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Does Direct Mail Still Work?

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Since the growth of the inbound marketing methodology (thanks, HubSpot!), many companies are leaving traditional outbound marketing behind. They’re swapping cold-calling and spamming out for blogs and downloadable freebies. They’re creating lead nurturing email series instead of billboard ads. They’re actually segmenting their incoming leads.

All of this sounds pretty dang great, both from the perspective of a business owner and from a customer. No one likes flashy, salesy, in-your-face marketing, but content intentionally created to be beneficial to your customers? That’s something we can get behind. .

Recently, however, a client invested in a traditional marketing strategy often dumped in the outbound marketing bucket: direct mail. Direct mail involves sending recipients postcards in the mail, hoping they’ll read the messaging before they dump it into the trash bin. It’s a classic strategy that banks, credit card companies, and local boutiques have used for decades to spread the word about their services. So what’s the problem?

While the postcard itself isn’t necessarily outbound, most direct mail strategies require purchasing a mailing list of potential customers. Not only does this cost money, but it also goes against the principles of inbound marketing. Your customers should reach out to you, not the other way around. 

So here’s the real question: does direct marketing still work in today’s inbound-driven world? Or are you better investing the money into a new blog series or infographic?

Before you decide either way, here are a few things you should keep in mind...

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1. Cost vs. Reward

Mailing lists can cost anywhere from $20-$75 per thousand records, depending on the quality of the records. That doesn’t include the cost of each piece of mail, which may be anywhere from 20¢ to $1 based on the quality of the paper and the color of the ink.

What’s more, you’ll have to spend money designing the piece professionally (please, please, please don’t design it yourself if you’re not a professional graphic designer), which can cost hundreds of dollars.

So what’s the return on that cost? On average, the direct mail response rate in 2018 was around 4.9% for purchased lists. And that’s the highest its been since 2003. It might seem shabby, but this number is higher than the results you might get from other marketing media like cold email, social media ads, and paid search. 

But here’s the problem: tracking the results. Unless a customer explicitly tells you that they came to you because of a direct mailer, you can’t know for sure how you got them. On the other hand, with email marketing, you have built-in data that tells you if you got a customer through a social media ad campaign, a search ad, or through email.

Keep this in mind when direct mail companies promise huge ROIs. They may be talking out of their butts because it’s incredibly difficult to accurately calculate the ROI on direct mail marketing.

2. Do You Want Sales Or Leads?

When you buy a list from a direct mail marketing company, they’ll often talk about how many prospects you’ll reach with their list and how many leads those prospects will turn into. They’ll say things like, “If you grab their attention, you can expect more than 5% of this list to respond to you.”

Okay, great. Even if they could make that promise (which they can’t), responses don’t mean anything unless the leads actually turn into a sale. And, if you don’t have a strong lead nurturing campaign in place, those leads are just going to sit in your CRM for months.

Our advice: do a short beta test with a small, inexpensive list. See how many of the prospects turn into leads, and how many of those leads turn into sales. That way, you can find out whether you’re just throwing money into the dark or making a wise investment.

3. Do You The Emotional Impact Of Direct Mail 

It’s 1995. You’re blasting Coolio’s “Gangsta’s Paradise” from your handheld CD player, and you’re about to hop in your Crown Vic to cruise down to the movie theatre for an evening showing of the new hit movie Toy Story.

But before you leave, you walk to the end of your driveway to take a peek in the mailbox. Sigh. Nothing but bills, more bills, and a wedding invitation for that guy from work you don’t like.

Then you walk inside, hop on the giant PC in your home office, and check your electronic mail. To your amazement, you have two emails. You can barely believe your luck! Somebody actually found your email address on the internet and sent you a message? It’s incredible!

Fast forward two decades and the scene has reversed.

We feel annoyance, or even dread, when we see new emails. But if we get a personalized letter in our “snail mail” mailbox? All the sudden, we feel happier than a kid on his way to the new Toy Story movie.

This isn’t just a chance phenomenon. It’s science. Studies have shown we get a little hit of dopamine when we see personalized direct mail. It’s similar to the feeling we get when our Amazon package arrives, and it’s something you can use to your advantage. 

We know from experience that people buy because of feelings, not logic. If your content can create an emotional connection with your customers, you’re much more likely to get a sale. 

This is likely the biggest reason why direct mail out-performs other types of advertising. If done correctly, direct mail can resonate with customers on a deeper level, but…

4. Need Make It Personalized or Forget It 

There’s nothing worse than finding your mailbox stuffed with $5 pizza coupons and oil change discounts. And, more often than not, that’s exactly what we find. Maybe that’s why 70% of people “hardly ever even look at their junk mail.”

Don’t be responsible for junk mail. Create something customers want to read, something that sets you apart from the sea of spam.

One easy way to separate your direct mail is to use standalone mail. Standalone direct mail refers to pieces of mail you send to prospects without any branding or messaging from another company, such as a postcard or holiday mailer that is from only your company. Shared mail refers to flyers like Valpak and Red Plum, where you share marketing space with other companies.

As far as pros and cons go, shared mail has the bonus of being low cost and providing a broad reach, whereas standalone mail provides an opportunity for one-on-one communication with your prospect, which can lead to higher response rates.

However, both types of mailers suffer from the flaw of being direct mail sent to a purchased mailing list. This is the equivalent of “spray and pray” marketing: you’re just sending stuff out into the world and praying something hits.

Instead, be more precise and personal.

Use your customer relationship management (CRM) system to keep track of your clients’ birthdays, important dates in their lives, or important holidays. Then send them personalized postcards with their address handwritten on the front and a message handwritten on the inside.

That’s a much more effective “direct mailer” than a list of addresses you purchase online, and it helps build lasting relationships with potential customers.

So...Should You Do It?

Back to our direct mail-loving client. He was dead-set on the idea that direct mail would boost traffic to his site better than any inbound marketing strategy. The man was ready to stake his next year’s mortgage payments on a shot-in-the-dark mailer list he found online. It took a lot of work to convince him otherwise.

He said, “But the direct mail company said its response rates are through the roof compared to other forms of marketing. It grabs their attention and it gives my prospects something tangible to hold onto, rather than some digital email.”

“That’s all true,” we told him. “So how about this: why don't you mail all of your prospects glitter bombs? Those are tangible, and it's sure to get their attention.”

Okay, we didn’t really say that. Instead, we gave him the same advice we’re about to give you:

If you want to use direct mail as an element of your overall marketing plan, so be it. Just make sure you know what you're getting yourself into. It’s difficult to track the ROI of direct mail. And even if you do find success after a direct mail campaign, you won’t necessarily know that’s the reason why.

Instead of buying prospect lists online, spend your time and money making personalized standalone pieces like postcards to send to directly to prospects and clients you already have. Include beneficial content your customers will actually enjoy reading. Don’t make it all about you.

Outside of that, put your time and money into easier-to-track marketing, such as search ads, social media campaigns, and email marketing. The numbers might not seem as impressive, but at least you’ll be able to measure their effectiveness. 

Create an Inbound Marketing Strategy that Provides an ROI

Marketing can be overwhelming. Don’t do it alone. 

Our team of inbound certified experts can help your business build a sales-driven system using the fundamentals of the inbound methodology and storytelling marketing. That way, you can get the most out of all your marketing strategies, including direct mail.

If you want help with your modern marketing efforts, sign up for a free strategy session here:

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