How to Correct And Improve Direct Mail Response Rates
Mark Hale ‐ December 31, 2013
Why you are not getting responses from your advertising or direct mail?
As long as 99.999% of the U.S. population has a mailbox, direct mail will be the most efficient means to market for most businesses. Direct mail is the simplest means to advertise there is because everyone has a mailbox and the USPS delivers the mail regularly. Having said that, why do some businesses fail to get results?
Of all the advertising mediums available to you direct mail is the easiest to de-bug when response rates are lower than desired.
Failure of a direct mail program boils down to one or more of the following situations:
- The mailing list. The list is either outdated, old or is targeted to the wrong public for the message. The more demographic data you have on who you want to reach the easier it will be to get a good list. Wilson Printing can help you find a mailing list.
- The ad is weak. Often this is the most common reason why a direct mail campaign fails because there are several variables. A weak ad can be caused by several things, including but not limited to, poor design, too many offers or products on the piece, weak offer, no “call to action” or an uncompetitive product or offering. The more homework you do on what your competition is offering and the better you can communicate the benefits of your product or service to the designer the more effective your ad will be. Hiring someone with a track record of designing successful direct mail pieces can help you and is well worth the expense because they can take the basic information you provide and design an eye-catching piece.
- Low or no frequency. This one is usually less likely because if you have a good targeted mailing list and a well designed postcard, promoting a competitive product with a compelling offer to buy now, with a message that is targeted to the recipients on the mailing list, you WILL get some sort of response from the first mailing. Keep in mind that you will get more response the second or third time you mail to the mailing list. This is because with all the competitive noise in the market it takes two or three times for a person to see the ad before it registers. Also, people come in and out of the buying zone randomly and you never know how many people are shopping to buy your product now, but over the next three or four months many more will be buying than in the first month you advertised.
If you are going to use direct mail, or any other advertising medium for that matter, you are going to have to have the correct point of view regarding advertising or you will never stick with anything long enough for it to be viable. There are and never have been any magic panaceas that will 10x your sales with one ad or one mailing, it takes time.
First, do your homework. Make sure people want what you are selling. Survey your customers and find out what they want. Look at old invoices to see whom your best customers are, where they live and what they buy. Have all the benefits to the customer and the reasons to buy your product or service NOW at hand before you start designing the ad.
Second, you have to know what a customer is “really” worth to your business. When I say worth I don’t mean just a single purchase, but long term what is a customer worth. Knowing what a customer is really worth helps you to quota how many customers you need to make a return on your investment.
Example: Lets say you are selling a product that sells for $200 and you are spending $3000 on a direct mailing. Taking just the one time sale of $200 you would need around 30 – 35 sales to double your investment.
However, with the above example, a customer once they buy your product usually spends $1,500 per year and they stay with you for an average of three to five years. That means a customer’s value is worth around $4,500 to $7,500, ($1,500 x 3 years).
So if you have 30 to 35 customers, that would really be worth $135,000 to $262,000 dollars to your business, which is a lot more than the $200 you received for that first sale.
Your return, if your 30 customers came in off a $3,000 investment, would be 45 times. Which would be stellar and also unrealistic in today’s marketplace. You have to think in terms of the real customer value or you will always be disappointed in your advertising.
Finally when working with the graphic designer on your ad “be your own advisor”: DO NOT show and ask the opinion of the ad or postcard to your office girl, secretary, shop foreman or cousin. These people are well meaning but most likely are not marketing experts and often will make suggestions that will weaken the ad.
The only person’s opinion of your advertising that really matters is that of the customer. I suggest showing it to several customers, say 10 to 20, to get their feedback. It is called a flash test. Show them the ad for 15 seconds and ask them what caught their attention in the ad. You want to find out if they “got” the main point of the ad and if the offer got their interest.
Write down what they say and tabulate the similar responses. If the majority of the customers you flash test like the ad, understand what the offer is and would buy, you have a good idea of the impact of the ad.
The only rules of doing a flash test is that you have to show it to more than a couple customers (the more the better) and the people you show it to have to be in the demographic group that the ad was designed to reach.
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