29 Nov How to Get Remarkable Direct Mail Response Rates [Quick Guide Inside]
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Businesses are dropping their email marketing campaigns for better results with direct mail. Online marketing is all the rage these days but direct mail marketing is still going strong, and in some ways, is more efficient. If you want consistent and good response rates from your direct mail campaigns, then you need a proper, strategic plan.
Direct mail is a marketing strategy comparable in ROI to other modes of marketing like advertising and digital marketing. Though the reach with ads and digital platforms may be wider, the cost per response levels the playing field. As the United States Postal Service reports, this figure has always turned up higher for direct mail.
The challenges to direct mail marketing
Direct mailing has been lauded as effective in limited vertical markets. The argument is consumers view mail, outside of personal correspondence and bills, as junk. Clearly you want to find ways of making sure your mail is well received and responded to by as many people as possible. It’s just many business owners don’t make that effort. So they get what they give.
Your direct mail campaign is likely to succeed if its message and target market align. The language used, the solution you offer (is it in demand?) and the economy are all big influences on lead generation and sales figures.
Here’s how to plan, execute and get a high number of responses from the people in your direct mail program:
Write down your goals
What is it you want to achieve? What target do you want to hit? Is it a sales figure or a customer number? Do you want to widen your customer base? The point of marketing is to generate more revenue, but you must detail from where the revenue will come.
Do you need to sell a new product or offload an old one? Are you trying to create awareness for a cause? Or are you encouraging people to sign up for a newsletter or rewards program?
Regardless of what you choose, bringing your ideas straight to the customer in hard paper has its charm. It feels tangible to them because it’s in their hand.
Take a holiday promotion for example. Admittedly, many of us wait till the last minute to take advantage of travel packages that are marketed in many channels. But how about sending out catalogs earlier in the year so the brochure stays with your potential customers all year around?
The ultimate thing to know when defining goals is that you should provide people a solution to their problems within each mailer. In the case of a holiday, you would be solving the headache of late bookings for flights and accommodations.
Plan your campaign
Get in-depth information about your target market that can set you apart in marketing. What makes them tick, how quickly does their taste change, and what are they craving next? Watch the news and keep track on social media. Beyond these easy means of finding information, a survey is also a powerful tool for getting the exact data you need to construct a robust campaign.
Clarify who is in your market (this can be broad) and segment them for targeted mailers. Factors for categorization include age, location, and socioeconomic status. Come up with an angle for each mailer that fits each particular group.
Remember, marketing is about delivering a message that resonates with its intended audience. It’s not about your product or service, it’s about them. Avoid the mistake of watering down your messaging and brand to appeal to everyone.
Choose the media carefully
Does a postcard work better than a letter? If your message is brief, it would. Use it to promote an event or create awareness for your website and other products. Would a flyer be less costly to print but work as well as a catalog?
Catalogs, as the DMA reports have the lowest median response rates of 0.8% when sent out to prospects. But when sent out to a house list (opted in recipients and customers), they have the highest median response rate of 13.8%.
Letters have the highest response rate conventionally, per the USPS. They are easier to personalize than other forms of direct mail. It’s the best option when you must make some fast decisions.
Per the USPS, 52% of people read postcards. Obviously, the readership is high because all data is available at a glance on both sides of the card. Postcards are easy to generate and cheap to print.
If you have a bundle of products or services to sell, a catalog is worth considering. You can provide in-depth information on virtually all your products as a business. Catalogs however, translate to higher printing costs, so first find the ROI in it.
Packaging demands which mail piece gets read first. A thick envelope of non-standard size would be hard to ignore without checking its contents first. Boxes are the most enticing to open. Superior packaging and a little design may seem an afterthought, but it goes a long way in getting the response you want.
Know what response to expect
A good response rate will vary by business and their marketing and sales goals. The average rate is about 2% for most marketers, but even a 1% rate is acceptable and realistic. When possible, use your company’s historical direct mail response rate as a benchmark.
The size of the response rate depends on several factors. One of them is the quality of the mailing list. The other is the target market. If you’re sending mail to previous responders, you should expect a response rate that is higher than 2% because of the recipients’ previous exposure to your product. If you’re working on a purchased list, then figures between 1% and 3% can be expected.
In 2015, the Direct Mail Association reported the response rate of 3.7% for direct mail. These rates are boosted even further when integrating digital marketing and direct mail.
Estimate your direct mail marketing ROI
With your goals in mind, you can roughly calculate the potential ROI on a campaign. Estimated ROI helps you decide if it’s worth doing at all.
The factors to consider are the number of recipients, cost of the mailer, and cost of postage. Use a conservative rate for responses or these industry figures:
For house lists, the lowest cost per response seen with postcards was $14. Dimensional mail had the highest cost per response at $30. Conversely, and quite interestingly, dimensional mail yielded the lowest cost per response at $43 when sent to prospect lists. Oversized mail took the lead with $105 per yield.
Calculate ROI by dividing the profit by the campaign cost. Get the profit by subtracting the campaign cost and the service/product cost from the revenue generated. Cost per lead is another good measure to watch. It can help you assess the best activities for your marketing dollars.
Set up your database and mailing list.
The list is the foundation for your campaign and is make-or-break for getting results. To put it simply, the list is your market. Creating the letters, brochures, catalogs and such other material is comparatively easy to do when the list is in place.
Your list database should use separate fields for each piece of data. Decide if you want to use prefixes, titles, and preferred salutation (nick-name). Also, decide how to handle abbreviations and apartment numbers. Inconsistencies will create duplicates that even deduping software won’t catch. That turns into unnecessary expense.
Too many lines in an address may be too much to execute on an envelope. For example, company, recipient, address, apt #, city-state-zip, and country. That’s six lines! Industrial printing moves left to right, not top to bottom, so there’s only so much space for lettering. If you have more than four lines planned, check with your printer.
Separate the contacts into at least two categories; the customer (often called “house list”) and prospects. The sources of new prospects could be strategic partners, phonebooks, newspapers, public records where you can, and even court records (hey, it makes sense for some businesses). Once complete, the list must be regularly updated, so it’s always ready to go.
You can purchase lists from a vendor if you are short on time to build one. If you do go that route, test it out before you officially launch. A common problem is overly ambitious marketers blindly sending out mailers without first surveying the list to ensure its accuracy.
Demographic and life style targeted lists are the most successful. For example, if you own a real estate company, and you work well with distressed properties, you target inheritors, people at risk of having their property foreclosed, tax evaders, etc.
It can take time to create a database, but once it is up and running, generating mailers and newsletters in the future will no longer be a headache.
Before any large mailing, run the list through a Nation Change of Address program to ensure accurate delivery to your recipients. This simple step will save you delivery money that you would otherwise have to spend on rectifying deliveries to wrong addresses.
Prepare the content
Highlight key phrases and words, or CAPITALIZE them to draw attention. Make the length of the text brief and use white space so that with every glance a prospect quickly comprehends what they are reading.
Use short, catchy headlines and brief persuasive text to follow. Apply an active tone of voice that is personal and conversational. Select various forms of formatting to break up the monotony of text. The general layout should be easy to the eyes. The art of copywriting can never be underestimated, in terms of getting a response.
If you ask recipients to visit a web page or make a call, set up a tracking mechanism to measure performance. Customize the tracking to report on key marketing criteria such as date of the mailer, the type of mailer, the type of recipient, and so on.
Design the mailer.
The number of applications for direct mail marketing is almost countless. Given this, it’s a good idea to customize one so it becomes something like a trademark. Whenever your prospect sees the mail piece, they automatically know it’s your company. It builds brand continuity which makes your company “stick” in the minds of your recipients.
Customizing should extend to the target market. If you’re selling a product to senior citizens, it would be disastrous to use a yellow theme or font, or yellow paper, because many of them have a problem reading yellow.
A younger demographic, however, might be drawn to such brilliant color. Leverage the psychological impacts of colors to work in your favor. Incorporate it into the graphic design for the card or letter.
The more personable or entertaining a mailer appears, the less likely it will be thrown out unread. Your first goal is to get their attention before it’s discarded. Tricking recipients with “official” looking letters that are sales tactics can be a bait-and-switch. Keep in mind how you want your brand perceived in these cases.
Next you want the recipient to open the letter. Take advantage of the real estate on both sides of the envelope to do this. Provide a legitimate and enticing reason they should, at least, peek inside. “Open” rates matter in direct mail too.
Last, provide a compelling message and clear call to action. Use imagery both inside and outside the mailer that will persuade the potential buyer to take the next, natural step. Remember, we purchase based on emotions and justify it with logic, not vice versa.
Do the proofing
The proofing stage is when you review a draft that resembles the final mailers just before mass production. At this stage, it is CRITICAL to double check web links, phone numbers, catch typos, or even see what’s missing before signing off as approved. Get more than one pair of eyes on it. We’ve seen mailers go out without phone numbers, and that doesn’t have to happen, ever.
Testing and tracking
If you are planning a considerably large campaign, or an on-going program (multiple pieces over time), incorporate in your planning a testing process. Testing will help you narrow down the best options for your mailer(s), and the best results turned into specifications for all your direct marketing activities.
A standard testing approach is to send out different types of mail to different kinds of people and track the progress. Once you find which media elicit the best responses, roll it out to your full database.
Start-up companies can benefit from testing because it helps them strengthen their business model with valuable customer data. Plus it uses the same pool of cash to gain more than just a response to sales. Other traditional forms of marketing have too broad a reach or require more commitment to establish.
For on-going campaigns, plan to mail often, but at spaced intervals so the recipients don’t get annoyed and ask you to strike their name off your list. If they buy what you’re selling, you could hold off on sending them mail and use those resources for prospecting elsewhere.
Remember you are presenting a solution to a real need, so if you relate to the right prospects, don’t give up on sending.
With the “Quick Guide: Planning and Executing a Direct Mail Campaign”, a good direct mail printer, list building tools, and different response channels, you have a solid launching pad. Add to that equation a plan for follow-through to responses, and you’ll close more business. Remember, marketing brings them to your door, but it’s your team at the point of sale.
What’s your direct mail success rate? Send us a comment to share with our subscribers.