3 Elements to Calculate to Measure ROI on Direct Mail

Actually calculating the true ROI from a direct mail campaign can actually be quite tricky. Essentially these three campaign elements need to be assessed:

  • Actual campaign costs
  • Actual campaign income
  • Intangible campaign benefits

We now proceed to explore all of the above in more detail.

Actual campaign costs

The first element of calculating the ROI is to accurately calculate the full campaign costs. These should be recorded in either a separate spreadsheet and/or in a separate part of the P&L accounts. Examples of direct mail costs include (but are not limited to) – data cleansing, list acquisition, packaging (e.g. polywrap), postage and printing. Actual costs will vary from one campaign to another and will also vary from one company to another.

How can we help reduce costs – Here are some examples of how we can help reduce costs:

  • Data management – we can reduce the number of goneaways and therefore associated costs through data cleansing techniques
  • Fulfilment – we have an extensive direct mail fulfilment operation and can ensure client’s direct mail campaigns are very fulfilled at very low costs
  • Postal discounts – we can save client’s money on the cost of posting campaigns
  • Printing – we print both in-house and through the use of print partners, we are confident we can save client’s money compared to their current print deals

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Actual campaign income

The second element of calculating the ROI is to accurately calculate the actual campaign income. It can be difficult to distinguish between existing business income and campaign specific business income. It’s therefore important to add analytics to a campaign which helps to capture specific responses. Examples of analytics could include a campaign specific postcode or telephone number or a promotional offer only applicable to the campaign. The true income of a campaign is not just a direct sale of a promotional item but also the derived sales, e.g. additional items purchased as well.
How bakergoodchild can help monitor and increase income – we have extensive experience in direct mail campaigns, here are some ways we can increase income:

  • Analytics and tracking – We can add unique phone numbers, postcodes or PURLs (personalised URLs) to a campaign as well as to advise on ways to use onsite analytics to track online responses to campaigns
  • Direct mail experience – Through our vast experience we can help “tweak” a campaign in all the required areas which will squeeze every last realisable income from your customers by being responsive to their needs and by providing an irresistible campaign
  • Personalisation – Personalisation increases campaign income by personalising the campaign to the user’s specific interests and desires thus increasing income compared to non-personalised campaigns.
  • Technology – We use the latest available technology to “spice up” a campaign and increase its income; this includes adding near field communication and/or augmented reality as just two examples.

Intangible campaign benefits

The third and final element of calculating campaign ROI is to determine intangible benefits directly attributable to the campaign. The list is potentially endless but here are some clear benefits:

  • Customer satisfaction – There will be a general feeling of customer satisfaction by managing a campaign well which whilst difficult to measure is good for the future
  • Data accuracy – As a by-product of cleansing data for the campaign the data will be available throughout the company for other initiatives too
  • New prospects – Although a campaign may not have clinched a sale it may still have generated new prospects from telephone calls, emails and newsletter subscribers, etc.
  • There are other intangible benefits too, but it’s not practical to list them all here, contact us for more details

For more information about ROI to expect from a direct mail campaign please visit the following previously published bakergoodchild blog articles and infographics:

For more information about how to attain the maximum ROI from a direct mail campaign please contact our experts on 0800 612 1972 who will be delighted to advise on techniques to use. Or if you prefer please complete our contact form.

Contact our team to find out more - click here.