With advertising moving largely digital these days, it may be logical to ask, is direct mail marketing still effective? Direct mail, one of the oldest forms of modern advertising, can be traced back to the 19th century. It is still utilized today. According to Forbes, direct mail is a $44 billion per year industry. It’s such a constant part of everyday life that we don’t even think about it anymore. When we go get the mail, there’s a catalog from store A and a postcard from store B. This is why it has remained successful for so long: integration.
While it is considered still a successful marketing tool, that doesn’t mean it is necessarily favored. Below, we will discuss what direct marketing actually is and if it still works. We will also discuss ways to modernize this classic form of advertising.
What Is Direct Mail Marketing?
Direct mail marketing is a type of marketing strategy where advertorial or promotional mail is sent to consumers from businesses. This type of marketing strategy can also be done business to business (B2B) as well as business to consumer (B2C). Despite being overshadowed by the digital age, 73% of American consumers still say they prefer being contacted by brands via direct mail because they can read it whenever they want.
Direct mail marketing has evolved since its early days. With its many forms, can be an effective marketing tool. It continues to see more returns on investment than email marketing. It can also be customized with the target audience in mind.
Types of Direct Mail Marketing
There are various types of direct mail marketing, but most commonly the four popular types of direct mail marketing include: letters, postcards, catalogs, and dimensions. The usage of any form of direct mail marketing will vary depending on the strategic marketing goal of the business or brand. For instance, if your business is promoting a one time only sale on a mattress, creating a catalog would be too costly. Your business would benefit from a postcard with a big headline, detailed fine print, and a call to action.
Direct Mail: Letters and Envelope
This form of direct mail is the most cost-effective and is a great way for small businesses to spread awareness of sales promotions, store updates, or personalized consumer advertisements. While this sector of direct marketing is the least expensive, it also is the least effective yielding only a 3.5% response rate with consumers.
Direct Mail: Postcard
Likewise with letter and envelope direct mail, postcard direct mail marketing is also a cost-effective way to promote a business, but it yields a significantly higher return with 4.25%. It’s also easier to customize and design postcards, therefore making it a better option for displaying professional logos, images, and colors. The ideal postcard size is 6×11 inches as it stands out from traditional mail.
Direct Mail: Catalogs
One of the oldest forms of direct mail marketing are catalogs. Sears, Toys R’ Us, Victoria’s Secret, and more recently Amazon, have pioneered the catalog industry for decades. This allows consumers to get a look at a store’s inventory. Before the convenience of the internet, this was a unique and helpful way for consumers to associate with a brand. The return rate on catalogs falls mid-tier with a rate of 3.9%.
Direct Mail: Dimensional Mail
The most expensive, but most successful type of direct mail is direct dimensional mail. Since consumers today can be desensitized to a lot of traditional and digital marketing, a way to grab their attention is through personalized and often bold mail marketing pieces that can vary in shapes and sizes. An example of this highly effective type of direct mail would be businesses sending a sample of their product in a box that mirrored the brand campaign. Kit Kat developed a direct mail campaign that was meant to play on a “Sorry we missed you” delivery service note, but instead with a promotion of their candy bar. The return rate on this form of direct mail is the highest at 5%.
Who is the Target Audience for Direct Mail Marketing?
The age group that had the highest rate of response with 14.1% was consumers ages 45-54. This age group is an ideal target demographic for direct mail because of their slight resistance to technology. Not to mention, women age 45+ own more store credit cards than any other demographic making them an ideal target audience for business sale promotions. This age group (considered Gen X) sits between the 65+ age group (Baby Boomers) and Millennials, so they can still be persuaded to use direct mail with digital marketing strategies which, according to USPS, increased website visits by 68% when both strategies were combined.
The Cost of Direct Mail Marketing
Because of all the factors that go into direct mail marketing, the cost for this type of advertising can be high. The price for a traditional letter-type direct mail piece can cost between 30 cents to 10 dollars depending on the size of the mail. A few factors that can account for the cost of direct mail marketing include:
- Direct Mail Design Costs
- Copywriting Costs
- Quantity or Mailing List Sizes
- Postage Rates & Choices
- Format Selection
While these costs may seem high and unreasonable for a marketing strategy deemed ineffective, that’s not actually the case. Because direct mail is coming into your home and opened alongside personal letters, it’s seen as a trustworthy and more personal form of advertisement which is highly effective–especially among a younger, typically untrusting audience. Also, because these businesses who are sending you direct mail tend to be localized, you’re more likely to remember their name or logo because you have been personally exposed to them in your home and not by an exterior advertisement like a billboard or bus ad.
Pros of Direct Mail Marketing
Direct mail marketing has a few different benefits that keep this older form of advertising efficient.
Better Response Rates Than Email Marketing
Email marketing, the somewhat digital equivalent to direct mail marketing, yields significantly lower response rates than direct mail. Email marketing is often seen as impersonal, intrusive, and untrustworthy. Millennials often fear that scams are more closely attributed to email marketing than traditional advertising.
Personalized Relationship With Consumer
Because direct mail tends to be more targeted, consumers often find that direct mail fits into their lifestyle better or is more catered to their demographic. Direct mail can include recipients’ names. This allows for the brand or business to seem like a real person, thus creating trust within a brand/consumer relationship.
Direct mail has a lot of options when it comes to providing informative promotional details. Creating catalogs, postcards, or letters, gives businesses the room to be informative without being constricted to an email format. Customization is another added benefit when writing detailed information; this can be done with bold fonts, creative colors, and images.
Collecting and analyzing responses from direct mail is easy to do. A lot of direct mail will have a QR code, coupon, or digital marketing connection that can be tracked when a customer uses that specific piece of marketing. An example of this would be Kohls’ coupon code. Kohls customers will receive a mailer that can contain a coupon code worth either 15-30% off a purchase when used in store or online. Through that coupon code, the business is able to see how many people used the promotion giving them insights into its success or failure.
Cons of Direct Mail Marketing
Because this form of promotional marketing happened before the golden era of technology, it can appear less effective than digital marketing. And that’s not necessarily wrong. Here are a few reasons why direct mail marketing falters in comparison to its digital marketing sibling.
Direct mail marketing is very cost effective. As we discussed previously, the factors that make direct mail marketing so expensive lead to it not always being the best way to market.
Digital is instant, so it takes little time to receive information regarding the activity on a digital marketing campaign. It takes time for mail to be created, sent, delivered, used, and tracked. That’s why direct mail can fall behind digital marketing tactics.
When direct mail works, it really works. But when it doesn’t, which is a lot of the time, it can seem like a waste. A large majority of people discard or forget to use the promotional direct mail they receive. This leads to the notion that an issue with direct mail is its general unusability.
A New Direct Mail Marketing Strategy?
Is there a way to make direct mail new again? A way to strategize direct mail would be to remarket and retarget. Remarketing and retargeting are great marketing strategies that would allow a younger audience to be drawn into direct mail. If dimensional direct marketing yields a high 5% return, then target millennials who trust mail that is personalized and targeted for them. It will cost more money, but the return on investment (ROI) will be higher. That’s because this generation has stated its distaste for email marketing. Rebranding direct mail as a new form of traditional advertising mixed with digital advertising will make this form of marketing incredibly effective.