Making Your Direct Mail Campaigns More Cost-Effective
September 29, 2008
By Dave Henkel
With reports of an economic slow-down, many retailers and direct marketers are under pressure to trim their budgets. But at the same time, they are driven more than ever to reach qualified prospects with sales and promotional information. The ideal response to these seemingly contradictory demands is to generate higher sales per each marketing dollar spent. While this certainly is not a new strategy, it may be appropriate to review the range of options marketers have to plan and implement a low-cost high-response direct mail campaign. The key is careful planning, re-thinking your offerings and knowing how to reach qualified buyers in the most appropriate—though not necessarily the most expensive—way.
• Make a list and check it carefully. Since postage is the biggest line item in your mailing budget, it makes sense to fine-tune your list strategy based on better use of data. Be sure to actively eliminate undeliverable names, use tighter merge-purge criteria and consider dropping the least productive segments of your list. The resulting decreases in mail counts will generally be modest and overall campaign efficiency should improve. You can also use the savings to re-mail to the most promising prospects.
• Carefully consider the product or service you have to offer. A retail grocery or home products store will find the best prospects within a limited range of zip codes—as opposed to campaigns for products like travel packages, which might be mailed nationwide to a list determined by income levels or previous purchases. Gender-based targeting works well for items like women's or men's clothing, and any business can make a special appeal to existing, regular customers to show appreciation for their loyalty. It's no secret that it's easier to sell to people who know you, and thanking them helps to build a positive, long-term relationship. You might consider offering a personalized gift card for special discounts for a limited-time promotion for certain products.
• Keep it only as personal as it needs to be. Although targeting involves some level of personalization, it's generally less focused on the customer's individual preferences than so-called "highly-personalized" campaigns. Today's technologies can identify and deploy just about any type of customer information—including birthdays, sales history, income levels, hobbies and even interests in particular health or social issues. The more deeply involved you become in database mining and personalization, the more it costs—both to identify these consumers and to produce mailing pieces that incorporate a significant amount of variable data, such as color photos and graphics. Consider the product or service you offer in order to determine the appropriate level of personalization. The real estate industry, for example, is a good candidate for highly-personalized campaigns. Real estate sales generate enough revenue to justify the expense of a tightly-focused, highly-personalized campaign, and the mail counts are usually quite low.
Just because it's possible today to dig deep when it comes to personal information about your customers, this doesn't mean that using this as a marketing tool is always cost-effective or desirable. It is safe to say most recipients wouldn’t want to see their weight posted in a direct mail piece. Additionally, it is good to remember that and inappropriate personalization might even set off alarms about privacy.
• Control those production costs. Although postal rates have been increasing, marketers can do several things to contain their production and mailing costs. Here are a few top-line considerations:
• Keep an eye on paper costs. During the past year, there has been a dramatic price increase in most grades. To save money, consider using a lighter weight as an alternative. For example, it is often possible to substitute a 20# bond for 24# on a business reply envelope. Additionally, using the paper your printer inventories avoids the expense of special orders and delivery time.
• Try pre-printed products. As noted before, personalization can be very effective, but when it requires full-blown color digital variable data printing and production, it can also be costly. Most products and services can be promoted just as effectively—and personally—using a preprinted form with some laser-printed personalization, such as the name and address and mentioning the recipient's name again on the inside.
• Do you really need an envelope? A postcard can be sufficient to announce a sale or other event at a local retail location or to send consumers to your web site. Folded self-mailers offer a little more privacy and are relatively low cost.
• Work with your production provider to maximize postal efficiencies and savings. Use BMC/SFC entry point discounts for larger mailings and commingling, which bundles your mailings with those from other mailers, for smaller quantities.
Finally, keep your message foremost in every campaign. Keeping it simple and clear, and designing your mailer around the core message often has the greatest impact, making your offering right on the money no matter what.
Dave Henkel is president of Johnson & Quin located in Niles, Illinois. Johnson & Quin is a national leader in targeted full service direct mail printing and production, offering the latest data and personalization technologies. He can be reached at dhenkel@J-QUIN.com.
Sales & Marketing Management Magazine
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