As a career direct marketer, I’ve spent the last 20 years in an almost nonstop episode of my own private reality show, “Test and Learn.” Back in the day I tested hotline after hotline – it was the holy grail for reaching people who were direct mail responders. I also used radio, TV, and outbound telemarketing as ways to target prospects. With the rise of digital came many new methods for customer acquisition, and I tried them all. And obviously I did mix and match too – testing different sequences and channel mixes to try and pinpoint the golden goose that would lay the most productive prospect eggs.
Sitting here today after all the CPAs and ROIs have been calculated, I still believe that Direct Mail can rule the day. What’s uniquely powerful about direct mail is not only that it continues to drive large scale acquisition when used on its own. It’s that it also adds incrementality to every other channel that accompanies it as part of an omni-channel campaign mix.
What makes direct mail so powerful? I will share some of my theories in a moment, but first I think it’s also worth mentioning that millennials apparently tend to agree with my assessment. In fact, according to recent statistics from the Direct Marketing Association, millennials are more likely to engage with marketing messages they receive via direct mail than from any other channel. As you think about adding younger customers and increasing lifetime value, direct mail almost certainly must be part of your campaign mix. Here’s why:
It’s the last truly non-invasive channel
The promise of digital has been increased speed and efficiency with the hundreds of tasks we all perform in a given week. But digital is a push channel; one where users are asked to take actions, in their inbox, through links and buttons and banner ads, some of which “follow” the user as they navigate the web. Direct mail allows the consumer to choose if they want to participate or not – it’s a pull channel, by nature. And it allows the consumer to read and interact when and where they like to.
It’s a brick and mortar channel
As Amazon continues to grow and we conduct more and more of our shopping online, there remains merit to channels that allow for physical interaction between a consumer and a product. And in this case, a consumer and a message. Direct mail comes to your house and allows a truly 1:1 experience where you can hold, feel and see a piece in your hands. That immediately lends a personal feeling to direct mail that email, for instance, can’t compete with. And apparently, consumers like it. A study by Epsilon showed that 77 percent of consumers sort through their physical mail as soon as they get it. Even better, data from the U.S. Postal Service showed that 98 percent of people check their mail daily.
It’s more cost effective than you may realize
Over the last 5 – 7 years cost has become more of a concern for direct mailers as postage and production continue to increase. This has caused many marketers to ask themselves why not just double down on digital – it’s cheaper, and you can reach many more people. And while that’s true on the face of it, when marketers focus solely on digital, their conversion rates and response rates are all substantially lower. In addition, direct mail typically drives higher order value and more incremental sales that you couldn’t have gotten digitally. Let’s do a little math using average response rates, to compare the effectiveness of email and direct mail.
Marketer A does an email campaign to a list of 100,00 names and gets a click through of 15% (15,000) and a 10% open rate (1500). Let’s optimistically say the 4% act on the offer – so now Marketer A has 60 sales. Now let’s say Marketer B ran the same campaign via direct mail – 100,000 pieces mailed, but 20% convert – and Marketer B has 400 sales. That’s literally 6 times the amount acquired.
It puts power back in the hands of the marketer – AND the buyer
Unlike digital, direct mail lends itself to providing multiple calls-to-action, and gives marketers the ability to hone in on the way or ways that prospects prefer to transact. Some consumers like to talk to a call center; others like to go online; and believe it or not, some still prefer to put a check in a return envelope. At the end of the day direct mail offers a win-win in that it lets marketers test into the best transaction method(s) for their prospects, plus it lets the buyer decide how they want to complete the sale.
It plays great with all your other channels
Despite my fervent belief in the power of direct mail, I am definitely not suggesting that any marketer give up on a multi-channel strategy. But it’s my assertion that direct mail should always be the one of your primary channels and work in conjunction with all of your acquisition efforts The Little Book of Bigger Returns found that when direct mail is used as part of an integrated campaign, it boosted ROI by 20%, and helped improve the lift of online campaigns by 62%. Direct mail can help prime the pump for online retail and serve as a physical reminder of a message that your prospect received in another channel.
The Bottom Line: It’s not going away anytime soon
I mentioned millennials earlier – and according to a study done by the USPS, 90% of them pick up their mail at their first opportunity, and they engage with it an average of 9.8 minutes. These numbers are higher than they are for Gen-Xers or Boomers. That means a whole new generation that sees the value of direct mail – and a lot of opportunity to innovate in the channel that continues to win.