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.
Saturday, October 27, 2007
Friday, October 26, 2007
Direct Mail Brings Five Percent Increase in Sales
According to the Direct Marketing Association’s yearly report, The Power of Direct Marketing, direct marketers could realize up to a 5.2% increase in sales, which is 1.5% lower than the growth realized in 2006, due to the continuing economic slowdown. Direct sales could hit $2.025 trillion in 2008.
To what is this continued growth in direct mail attributed? It’s felt that marketers continue to source money in to direct marketing due to its ROI when compared to other forms of advertising. With an economy that is continuing to lag, direct mail marketing allows companies to see hard results for their advertising dollar. While many industries continue to see an increase in their direct mail marketing investment, there are still some that are cutting back their direct mail advertising.
According to the direct marketing report, manufacturing, financial banks, and education services are among many industries that continue to put significant money into direct marketing advertising. Lags are seen in areas like petroleum, real estate and furniture industries.
Dr. Peter Johnson, the Direct Marketing Association’s research strategy and platforms vice president, and lead author of the report notes that direct mail marketing will “continue to help sustain the overall US economy.” This estimation is based on the fact that as much as 10.2% of the US GDP, or $1.41 trillion of demand is represented by direct marketing.
Employment in direct marketing in 2007 is responsible for 10.6 million jobs. A prediction of a 2.2% increase is expected for next year. Internet marketing has predicted expenditures of $23.6 billion in 2008, which is almost a $4 billion increase from 2007.
Despite this growth, many company’s marketing departments are concerned about the state of the economy. If the housing market continues to stagnate and fuel costs keep climbing, it is possible that overall marketing expenditures could be adversely affected. Considering direct marketing’s effect on our GDP this year, a decrease in its economic viability is something to be concerned about.
To what is this continued growth in direct mail attributed? It’s felt that marketers continue to source money in to direct marketing due to its ROI when compared to other forms of advertising. With an economy that is continuing to lag, direct mail marketing allows companies to see hard results for their advertising dollar. While many industries continue to see an increase in their direct mail marketing investment, there are still some that are cutting back their direct mail advertising.
According to the direct marketing report, manufacturing, financial banks, and education services are among many industries that continue to put significant money into direct marketing advertising. Lags are seen in areas like petroleum, real estate and furniture industries.
Dr. Peter Johnson, the Direct Marketing Association’s research strategy and platforms vice president, and lead author of the report notes that direct mail marketing will “continue to help sustain the overall US economy.” This estimation is based on the fact that as much as 10.2% of the US GDP, or $1.41 trillion of demand is represented by direct marketing.
Employment in direct marketing in 2007 is responsible for 10.6 million jobs. A prediction of a 2.2% increase is expected for next year. Internet marketing has predicted expenditures of $23.6 billion in 2008, which is almost a $4 billion increase from 2007.
Despite this growth, many company’s marketing departments are concerned about the state of the economy. If the housing market continues to stagnate and fuel costs keep climbing, it is possible that overall marketing expenditures could be adversely affected. Considering direct marketing’s effect on our GDP this year, a decrease in its economic viability is something to be concerned about.
Direct Mail Continues to Grow
According to the Direct Marketing Association’s yearly report, The Power of Direct Marketing, direct marketing is anticipated to grow in all areas, including expenditures, return on investment (ROI), sales and employment for 2008. This is despite an economy that is lagging in most areas.
“For the first time ever, direct marketing represents more than 50 percent of total advertising expenditures in the US, growing faster than total advertising spending and the US economy as a whole,” said Dr. Peter Johnson, the Direct Marketing Association’s research strategy and platforms vice president, and lead author of the report. “Marketers are moving dollars into direct marketing because of its higher ROI relative to other forms of advertising. This makes ‘direct’ a more reliable engine for sustaining sales, incomes, and jobs at a time when the mortgage and energy markets are heightening economic uncertainty.”, as noted on the DMA website. “Overall,” said Johnson, “business performance in 2007 is likely to be measurably brighter than it would otherwise be, thanks to the effectiveness of direct marketing.”
“For the first time ever, direct marketing represents more than 50 percent of total advertising expenditures in the US, growing faster than total advertising spending and the US economy as a whole,” said Dr. Peter Johnson, the Direct Marketing Association’s research strategy and platforms vice president, and lead author of the report. “Marketers are moving dollars into direct marketing because of its higher ROI relative to other forms of advertising. This makes ‘direct’ a more reliable engine for sustaining sales, incomes, and jobs at a time when the mortgage and energy markets are heightening economic uncertainty.”, as noted on the DMA website. “Overall,” said Johnson, “business performance in 2007 is likely to be measurably brighter than it would otherwise be, thanks to the effectiveness of direct marketing.”
The direct mail market predicts $173.2 billion in advertising expenditures’ by the end of this year, showing a 4.4% increase over last year. The ROI for these expenditures is $11.69/dollar spent, when taking into consideration the two trillion dollars in subsequent sales this year. The final numbers for 2006 were affected by the steep decline in the housing market, increases in energy costs as well as a decrease in auto sales. Up to a 5.5% increase in response rates is expected in commercial email, Internet marketing and direct mail.
While some mortgage companies struggle in this lagging economy, one marketing firm is helping its mortgage clients gain market share and achieve a 3% (and growing) response rate! Before starting your next direct mail campaign, attend a free webinar with Variable Thinking, and learn in under one hour how you can achieve higher response rates and sales. Attendees are entered to win a free three day/four night trip to the Grand Bahamas!
Saturday, October 13, 2007
Chicago Direct Mail Agency Achieves First Online
We are proud to announce that our newly redesigned website (http://www.variablethinking.com/) is the first to integrate iPhone-like technology online.
This new technology allows visitors to grab and drag images in our portfolio with their mouse, or control the movement of images with a scroll bar at http://www.variablethinking.com/PortfolioFlash.aspx.
This new technology allows visitors to grab and drag images in our portfolio with their mouse, or control the movement of images with a scroll bar at http://www.variablethinking.com/PortfolioFlash.aspx.
Variable Thinking is known as being a creative leader in the industry and is praised for its forward thinking marketing solutions. The company was the first to offer the entire marketing solution under one roof from graphic design to direct mail fulfillment and tracking.
About Us
Variable Thinking is a full-service direct marketing firm that conceptualizes, designs, prints, double bar codes, and tracks your targeted direct mail! We also offer strategic demographic lists and personalized URLs (PURLs/microsites) to further increase response rates. From start to finish, our 30,000 square foot facility is equipped to meet all of your marketing needs!
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