Download Targeted Direct Mail Done Right

Small
Business
Marketing’s
SECRET
WEAPON
Targeted
Direct Mail
Done Right
An educational guide with ideas, insights and affordable steps
for anyone seeking to make an impact.
Specialists in Direct
& Digital Marketing
Why Direct Mail?
It Works
It’s interesting that the “Father of Advertising,” David Ogilvy,
made all his new hires work in direct response advertising
for at least a year so they could learn sales techniques
that work. He’s the guy who said those who work in direct
response are the “professionals” and those who work in
general advertising are not because the direct response
guys deliver measured results … ”to the dollar”… and the
generalists don’t really know what they accomplished. He
called direct mail his “secret weapon” and went on to build
one of the world’s largest agencies and become a legend in
the field.
Oh, and he’s also the guy who said “around 99% of all
advertising doesn’t sell much of anything” because it isn’t
properly focused on driving sales.
It’s also interesting that even though Mr. Ogilvy passed away
in 1999, “new age” companies like HubSpot still provide links
to his videos that talk about the power of direct marketing.
Seems they know what current research continues to find:
direct mail works … and direct mail done right works better
than just about any other marketing channel or tactic.
Targeted Direct Mail Done Right
Consider just some of the more recent research findings:
• In general, an investment of $1 in direct marketing ad expenditures is
predicted to return, on average, $12.18 in incremental revenue across all
industries. (June 2012, printinthemix.com)
• Direct Marketing produced $2.05 trillion in sales in 2012 - representing
roughly 8.7% of US GDP.
• Direct mail — yes junk mail via snail mail — still reigns supreme,
offering response rates of 1.1 to 1.4% versus 0.03% for email, 0.04% for
Internet display ads, and 0.22% for paid search. (May 2013, hbr.org)
• Direct mail is the preferred channel for receiving marketing from local
shops (51%) and banks (48%), while email is preferred for events and
competitions (50% each). (October 2013, thedrum.com)
• Spending on direct marketing, which uses consumer data lists,
continues to grow at a healthy 5% clip, accounting for more than
$163 billion last year, or half of the total advertising spending in the
U.S. (October 2012, adweek.com)
• According to a Ritter’s Communication study, 50% of people say
they pay more attention to direct mail than any other media.
(October 2012)
• Direct mail has the highest rate of success in new customer acquisition
at 34% compared to other marketing channels. (marketingcharts.com)
• Targeted direct mail boasts a 4.4% response rate compared to email’s
0.12%. (DMA, 2012)
• 40% of consumers say they have tried a new business after receiving
direct mail and 70% have renewed relationships with businesses they
had previously ceased using. (Mail Print)
The power of direct mail is impossible to deny. But that doesn’t mean
you can drop any old thing in the mail and succeed. Thanks to the
measurability of direct mail, there are time-tested guidelines and
techniques to follow. There are also new norms for tying your mail to
your Internet presence to really up performance. The rest of this guide
will provide some insights we hope you find useful.
1
50%-30%-20%:
The Measured Approach to Direct Mail Success
Because direct mail is so measurable – and has been measured so
long – there are tried-and-true methods and guidelines to follow
for success.
In order of importance, the three essential elements of direct mail are:
50%
TARGET
AUDIENCE
30%
1. The list – 50% of the battle is targeting effectively
OFFER
2. The offer – generally given 30% of the credit for success
3. The clarity and credibility of the creative – given 20% of the
credit when done right
Obviously, it does little good to try and sell croquet mallets to
hockey players. Most direct marketers select audiences based on a
combination of two factors: what they’ve done (behavior) and who
they are (demographics).
Of these two, behavioral characteristics will always be the more
powerful predictor of success. But sometimes behavioral data isn’t
available so you are left to make selections based on the demographic
characteristics of your past customers – age, gender, income or
business type, number of employees, job title and geography. These
can perform well, too, as long as you’ve done the work to evaluate
your customer base with specifics.
2
20%
CREATIVE
Targeted Direct Mail Done Right
The Mailing List:
Contributing 50% to Your Campaign’s Success
When planning your effort, you’ll select from any or
several of three types, ranked here by responsiveness.
SRDS: For List Rentals,
a Great Place To Start
1. House lists. Essentially your own internal database, this list is
comprised of customers and other contacts with whom you have
a prior relationship. You can build your house list with names
you’ve collected from product orders, sales receipts, contest entries,
website registration forms, trade show contacts or simply a “register
here” jar on your sales counter.
The Standard Rate & Data Service
gives you sources, selects, costs
and other information with
which to find lists, evaluate their
potential and refine your strategy
for direct marketing campaigns:
Familiar with you and at least somewhat interested in your goods or
services, people on this list are 5-10 times more likely to respond to
your campaign than those on any other list.
2. Response lists. Available for lease or purchase, people on these
lists have responded to some other offer and may be sweepstakes
entrants, event attendees or mail order buyers. A popular method
of response list compilation is through subscriptions, since
magazines provide an excellent means of targeting individuals in
specific industries (e.g., Modern Tire Dealer) or with distinct areas of
interest (e.g., Better Homes and Gardens).
Prospects on these lists will respond at 3-5 times the rate of those
on compiled lists (described below).
3. Compiled lists. Also offered for sale or lease, the names of
prospects on these lists have been culled from telephone
directories, government records or other sources. These lists are
often subdivided to make segmenting prospects easier. Various
“selects” such as age, marital status, household income and
occupation will enable you to focus on consumers who best meet
your target criteria.
While prospects on compiled lists generally respond to offers at rates
lower than in the first two groups, this type of mailing list can be
particularly useful if you are trying to reach a well-defined segment.
For example, a private high school may find a list of higher-income
parents with teenage children who are living within a specific zip code
a cost-effective solution to reaching potential new students.
• Master resource of 65,000+ lists
available for rent today
• 230 consumer and business
market classifications
Targeted Direct Mail vs.
Blanket Coverage
For all our emphasis on targeted
direct mail, local businesses can
often benefit with Every Door
Direct Mail® from the U.S. Postal
Service®. With it, auto repair
centers, dry cleaners, restaurants
and other neighborhood-focused
marketers can specify delivery to
homes or homes and businesses
on mailing routes selected by
address, city, state, ZIP Code or
up to a five-mile radius around
your location – at postal rates as
low as 17.5 cents apiece.
Every Door Direct Mail® and EDDM®
are registered trademarks of the U.S.
Postal Service.
3
Beyond Names and Addresses:
Collecting Consumer Data to Sharpen Your Appeals
As you build your house list, look for ways to collect additional
information. Why? Consumer data can help you better craft your
appeal, e.g., “Our records indicate you may be due for an oil change.”
What’s more, collecting sales/purchase, demographic and other
information will help you better understand who your best customers
are. And by applying these insights to the compiled list “selects”
described on page 3, you can choose the tactics most likely to find
more prospects just like them.
Business-to-consumer (B2C) marketers should collect the following
consumer data:
• Age
• Hobbies
• Birth date
• Household income (HHI)
• Email address
• Marital status
• Family data (kids, pets, etc.)
• Occupation
• Gender
• Purchase history (first time, what
product or service, how often)
Similarly, B2B or business-to-business marketers can enhance their
understanding of prospects by compiling:
• Communications history
• Date and purchase details
of first inquiry or order
4
• Responsiveness to your
marketing programs
• Frequency and purchase
history by date, dollar amount,
or product
• SIC (Standard Industrial
Classification) or NAICS (North
American Industry Classification
System) code
• Number of employees
• Size of firm/annual sales
• Purchase involvement by
product/service type
• Source of their inquiry or order
Targeted Direct Mail Done Right
The Offer:
Counting for 30% of Your Mailer’s Effectiveness
Make one that readers can’t refuse.
A great offer is one that has high perceived value. This does not
necessarily mean it has a high monetary value (and requires a big
budget) – only that your target thinks it’s valuable. It also must be
simple to obtain (or fulfill), easy to explain and readily understood
by your audience.
This Weekend Only!
In direct mail, the best offers are delivered with a sense of urgency.
You can limit the time ( This weekend only!) or the number of items
available (While supplies last!) to stimulate an immediate response.
Among the most common types of offers are these:
Discount offers
• Buy one, get one free (or at a
discounted price)
• Percentage off
• Dollars off
• Seasonal discount
• Rebate
• Introductory price
Promotions
• Free downloads
• Premium on order
• Free sample
• Premium on payment
• Premium on inquiry
• Sweepstakes or contest
Payment-term offers
• Bill me later
• Installment billing
• Free shipping
• Money-back guarantee
• Free trial
• No-money down
Valuable information (for B2B marketers)
• Best practices white paper
• Research report
• Case study
• Subscription to a newsletter
(print or email)
• Cost calculator
5
The Creative:
Driving 20% of Your Mailer’s Results
Apply these five best practices to improve your efforts.
Over decades of testing and refinement, several practices in direct
marketing copy and design have proven themselves time and again.
Follow these tips to greater success.
Best Practice #1: Copy is more important than art. Why? Direct
marketing is less about creating an impression and more about
selling. So focus your efforts on creating attention-getting and
compelling copy. In direct mail, the role of the illustrations and design
is secondary, and should work to deliver the message clearly.
Best Practice #2: Employ a friendly, me-to-you tone. Write the way
you speak, with sincerity and without formality. Direct mail is not
mass advertising; rather, it is one person talking to another. So as you
compose your message, remember: the most powerful word in direct
marketing copy is “you.”
Best Practice #3: Focus on only one thing: Sell the offer, not the
product or service. Don’t try and sell two ideas at once; keep your
message clear and simple. The golden rule in direct response
copywriting? If you confuse, you lose.
Best Practice #4: Avoid the “hard sell” and don’t over promise.
Instead, be credible. After all, most people won’t respond to someone
they don’t trust. So make sure your direct mail offer is believable …
and your tone warm, confident and personable. Added tip? Include a
testimonial or add a guarantee to reassure your readers.
Best Practice # 5: Communicate the benefits rather than the features.
Explain why the customer should care with a, “What’s in it for you”
approach. You may offer a scientific multi-step lawn feeding service,
but prospects will be most interested in the benefits of a beautiful
yard, achieved with ease while they pursue their own leisure activities.
6
Get personal to get more responses.
Today’s variable data printing lets
you personalize direct mailers with
not only your target’s name and
address but also text, images and
even special offers based on past
purchases or other information.
And that’s a good thing for direct
marketers: Personalized appeals
gain four times as many responses
as same-to-all messages.
NAME. Connect
with customers by
using their name or
company name in
communications.
OFFER. Change the offer
based on past purchases
or other information you
know about the recipient.
<NAME>
%OFF
PERSONALIZED
VISUALS. Vary images
QR CODES & URLS.
based on the prospect ’s
Use personalized
age, gender or interests.
response mechanisms
for intrigue and continuity.
Targeted Direct Mail Done Right
Beyond the Basics: Average Number of Media Types
Used in a Direct Mail Campaign
Increase conversions by personalizing a URL.
A personalized URL (PURL) is a unique Web address that directs mail
recipients to a landing page designed specifically for them. For example,
your letter to John R. Doe might refer him to a PURL that greets him by
name and tailors a message especially to him. Special offers, text and
images can be varied for each recipient based on what you know about
them, including interests and purchase history.
Don’t
know
Five or
more
7.6%
One
8.8%
3.7%
Two
30.2%
Four
13.4%
The goal of your PURL is to provide each customer with more complete
and relevant information, while excluding content which is not relevant
to their needs. With a personalized landing page, you can also:
• Increase response and
conversion rates
• Capture additional
prospect information
• Track and measure
responses readily
• Drive cross-channel integration
Three
36.4%
Boost response rates with QR Codes.
QR (Quick Response) codes are machine-readable arrays of black-and­
white squares, typically used for storing website addresses, URLs or other
information for scanning by smartphone cameras. Print one on your
mailer and you’ll give readers a quick way to reach your URL or website
home page. Better yet, use a QR code to link recipients to a landing page
specifically tied to your mailer’s offer, such as one describing your limitedtime discount. Video content is also very powerful.
Ignore smartphone users at your own peril! According to Statistica, the
number of U.S. smartphone users will grow from approximately 160
million in 2014 to more than 193 million by 2016. And among them,
QR codes are popular; 47% of people have used their mobile device
to scan one.
Show prospects the way with variable maps.
Described briefly on page 6, variable data printing also enables direct
marketers to individualize pieces with maps relating to the location of
the recipient. So if your goal is to have John Q. Public visit your nearest
outlet or attend a nearby special event, a variable map can guide the
way. They’re also used by manufacturers to direct potential buyers to
local-area retailers that carry a specific product.
Key
• Average number media types
used in a campaign: 3
• 47% of printed marketing
materials linked to online digital
channels in past 12 months
Optimize results with
online options.
Offer your targets the choice of
responding online to a general
campaign website landing page
or, better yet, a personalized
URL or PURL. Your audience
will appreciate the convenience;
42% of mail recipients prefer
to respond to offers online.
Boost responses with a cross-channel approach.
Don’t limit your lead-generation efforts to a single medium. Those
employing two, three or more types in a cross-channel marketing effort
can improve response rates by as much as 35%, reports InfoTrends.
7
Beyond the Basics: Measure and monitor to make it better.
Tracking Mechanisms
One big advantage to direct mail over most other media is that it’s
possible to track results, assess your campaigns and fine-tune your
efforts for greater achievements going forward.
To measure the effectiveness of a
campaign, you can track how many
direct mail recipients have:
Amazingly, many marketers forego this useful tool. According to
research from the Kellogg School of Management at Northwestern
University, 57% of marketers don’t use a centralized database to
track campaigns. Even worse, 82% fail to monitor their efforts with
readily available automated software, such as marketing resource
management (MRM).
• Accessed a unique campaign URL
or personalized URL (PURL)
To know if your campaigns are profitable and if you are wisely
investing marketing dollars, you need to establish a process for
tracking results.
Begin by determining your direct mail campaign objectives. Do you
want to drive traffic to your store or website? Increase sales? Generate
leads? Boost attendance at a tradeshow? Once you understand your
goals, you can incorporate tracking mechanisms to measure response.
Tip: Put your plan in place before you launch your campaign. In doing
so, you will ensure all results are properly tracked and can be easily
accessed and integrated into your reporting and drive improvements.
What to Measure?
Many direct marketers commonly monitor factors including:
Response rates: How many mail recipients took action (e.g., ordered,
registered, enrolled) as the result of your direct marketing campaign?
Conversion rates: Did sales increase as a result of direct mail effort?
And, if so, was one call-to-action/response method – 800 number,
website, business reply card – more effective than others at
facilitating replies?
Behavior: Perhaps your objective was affecting consumer activity
other than a purchase. Did you seek, for example, to steer recipients
to a website instead of a customer service call center? And, if yes,
what kind of cost savings did you achieve?
Data capture: Were you able to obtain updated or additional
information from prospects and customers that will help you with
future marketing efforts?
8
• Mailed back a reply card or
response envelope with a
tracking code
• Mentioned a promotional code
when responding online or
by phone
• Called a special toll-free number
you’ve set up for specific mailings
• Contacted an email address
created for the campaign
• Redeemed a specially printed
coupon or gift card?
• Registered online or responded
to a free download offer
Targeted Direct Mail Done Right
Just Getting Started? Focused Elsewhere?
Or Seeking Results Right Away?
Truth be told, almost any marketer can achieve success with direct
mail. But not every manager has the time, resources or the luxury
of a learning curve. And that’s where CORE comes in.
CORE is focused on two strategies that deliver now, beginning with
digital marketing. Why? Because in today’s world your first need is a
bulletproof web presence – a solid “be-where-they-go” strategy when
prospects look online for your goods or services.
To reach farther and succeed faster, you also need a pro-active, “go­
where-they-are” strategy in pursuit of your most promising prospects.
And that leads to the second CORE certainty: Direct marketing. Here’s
how we can help …
At CORE Marketing Central, we employ top pros in direct response
copywriting and design. Our mail experts have access to all the best
lists and know all the tricks to keep costs down and deliverability
high. And you’ll work with one experienced, responsive and
reliable resource.
Meanwhile, you’ll forego the hassles of getting a postal permit, buying
or leasing a list, and learning often-changing post office regulations.
Specialists in Direct
& Digital Marketing
9
Small Business Marketing’s SECRET WEAPON
Making Every Marketing Dollar Count
in a Direct and Measurable Way
Keeping up with what works – and what doesn’t – in today’s complex
marketplace requires advisors with decades of experience and a small
army of specialists in traditional and new marketing channels.
But who can afford to hire a marketing services firm with all those
resources and talent?
At long last, you can.
Welcome to CORE. All of our services are executed on a pay-as-you­
go basis by CORE Marketing Central – our award-winning team of
planners, writers, designers, web specialists and direct marketing
experts. Neither of us pays for this resource until we use it. And pricing
is well below that of even small marketing agencies.
The CORE result? Professional, effective and cost-efficient essential
marketing services for companies and organizations with modest
resources.
To get started today with direct mail or any other marketing initiative
large or small, give us a call.
CORE Communications - Novi
Specialists in Direct and Digital Marketing
248-231-1960
www.corecommunications.net/novi