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What can Direct Mail offer Marketers in a Digital World?

Here are a few thoughts about "Non-Line Marketing" that I pulled together with Chris Combemale, my Co-Founder of The Email Academy... 

As these difficult trading conditions continue many organisations are looking at ways to reduce their direct marketing costs without adversely affecting sales. One quick win has been trying to migrate customers from expensive off-line channels to cheaper on-line ones; speaking to people through email, at about half a pence a message, is a more attractive than saying the same thing through direct mail at maybe fifty pence a message. This cost-differential (email is 100 times cheaper than direct mail) means that email is a much more forgiving medium - your conversion rates could be half as good through email but still be 50 times better off in terms of cost per sale!

However, there is a business risk involved in this channel migration. If you ask people to “tune out” of nasty, expensive, un-green direct mail then you put pressure on your email marketing to perform. In my experience over the past decade across Europe there are very few client companies that have optimised their email marketing strategy and execution to make this risky channel migration pay. So I was delighted to read a case study from Marketing Sherpa today that suggests some steps all companies can take to reduce risk AND increase sales.

To summarise, an independent travel agent encouraged people to opt into their email programme to reduce the costs of servicing customers – all good so far! But in order to stimulate sales they decided to run a multi-channel campaign. With some simple data appending on their prospect file (adding life-stage and income variables is easy if you have a post-code), they selected the most affluent prospects for the campaign, as well as targeting all existing customers. They then used a combination of direct mail and email to promote personalised offers, with a range of on and off-line calls to action.

Here is the personalised post-card, with a "reminder" of the previous transaction in the heading.

And here is the email message, with the same "reminder" of previously-enjoyed holidays... 

 
Now here’s the good stuff...

“The team noticed that those who received both the print and email communications were twice as likely to visit their personalized web pages.

- 6% of those who received only email visited their webpage
- 12% of those who received both email and direct mail visited their webpage

That doubling in response also translated to twice the conversion rate and twice the revenue from customers who received both communications, as opposed to customers who only received one communication.”

http://www.marketingsherpa.com/article.php?ident=31299

The conclusion for me is clear. Our customers live in a multi-channel world and as marketers we need to embrace “non-line marketing”...using channel-neutral planning to harness all direct channels to engage with people. Humble direct mail can be used to re-enforce on-line messages and drive prospects to web sites in much the same way that email can be used to drive footfall to physical stores. And when we use both these channels in well-planned, targeted campaigns we enjoy conversion rates far beyond that which each channel achieves on its own. That’s heartening news for the direct marketing industry!

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Reader Comments (3)

I happen to be the Email Marketing Designer & analyst ofthe top competitor of backroads and the interpretations of the data is not exactly that simple as it is explained here.Segmentation of the customer database is the primary driving factor. The distinct difference in the behavior pattern of Propects vs. Former travelers is what drives the results specifically for our industry and our model

July 20, 2009 | Unregistered CommenterBibi Mukherjee

Hi Bibi, and thanks for making that point. I think we are both in agreement about what makes this campaign successful; I like the way that they segmented their data into customers and prospects and then used this to drive the message CHANNEL. Since the propensity of lapsed customers to buy again was higher than that of cold prospects this company could afford to invest in a more expensive cost-per-contact channel (direct mail) for customers, whilst only serving email to the prospect group. Doing email to all would have led to sub-optimised conversion rates, and direct mail to all would probably have given too high a cost per sale for the prospects. Of course, that's another test for another day!

David

July 21, 2009 | Unregistered CommenterDavid Hughes

I believe that direct mail drives a lot more online traffic than anyone wants to admit. The problem is the lack of ability to track the response. Even after 10 years of trying.

Plus, people still love to hate the mail mail they secretly love to receive.

Pull the plug on direct mail and watch your traffic go down.

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