Increase Direct Mail Response Rates Part One

Direct mail advertising allows for cost-effective ads to reach a target market, keeping the ROI, return on investment, high. But, how can companies increase the response rate for direct mail advertising?

Know Your Customers—And How to Reach Them
The first step to increasing direct mail response rates is to segment your existing customer database. Market segmentation narrows your mailing list to a more specific group of individuals that have enough in common to warrant a like-response to your ad. Companies report their highest response rates usually when a personalized direct mail piece is sent to a highly segmented mailing list. By putting your customers into groups based on interests, hobbies, gender, geography, and lifestyles you can customize offers based on their unique needs and increase sales.

Market segmentation has several benefits:
A. You identify your core customer. The person who is most likely to buy your
product or service.
B. You can spot new trends, and opportunities, within the market.
C. You can see gaps in the database and focus on which mailing lists to rent.
D. You can increase sales, and the lifetime value of customers, by creating
custom offers for specific segments.

Other segmentation criteria can include trends, employment status, payment method, industry, family status, and buying frequency among others.

Stay tuned...more tips for increasing direct mail response rates to come.

Estimating Response Rates for Relevant Marketing Campaigns

Many companies know that personalizing their direct mail will increase response rates and customer loyalty, but have no way to estimate to what extent.

During the Q&A session of a recent digital printing seminar discussing personalized direct mail, a participant asked if companies experienced an average response rate increase when they switched from static to personalized direct mail.

According to James Mekis, the Director of Technology for PODI, companies are experiencing a 50% increase, or doubling response rates when they make the switch. PODI’s own data indicates that (for a relevant, personalized campaign) typical response rates range from over 3% for direct sale to 13% for loyalty campaigns.

But it takes more than personalized marketing to increase response rates and ROI. You need a relevant offer sent to a targeted mailing list. What is a “relevant offer”? According to a 2007 W. Caslon and Company report titled, “Response Rate Report: Benchmark Information for Relevant Marketing Programs” a relevant marketing piece is defined as:

“…a message about a product that the recipient needs, delivered when the recipient is ready to receive it.”

According to the Direct Marketing Association, static mailers to an existing customer database generate a 1.75% response rate on average. The next time you send out a direct mail piece to your database, why not send half static pieces and the other half personalized offers. This is an excellent way to see how one little change in your direct mail can greatly impact your bottom line.

According to PODI, “If you put together a great concept, a great design, and a great list, and make the offer really relevant, response rates can go through the roof.” Variable Thinking can help you achieve those results. Join our free strategic marketing webinar every Wednesday from 2:00 -2:45 p.m. CDT.

To register for this, or future webinar’s visit http://www.variablethinking.com/webinar.aspx.

All participants receive a free marketing toolkit which includes lead generation workbooks, personalized marketing PDF books, and other valuable resources for free.

Attend the webinar and learn more about how Variable Thinking can help you achieve:

• Higher response rates
• Greater satisfaction rates
• Faster response time
• Higher average order value
• Higher participation rates
• Higher conversion rates
• Reduced customer service complaints
• Greater understanding of product and service benefits
• Increased sales or donations