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Creating an Effective Direct Mail Strategy

July 28, 2015

Direct Mail Strategy

While direct mail may no longer be the dominant direct marketing channel, it still remains a power player alongside mobile, search, email, social and many other online options. The name of the game today is “integrated channel” marketing.  

Businesses are now using multiple channels to reach customers, prospects and generate leads.  What’s true for any channel, however, are three simple marketing basics:

-  Do we know our prospect and have the right list? (List)
-  Does the deal or offer we present tempt the prospect to take action? (Offer)
-  Does the marketing copy and design catch attention, set an impression and prompt action? (Creative/Design)

Given this criteria, direct mail continues to have a distinct advantage compared to the other channels.  In this guide, we will provide an indepth look at what still sets direct mail marketing apart and makes it unique.  This guide will also walk you through the fundamentals of creating an effective strategy and the key considerations for measuring results and integrating with the other online channels.

Introduction

A business is only as strong as its marketing strategy and, from this point of view, it is imperative to realize the key components and how they impact your overall return and end product.

Marketing strategies and choices have exploded since the internet became mainstream, with digital marketing channels such as paid search, display marketing, affiliate marketing and SEO taking center stage in lots of modern strategies, particularly for businesses founded in the last 10 years. That said, traditional direct marketing channels still remain a fundamental part of the current marketing mix due to the level of reach, flexibility and integration that they provide.

Direct Mail Strategy Tips

The concept of direct mail is not a new one in the world of marketing but it’s still commonly associated with high rates of return on investment (ROI) and engagement. Direct mail doesn’t come with ultra-modern SaaS platforms and a myriad of software vendors offering convenient integrations, but it does get results. This article from the Online Marketing Institute details why direct mail is still one the most commonly used channels - comparing the ROI and cost per acquisition (CPA) to digital channels, particularly email marketing - which shares a lot of similarities in terms of list building, overall approach and segmentation.

The most crucial element of direct mail is to understand how it impacts users, your brand and other marketing channels - as false attribution is very prevalent around direct marketing in general.

What is direct mail marketing?

Though the prevalence of the internet, and all its marketing capabilities, is impossible to ignore, it is testament to the versatility and successfulness of direct mail marketing that it remains one of the most important elements of a marketing strategy to this day.

The effectiveness of direct mail, particularly in terms of perception, is reflected in research. Research by the Great Britain’s Royal Mail finds that 57% of people said that they felt valued by mail delivered to them, compared to a much lower 17% who said the same about emails. The research also shows 61% of people say mail gives a better impression, compared to 45% saying the same about email. According to a 2012 Epsilon survey, 59% of US residents actually enjoy getting direct mail from brands about their new products and services.

But what exactly is direct mail marketing and how is it used on a day to day basis. This is a good question and one that can’t really be answered in one ‘capture all’ response. Generally speaking, however, direct mail marketing is best explained as a myriad of marketing materials encompassing the likes of postcards, brochures, catalogues and newsletters that companies create and send out in the mail to both existing clients and, of course, potential customers. Unlike general advertising, the best direct mail campaigns focus on relevant and specific offers and statements- that get recipients to “act now”.

Direct Mail Personalization

The fact that direct mail can be personalized and tailored strategically to the recipient to provide a much more direct message that will resonate is something that unquestionably sets it apart from other forms of marketing.

Almost all major companies today understand the notion of a well balanced marketing mix. The savviest realize that it direct mail can act as a “redirect” and push recipients online.  In order to truly achieve business success, they will use all their marketing endeavours collaboratively (both on and offline) to create a cohesive strategy that yields the best possible marketing results.

What are the objectives of direct mail marketing?

Several objectives of direct mail marketing include to increase awareness of one’s brand, showcase products, to get recipients to act now and a whole host of aspects that will be found between all the different forms of marketing out there. There are very few forms of marketing which can exhibit such continued success in achieving quantifiable results than direct mail and it’s not difficult to see why it is one of the first considerations of any company when implementing a marketing strategy.

This isn’t to say, however, that different direct mail campaigns won’t have different objectives and it will depend on your target audience, budget and overall strategy as this will likely dictate what you’re hoping to achieve with any given direct mail marketing campaign. With this in mind, we’ve outlined some of the main objectives that are likely to be the catalyst and driving force behind a brand’s direct mail campaign:

-  As a means of acquisition - Most direct mail campaigns will be formulated with the objective of achieving some form acquisition and it has proven consistently over time that there are few methods that can compare in terms of effectiveness. The different types of acquisition that a direct mail marketing campaign is likely to be concerned with is outlined below:

        Email acquisition - In a large number of cases, a company’s email database won’t be as big as their direct mail database and many companies operating today see direct mail - such as sending a postcard with an incentive for providing an email - as a fantastic means of acquiring a customer’s or potential new customer’s email address which is another means by which they can be marketed to going forward. This is particularly true of long-standing companies that have been investing in direct mail for years and understand the potential pitfalls of email such as Gmail filtering and other barriers that can prevent your message being received.

         Additional data acquisition - It’s not just a customer’s email that is a valuable commodity to brand. There are all sorts of little bits of data that can be gleaned from a direct mail campaign such as birthdays, favoured brands and all manner of personal preferences that will prove invaluable to a brand’s understanding of their customer.

-  As a tool for driving sales - Most companies will see their direct mail campaign as a means of generating either sales or sale leads and it is an extremely effective tool for achieving both in abundance. We’ve all received a branded postcard, catalog or brochure in the mail and been compelled to make a sale decision based upon this whether this be straight away or further down the line with the direct mail having planted the seed. In order for direct mail to be a success in terms of driving sales, you need to think about your target demographics and list strategy but we’ll talk about this later.
-  As a means of providing good customer service - Regardless of how good the algorithms become, there’s no escaping the rather impersonal nature of an email and many customers will prefer something more tangible and real that arrives through their door and which feels like has been made specifically for them - whether it’s a postcard with a birthday offer or a personalized piece of marketing, direct mail really is a cut above the competition in this department and remains a chief catalyst for funneling people online to make a purchase.
-  As a means of engagement - A successful brand knows the importance of engagement with their customers and how this should be done on as many fronts as possible with direct mail marketing undoubtedly forming one of the engagement cornerstones that all brands should be utilizing. Keeping your brand front and center in the mind of customers isn’t something that is always easy in a world of constant marketing bombardment, particularly online, which is why a well-designed, personalized piece of direct mail will really set you apart and keep your customer engaged.
-  As a means of creating brand awareness - Whether it is an established company or one that is just starting out, direct mail remains one of the most crucial avenues for increasing or enhancing the awareness surrounding one’s brand. A direct mail campaign done right will drastically enhance a company’s awareness and can be built upon to drive customers online.

Examples of types of objectives that companies might hope to achieve from direct mail include generating 50 sales or 100 business leads. It can also be measured by how successful the direct mail has been at driving traffic into a store. For example, a store might have an objective of driving 100 extra customers in store via their direct mail campaign.

These are just some of the objectives that are inherent with a direct mail marketing campaign but it always about tailoring the campaign to your requirements which might not fall into those outlined above. What is always important to remember is to make sure that you use high quality direct mail materials, formats and sizing, so that your mail stands out and grabs the reader's attention.

Target audience for direct mail marketing

One of the most pivotal aspects to make sure you get right when it comes to a direct mail marketing campaign is ensuring you do proper research into your target demographics and think smart about how you market to them directly.

But who should you target with your direct mail marketing and how should you go about it to ensure its successfulness? We’ve outlined some of the key things to remember so far as demographics and direct mail are concerned below:

-  Do your research - It pays (literally in most cases) to do your research before you start a new direct mail marketing campaign because if you get your target audience right, you will likely yield the dividends and achieve the results you expect from your campaign. Most businesses have a pretty good handle on who their target customer is from their buyer history and the type of product that they sell. If your product achieves the best results amongst males aged 18-34 then that is who you should be looking to target with your direct mail outreach.
-  Finding new leads - Direct mail isn’t just a question of marketing to your current customers and is, as mentioned, a great means of acquiring new ones. Once you understand who your customer is you can then target the ones that are ideally suited to your business. Gone are the days when companies just send out as much marketing material in the mail as possible with the ethos of ‘if enough people see it, some will respond’ as it’s now much easier to hone in on customers who you know will likely be engaged by your direct mail offerings.
-  Think about samples - When sending out direct mail letters, postcards and brochures, many brands for whom it is viable will consider including samples of their products. This is one of the direct mail marketing strategies that almost guarantees engagement and opening from the recipient. If they see that there is a free sample included, it will be intriguing and if they like the product in question, chances are you will convert them into an ongoing customer. The 18-34 demographic are likely to be most engaged by this form of direct mail strategy as they see its value and can then follow through with more online action and engagement.

The target audience for any given brand with their direct mail strategy will largely be dictated by their existing audience.   This knowledge will create a compelling direct mail campaign that hits the right audience at the right time to deliver results.

Segmentation

Direct Mail Marketing Segmentation

With direct mail marketing, the process of segmentation is somewhat of an art form and can, in many ways, make or break the success of your campaign. In the past most companies adopted a ‘one-size’ fits all direct mail mindset insomuch as they didn’t tailor their mailers to the recipient and merely sent the same piece of marketing literature to all their customers and this, of course, had serious limitations.

That’s where segmentation comes into play and in order to enhance the chances of success with a direct mail marketing campaign, you need to put serious consideration into how your segment your database. For most businesses, there are a number of core ways in which your customers can be segmented and we’ve outlined these below:

-  Spending Patterns - Most companies will have access to the sales data of their customers and this allows them to spot patterns and make comparisons-which is crucial to successful direct mail campaign. By acknowledging spending patterns you can make sure that you send your direct mail at a time to coincide with these patterns i.e. pay day, birthday or seasonal patterns.
-  Geolocation - Another area that brands often forget to take into account with their direct mail marketing is geographical location of their recipient and this is why this data needs to be segmented efficiently. For example, there is no point in sending a direct mail piece to somewhere in a location that isn’t relevant to what is being offered in the material.
-  Age - A customer’s age will have a big bearing on how you should market to them and if you’ve properly segmented this data before you send out your direct mail campaign, you can ensure that you make it age appropriate in terms of the language used, font size, imagery and call to action because this will likely need to be different for different age demographics.
-  Gender - Clearly, the gender of the recipient will likely have a bearing on how you choose to market your direct mail postcard or brochure to them and it’s plain to see the pitfalls of just sending one type of marketing literature to both sexes.

The reason it is so important to get your data segmentation right in direct mail marketing is because it will then allow you to ensure you’re not missing out on any cross-selling or up-selling opportunities that would otherwise be missed.

An example of this is seen in sending out targeted marketing to a customer based on what you know about their sales patterns and preferences but not including a means of selling them something similarly aligned to their tastes at the same time. For example, a mailer sent out to males aged 18-36 about soccer cleats that doesn’t reference an ongoing promotion on shin-pads - you get the picture!

Using direct mail as part of your multi-channel strategy

In today’s fast-paced world of advertising whereby new forms of reaching and engaging customers and potential customers are constantly emerging, it is more important than ever to think about your multi-channel strategy which embraces all these different methods and seeing it as a jigsaw of marketing that all fits together to make a campaign successful across the board.

Direct mail is an integral cog the marketing mix as it remains one of the most dynamic forms of advertising one’s company to customers and can be implemented at so many points of a customer journey right from acquisition to retention. Direct mail really does play well alongside other forms of advertising more prevalent in a technological age and any company who wants their sales results to increase year on year needs to ensure that direct mail - such as the sending of targeted brochures, postcards and newsletters - needs to remain part of a robust marketing mix.

In terms of a compelling statistic as to why companies should still use direct mail marketing in a technological age is the Direct Mail Association (DMA) assertion that 65% of consumers of all ages have made a purchase as a result of direct mail marketing. So, if this isn’t part of your current multi-channel marketing strategy then it patently should be!

This article provides lots of data around the impact of integrating email and direct mail, as opposed to using the two independently.

Importance of getting the design and offer right

Once you’ve got your segmentation and list work done, you can then turn your attention to the actual design and offer of the direct mail that you are sending out. Postcards remain amongst the most popular forms of direct mail because, unlike any other mail that is still sent out, postcards have a 100% open rate and quickly grab the attention of the reader.

Direct Mail Marketing Tips for Postcard Design

Spend time on design of your direct mail as it really can have a big impact on the effectiveness of a campaign.  It might make sense to  use the services of a designer to ensure that you’re getting it just right for your target demographics. When it comes to design and offer principles for direct mail, the following are all important factors to bear in mind:

-  Be Personal - Not in a rude way of course! But make sure that you personalize the direct mail that you’re sending out. As you’ve probably realized now, personalization is something that pervades most elements of direct mail and it’s no different so far as the design is concerned. Personalization tips with direct mail include using the recipient’s first name, their statistics within the company such as points accrued and what can be purchased with those points or something relevant-as a postcard with the exact outfit they tried on during a recent store visit and an incentive to purchase. The degree to which you can personalize your direct mail will, of course, depend on how much data you have on your customers.
-  Be Smart About USPS Postal Regulations - This is something that many companies will fail to take into account when designing their direct mail campaigns but it is something that you’ll soon find will ramp up the cost if you’re not careful. Make sure you’re up to date with the allowed dimensions and weights of different kinds of postage and try and keep your material in line with how much you’re looking to spend - this is one of the chief reasons that a lot of brands turn to cost effective postcards for their direct mail activities.
-  Be Eye Catching - When you send direct mail you need to bear in mind that you’ll likely be competing with a half dozen or so other pieces on any given day so you need to ensure that yours stands out with an eye-catching design. Make sure your branding is on point, with a clear message and intelligent design that leads the eye to the relevant places. Again, most companies opt for oversized jumbo postcards with their direct mail strategy because this negates the need for an envelope which is merely another barrier to someone seeing your campaign.
-  Don’t Be Afraid To Test - Very few companies will get the design and offer of their direct mail campaign right straight off the bat and you shouldn’t be afraid to try out different designs and forms of marketing material whilst trying to discover which works best for you and your company. So, for example, if you’re sending out 1000 pieces of direct mail, why not send 250 with a slightly different design, offer or type of personalization- to test what creates a better response rate.
-  Don’t Forget The Call To Action - It can be easy to get so caught up in making design tweaks to your direct mail that you forget to actually include the most important element of all - the call to action. The line that prompts your recipient to make an action should be well positioned within the postcard and suitably compelling to prompt them into action as soon as possible before the impact has surpassed.
-  Be Creative With Your Offers - Craft strong offers that will get recipients to respond.  Besides your list segmentation efforts, the offer is the next most important ingredient to the success of your direct mailer. As a general rule, the more valuable and risk-free the offer seems to the reader, the better the response rates.  Also, the more believable the offer is, the more likely its success.  And don’t forget the word FREE is still the magic word in direct mail marketing.

Good design and offer creation can be difficult. If you don’t have capable in-house talent then you should certainly look to utilize the services of freelance direct marketers, copywriters and/or  designers who know how to create engaging content using a limited canvas space (such as postcard).

Measurement

Executing a direct mail campaign is a relatively easy task, but unless you have put some simple, tactical measures into place first, measuring the campaign results can be difficult. Like many other marketing strategies, direct mail works well if it is part of a multi dimensional campaign, such as emails, phone call follow-up, or online marketing tactics.

Measuring Direct Marketing

If you are unable to measure the results of your direct mail campaigns, you may be throwing money away on ineffective marketing strategies for your business.  A few of the most common ways businesses evaluate the effectiveness of their direct mail campaigns include measuring: 

·       Gross response rates

·       Increased sales rates

·       Cost per lead

·       Cost per acquisition

·       Lifetime value of a new customer

But in today’s cross-channel marketing environment, it can be difficult to determine which channel was most responsible for achieving the desired response. Many marketers struggle with this, and as a result, direct mail doesn’t always get the credit it deserves. There are certain tactics your direct mail piece can employ to help determine if it drove your audience to your intended message.  Direct mail in the past was tricky to measure. However, with technological advancements, tracking direct mail marketing is getting more accurate all the time.

Some of the new forms of measuring and tracking direct mail include:

-  Customized URLs - One of the easiest means of measuring the success rate of a direct mail campaign is to include a call to action that includes a customized URL to that is specific to that piece of marketing material and which can then be tracked using analytic software on the company’s website such as Google Analytics. Ideally, you will create a URL that will ONLY be accessible via the direct mail that you send out and then you can track how many visits to that URL there are and have specific data about the campaign’s success.
-  Promotional Codes / QR Codes - Another great way of measuring the impact of your direct mail campaign is to include promotional codes or QR codes specific to the items you’re sending out. An example of this is having a sale code such as SUMMER20 that is only applicable to your direct mailers and this allows you to track who’s used this code using your point of sale data.
-  Phone Call Tracking - Another fairly easy way of measuring your direct mail strategy is to set up specific phone number(s) that will be listed on the literature that you send out and then monitor how many calls you have to these numbers and keep track of the success of the campaign that way.
-  Looking at the Geographical Data - As outlined in the segmentation section earlier, you should be segmenting your direct mail into geographical regions and, in doing so, you can look for patterns and trends within your sales for each region which coincide with when your direct mail marketing was delivered to customers.

Measuring the success of your direct mail marketing is crucially important and, thanks to technology, it is pretty straightforward. If you deploy some of the measurement tools outlined above you really can provide yourself with an accurate overview of the successes and failures of your direct mail marketing campaign.

Conclusion

To conclude, we’ve outlined the principles of direct mail marketing and aimed to shine a light on why it is still an important piece of the vast majority of marketing campaigns for businesses, both large and small.   By understanding the importance of direct mail and the list, offer and creative criteria- you should now be able to create better, targeted direct mail campaigns that drive sales, increase brand awareness and engage your customers!

Additional reading

http://www.onlinemarketinginstitute.org/blog/2013/06/why-direct-mail-still-yields-the-lowest-cost-per-lead-and-highest-conversion-rate/

http://www.businessinsider.com/the-exploding-importance-of-direct-marketing-2013-11?IR=T

http://www.entrepreneur.com/article/230748