing mail, and those who did not to discover the correlation between your direct mail marketing and response rates. This is the most effective way to compare marketing results on direct comparison basis, and can help you understand where you're effective, what can be improved, and what your prospect pool's response profiles are.
3. Creative Counts...Designing an Effective Piece
There are a lot of great trends and designs and even just basic layout essentials that will greatly improve your open and response rates. It's always a good idea to do A/B versioning with creative, and not just with offers, variables, and wording, but also with mail piece types. You don't have to go crazy, but if possible, run two campaigns with the same offer, different versions, and track the response rate of each.
- Choose the right format - There's many types direct mail formats, from menus to postcards to brochures to simple letters, and the format dictates the amount of text and images that will fit on your piece The important thing to consider when first choosing a format is to consider what your message is and who your audience is. If you're marketing a complicated product to an introductory audience, you may want to include more detail - in which case, a brochure may be the best choice. If you're looking to run a coupon campaign or make a quick announcement, postcards are probably the way to go. For retailers, a seasonal catalog often has high response rates. In general, the larger the piece, the larger the impact; although it is important to keep in mind that the price point is typically higher for such pieces.
- Make sure you have all the components - A typical mail piece has some key copy elements that appear on every piece, including offers with coupon codes, call to actions, a headline, tracking information (phone number, email, PURL, QR Code, etc.), benefits, and subhead. These seem like obvious elements, but keep the principles in mind to make sure your piece has everything you need to make effective and measurable.
- Use strategic fonts - Design elements are usually best left to experts, but if you're working to effect a quick mail piece without a large team, there are some design basics that are good to know, especially when it comes to the readability of your piece. You want text that's easily scannable, so stick to one or two typefaces to achieve an attention-grabbing, but not messy piece. Sans serif fonts are usually the best option, since they're easier to scan and quickly comprehend. Using different points (weights or sizes) of the same font to keep things visually interesting, while sticking to one or two typefaces.
- Imagery 101 - graphics are often the first component of a mailpiece that grab a reader's attention and increase the likelihood of their reading your mail piece. Images that show people using your product or service to enhance their lives helps prospects understand what the benefit of your company truly is. You'll also want to make sure you're always using high-resolution images (300 dpi or higher). Try to avoid busy backgrounds: a simple image, color or pattern will ensure your prospects aren't distracted. Last but not least, avoid putting text over your images. Again, readability is the most important part of a mail piece's design, so where possible, replace part of the image with a solid color to make the text stand out.
Mail Piece Trends To Know
- Personalization has a significant effect on response rates. Adding a person's name in full color in the direct mail piece can increase response while using more sophisticated data information by 500% compared to pieces that do not utilize any of these tactics (Canon Solutions)
- Oversized envelopes have the greatest household response rates at 6.6% compared to postcards at 5.6% and letter sized envelopes at 4.3%
- Minimalism is garnering high responses right now, with audiences trending towards a return towards simplicity and honesty. Keep images clear, short text and to the point, and maximize white space with a clean and simple layout.
- Check out the color experts Pantone trends. According to their expert color forecasters, blues and oranges are associated with resourcefulness, yellow is playful, and gold is sophisticated. This can be a great guide for knowing what colors are grabbing audience's attention right now.
- Use good data to personalize, build targeted prospect lists, and create predictive response models for higher response rates
- Use direct mail as an important touchpoint in the marketing cycle, but keep your messaging consistent across all channels
- There are tons of tracking methods available, whether it's coupon codes, creative versioning, PURLs, or controlled hold out groups, and you should always measure and adjust continuously
- Work with design experts to create a piece that truly stands out and garners high responses
If you're curious about how to get the best data for your direct mail campaigns, or want more information about audience targeting, segmenting, and measurement, contact one of our data experts today to find out about multi-channel marketing integrations, database management, and custom prospect list builds.