I have been writing for the past couple of years that Direct Mail is on its way back. It continually comes up as an opportunity in keynotes at industry meetings. It appears that data is supporting those claims. The 2015 DMA Response Rate Report is reporting good news on the Direct Mail front validating claims I have made that it now outperforms digital marketing.
In a nutshell, here is what they are reporting:
The Good News
- Direct mail response rates outperform digital channels by a long shot. Direct mail achieves a 3.7% response rate with a house list and a 1.0% response rate with a prospect list. All digital channels combined only achieve a 0.62% response rate (Mobile 0.2%; Email 0.1% for a Prospect list and 0.1% for House/Total list; Social Media 0.1%; Paid Search 0.1%; Display Advertising 0.02%). The telephone had the highest response rate at 9-10%.
- Cost-per-acquisition for direct mail is very competitive. Direct mail stands at $19, which fares favorably with Mobile and Social Media (both at $16-18), Paid Search ($21-30), Internet Display ($41-50) and even email ($11-15).
- 82% of respondents expect to use the same amount of direct mail, or more, in the coming year.
- Formats are playing a role. According to the study, oversized envelopes have the best response rate at 5.0%, followed by postcards at 4.25%, dimensional 4.0%, catalogs 3.9% and letter-sized envelopes 3.5%.
- Marketers continue to embrace multi-channel marketing, with 44% of the respondents using three or more channels for their marketing efforts. In these instances, the most popular channels tend to be email, direct mail, and social media.
- Direct mail offers strong return on marketing investment. It returns the same ROI as social media (15-17%).
The Not-So-Good News
- According to the study, the main challenges with direct mail are the cost, the effort to deploy it and the difficulty of tracking it. We’ve written extensively about the need for the Postal Service to keep postage affordable, most recently in our thoughts for the new Postmaster General, Megan Brennan. We hope they are listening, as keeping the price of direct mail competitive is crucial to marketers, service providers and consumers alike.
- Direct mail usage is down, with just half of respondents reporting they use the channel.
The Not-So-Good News That is Actually Good News
- The feedback on the difficulty with tracking direct mail was painful and puzzling to read. We’ve written at length about ways to track direct mail ROMI. If you’re having trouble tracking the results of your direct mail campaign, this suggests there may be flaws in the strategy or analysis. If you’re experiencing these difficulties, the good news is we can help. Get in touch with us. We’d be happy to get your campaign strategy and analysis on track.
- While fewer companies reported using direct mail, that can be very good news for those who do as there is less competition in the mailbox for your prospects’ attention.
So, are you equipped to handle this new opportunity?
Does your print shop have the ability to provide UV coating for direct mail? Or, maybe your customer will want to use overlaminates to stick out from the rest? Can you help them use direct mail to call or hit a landing page to track the response rates?
Direct Mail, it’s back.