Earlier this week I was talking to a prospective client about ways they could improve direct mail. They’ve been in the jewelry industry for decades and were looking for a way to boost sales heading into the holiday season. He mentioned that they’d used direct mail with varying success over the years, but had been doing it in-house all that time. In an effort to ramp up and really move the needle he reached out to us to help them achieve their sales goals.
This is a pretty common conversation we get. “We use this channel but are looking for ways to improve direct mail to get a better return on our investment.” So today we’re going to highlight some of the current ways client’s using direct mail are maximizing their results.
1. Spend More Time, Much More, on Targeting
Collectively, we’ve worked on thousands of direct mail campaigns over the years. Based upon client campaign analytics, we’ve found that 40% of a direct mail campaign’s success is tied to that upfront effort spent around targeting.
Fundamentally there are two types of campaigns. You’re either trying to re-engage your existing customers with retention-based marketing, or you’re trying to generate new customers through an acquisition campaign.
Regardless of which direction you want to focus your direct mail campaign on you should think about the different ways you can segment those groups. We’re going to get into different ways you can segment both of these groups, but fundamentally, there is one primary benefit you get when segmenting.
As you get more and more specific with your targeting, you can also get more and more specific with your messaging. The more refined your message and offer are to the needs of each segment significantly increases response rates, and ultimately conversions. This isn’t rocket science, and yet many companies half-ass it when it comes to segmenting so we’ve listed several different ways you can make your targeting more effective.
Cold vs. Active Customers:
While active customers may be your bread and butter, cold customers can be a great pool to tap into, but they often need more motivation to come back. Each business is going to be different in what defines being “cold” but once you have that defined you can segment this group and provide them with a stronger offer to come back for repeat sales.
Segmenting your customer base by sales volume is a great way to reveal which groups need more attention. Defining these tiers allows you to focus on improving the customer experience, something guru Nate Brown outlined on a recent podcast.
What is the average number of customer purchases in a year, and how frequently do they come in? Once you have this defined, you can put together campaigns that encourage your “lower” customers to increase their purchasing frequency.
One of the most powerful techniques to define prospect segmentation is to analyze your existing customer base. You’ve likely heard of “look-a-like” segments, which are great, but ResponseLift™ puts that process on steroids. This is our proprietary customer analysis tool that looks at over 1,500 unique attributes of each customer. It then highlights the most common attributes to build a very customized model that can then be applied to your market area. This has been by far the most effective way to improve direct mail targeting when working with our clients.
Define and Refine:
For those that want to improve direct mail efforts, but don’t have time to do a full-blown customer analysis, you can still look internally at what kind of customer profiles you see. From this, you can create demographical profiles of what you think each segment looks like. Once you have those defined you can create A/B testing groups that will allow you to measure the effectiveness of each segment. This can and should be an iterative process that continues to be tested and refined, whether it’s evaluating customer profile demographics, or messaging, offer, etc..
While defining demographics can be an effective way to segment your market, behavioral is another approach that can be more timely. A common way we do this today is to leverage life-stage data. Lifestage data like getting married, moving or having children are great examples of defining moments in someone’s life that often lead to new purchasing behaviors. A good exercise for you is to evaluate your products/services to see how they can be connected to different life stages, and then you’ve got a new, more accurate way to segment your marketplace.
2. Improve Direct Mail by Changing Your Mail Kit
As highlighted in a recent post, there are a lot of ways to improve direct mail options, including changing up your direct mail kit that’s better suited for your industry. I recently talked with a client in the tele-health space and he told me that #10 envelope mailers have worked the best in that space for the past 15 years. He said that every couple of years he tries something new and time and time again.
This is a great example of continually striving for better results. Even though direct mail was working well from a response rate and ROAS standpoint, he still periodically tried different mail kits to see if he could improve performance. Now I’m not surprised because envelope mailers tend to perform better within healthcare campaigns, but it’s still best practice to test performance now and again.
That’s exactly what another client of ours in the retail space did. They’d historically sent catalogs, which seemed to perform well as it allowed ample room to showcase different products. However, recently we’d narrowed the focus of the campaign and executed on a postcard and the results were nearly double of their last campaign.
The point is, people and industries will evolve over time so it’s good to test out your mail kits from time to time to see what’s performing the best in current conditions.
3. Improve Direct Mail by Making it Interactive
People like to be intrigued so if you can turn your direct mail pieces into one that’s interactive it will definitely get noticed more, and will likely lead to better response rates. Historically, a booklet would be a way to make the mail piece interactive, but that’s tired these days.
QR codes flopped when they first came out because of a couple reasons. Originally you needed to have a special app that could read them but now nearly every mobile camera will load the content effortlessly. The other reason QR codes bombed was the user experience was bad or just plain boring. Now that most websites are responsive the user should have a good experience if you do nothing more than send them to your home page. To increase the user experience you really should have a designated landing page that succinctly ties into the mail piece.
Regardless of how you set up the landing page, what’s great about QR codes is that they create an instant bridge from offline physical direct mail and your online efforts. That turns a static mail piece into real-time digital experience that more efficiently pushes your prospects down the funnel.
Want to get really creative with QR codes? You should check out new advancements around augmented reality that can turn the physical space around your mailer into a creative new world. Here’s a clip that exposed me to how surreal it can be.
Another way you can make your mail piece more interactive is by using plastic postcards. These postcards are literally made out of plastic and therefore have a much different feel to them compared to traditional mail. This alone makes them stand out more and can lead to double-digit increases in response rates. However, plastic postcards also allow you to have punchouts. These can be in unique shapes, but most commonly are used for key chain fobs and membership cards.
This creates a very interactive experience and transforms your mailer into a long-term item of value to the recipients. This combination makes for a very powerful direct mail piece. However, USPS years ago stopped letting companies make plastic postcards unless they grandfathered you in, which fortunately includes Propelo Media.
4. Personalize Your Mail Pieces
Personalization is the art of individualizing each recipient’s mailer. Technically this is done on most mailers when the piece is addressed with each recipient’s name. However that’s drab and boring so what we’re talking about today is personalizing your mailing piece within the actual design. When done well this can be as simple as using the recipient’s actual name, but done so with an eye-catching font.
When done really well this can include other unique text fields incorporated throughout the design, or even unique graphics embedded into the design. As an example, I once worked on a campaign for a retail store that was able to generate custom directional maps for each recipient from their door to the store’s location.
The more, relevant, data points you can incorporate into the piece will improve direct mail performance. Each unique data point helps to build a deeper connection with recipients because it shows that you put effort into the direct mail piece instead. It also shows that your company is informed and is trying to uniquely approach the recipient instead of blindly mailing a community in mass.
5. Stay Consistent
Marketing efforts are like dieting. If you only do it for a little bit then you’re only going to get little results. Like all marketing, if you’re going to utilize direct mail you need to do so as a life-style, which requires you being consistent. That’s not to say you can’t try different strategies, mail kits, offers, etc., it just means that you need to maintain a consistent presence in your market.
I had the pleasure of working with Kristan Cole, one of the nation’s top Realtors®, for several years. Her marketing rarely changed, and most of the pieces she sent out were on the smallest postcard allowed. However, she would send out tens of thousands of postcards each month to different markets in her area. I’ll never forget when she told me that consistency is one of the most important aspects of her direct mail strategy.
How frequently you need to be consistent will be different for every product and service. Remember though, out of sight is out of mind, so just focus on what works best for you.
6. Focus on Benefits, Not Attributes
Too many businesses focus on what they sell and not the benefits people get from that purchase. Generally speaking this is a lazy approach that, if lucky, will get yawns but will more likely result in your mail piece being tossed in the trash. It’s not that you shouldn’t include some attributes, but these should be supporting points vs. selling points.
Let’s take automobiles for a moment. You could tell people that your vehicle gets 45mpg, or you could tell people that your vehicle is fuel efficient and will significantly save them at the pump. Depending on your targeting you might also tell them that this vehicle is more environmentally friendly. It was this approach that Kia took several years ago during the Super Bowl commercial that ultimately led me to buy a Niro.
People are more easily swayed by emotion, and focusing on benefits allows people to literally imagine how those benefits could impact their life. This improves direct mail by making it more memorable to each recipient, leading to higher conversion rates.
7. Define Your Tracking KPIs Upfront
There’s an old marketing adage that says, “I know 50% of my marketing is working, I just don’t know which 50%.” I personally heard this nearly 15 years ago at a conference, and at the moment I appreciated the uncomfortable accuracy of that statement. However, at the time digital marketing was already transcending the ability to track and monitor campaigns, which made this quote seem less and less accurate.
In a digital world attribution can be tracked so much easier than direct mail. That’s not to say you don’t have options though. Unique promo codes, barcodes, phone numbers, landing pages, and QR codes are all ways you can ensure for better campaign tracking, but you have to make sure that the KPI you use is unique and limited to each specific campaign otherwise you’ll be scratching your head trying to figure out which 50% worked.
Another method that we utilize in-house is called match-back analysis. With this method we will work with our clients to get all response and conversion data acquired during the campaign. We then cross reference that data against the original targeting file to get a clear picture of which responses and conversions were directly tied to the direct mail campaign.
How You Can Get Started
Interested in trying direct mail for the first time and don’t know where to start, or perhaps you’re simply looking to improve direct mail performance? We have over 20 years of experience and would be happy to learn more about your company and objectives so we can give you a candid assessment of how you could start use direct mail to your benefit.