Why Direct Mail?
Have you ever asked your self this question when it comes to where to invest your marketing budget? Based on my 15+ years using DM with a variety of different companies and industries and over the past two years working with hundreds of clients across Canada and the US the simple answer to the question is … it works.
Why then do I get asked the question from time to time? Here’s a quote from my previous VP that might help explain: “Direct Mail has an image issue. Everyone knows it works, but fewer marketers care anymore. They exhibit ‘mail’ Chauvinism”
Direct mail is not sexy to some marketers – it’s not the shiny new kid on the block. Let me talk to just two points that if you’re a DM doubting Thomas, should give you pause to reconsider.
1. Response Rates
The Direct Marketing Association (DMA) in the US reported the average response rate was 4.4% in 2011/2012.
And for Canadians and those marketing to Canada, the news here is even better. Past research found that response rates were higher in Canada than in the US – 25% to 40% higher (mailbox in Canada is less cluttered so better response rates).
Is a 4% response rate good? If you are new to direct mail, you might look at that figure and say that’s low! Do you know what your response rate is for your TV? …print …your website…email…social media? Most you can’t measure and if you can, DM comes out looking very good. 4% is a good number for many businesses and frankly it’s more important to compare these channels from an ROI perspective. If you are selling cars or credit cards you can have low response rates and still make money off your mailing because your lifetime value is large. If you are a pizza shop or a burger joint you need higher response rates to make a buck. Automotive and credit card companies are as longstanding users of dm and I see double digit response rates repeatedly for fast food clients.
2. Preference Research
Which channels do customers prefer companies use to contact them? You might think that is a bit of a misnomer in itself but here what we (Canada Post) heard in 2010:
- Mail is preferred over email, telephone and other means of communications for general / advertising correspondence (79%)
- 93% are reading their mail as soon as they receive it
- 72% look forward to what’s in the mailbox (even I was surprised by this one)
- 63% say receiving mail is a pleasure
So preference is a big thing. Makes sense when you think about advertising this way: traditional broadcast media is push – TV, radio and print interrupt the consumption of the media. Online is pull – something consumers search for on their own. Direct mail fits nicely in the middle. It’s neither pure push nor pull communications. Your customers get their communications when they pick it up amongst their bills and other letter mail. They decide whether or not to read it and when.
Further when we looked at the data by age group, as you would expect the older you are the more likely to want to receive communications through direct mail, but even those aged 18-24 reported appreciating direct mail.
So maybe I’ve convinced you that response rates are good with direct mail. And that consumers told you it’s the preferred channel to receive advertising, it still costs too much right? Again even though I now work for the post office, when I was a client, I wasn’t frivolous with my marketing budget. I allocated the best I could based on ROI. It may cost more than email or social but as marketers we aren’t paid to reduce cost or maximize impressions – we’re paid to maximize ROI.
So next time you are in a planning meeting and you are talking about where to place your advertising $ don’t dismiss direct mail without digging a little deeper. You may be surprised by just how good a tool it can be for your business to drive more people in the door.