It’s always tempting to look for ways to spend less, and that goes for marketing campaigns, too.
Of course, it’s easy to understand why. Direct mail has print costs, postage, data processing, fulfilment, creative, personalisation and more moving parts that sit behind getting a piece of mail from a database to someone’s front door.
So it’s natural for everyone to ask: where can we cut costs? But the better question is, instead: Where should we spend, and where can we save without compromising the whole thing?
Because the cheapest direct mail campaign isn’t necessarily the most cost-effective, never mind the most effective, overall. Spending a little more on the right part of a campaign will generate more revenue, while cutting the wrong cost can leave you with a cheaper campaign that doesn’t really achieve anything.
The real skill is finding the sweet spot between cost, quality and response. Since we have over 30 years’ experience in the industry, we know all the details. Here’s how you should think about it:
Start With the Economics of Your Campaign
Before deciding where to save, figure out what you’re actually paying for.
A direct mail campaign is rarely just a printing bill. Depending on the campaign, your costs might include data preparation and cleansing, creative development, printing, personalisation, fulfilment, postage, tracking and follow-up.
Some of these costs are relatively fixed. Others change depending on the size and complexity of your campaign. And, importantly, not every cost has the same impact on performance.
For example, spending more on data cleansing may seem like an additional expense, but if it removes thousands of inaccurate or duplicate records, you’ll save on postage, while improving campaign targeting.
Likewise, personalised printing costs more than producing one generic mailer. But if personalised content makes a difference to your audience and generates a better response, the additional production cost is easily justified.
So, looking at each cost in isolation is misleading – instead, look at what the cost does for the campaign.
Where You Shouldn’t Be Afraid to Spend
Sometimes, trying to save a few pounds here ends up costing you a whole lot more there. In direct mail, these genuinely useful and worthwhile expenses tend to come up in certain areas:
Good Data
Good direct mail starts long before anything gets printed.
If your mailing list contains outdated addresses, duplicates, suppressed contacts or incomplete records, you’re paying to send communications that can’t produce returns. So, although data cleansing and validation looks like an additional cost, it tends to improve the entire campaign’s economics.
Better data means fewer wasted mailpieces, more accurate targeting and a clearer understanding of who you’re communicating with. And when personal information’s involved, it also supports responsible data handling and GDPR compliance.
Personalisation
Personalisation isn’t really putting someone’s first name at the top of a letter and calling it a day.
Modern direct mail can use customer information to tailor offers, product recommendations, messaging, imagery and CTAs to different audience groups.
A lapsed customer could receive a different message from someone who purchases regularly. A high-value customer might receive a different offer from a first-time buyer. The additional data processing and production complexity can increase costs, but it’ll also make the communication a whole lot more relevant.
The important thing is to ask whether the personalisation is likely to change your customer behaviour. If it does, it’s an investment, not just an expense.
Testing
Testing can feel like an unnecessary expense when you’re already paying to produce a campaign.
Why not just pick the strongest version and send it? Well, because you don’t really know which version is strongest until tested.
A small A/B test might compare different headlines, offers, formats, CTAs or levels of personalisation before you commit to a larger rollout. That initial test adds a layer of cost and planning, but if you’re sending tens or hundreds of thousands of pieces, it’ll be cheaper than using the wrong approach/option.
Also, if you compile the data from your tests, you’ll get something even more valuable: info on what your audience responds to.
Note: We’ve looked at this in more detail in our guide to A/B testing in direct mail.
Tracking
You can’t improve what you can’t see.
Unique URLs, QR codes, promotional codes, dedicated phone numbers and campaign-specific landing pages all help connect the dots between what you sent and the action that follows.
Tracking adds some complexity, but gives information that answers the question: Did this campaign work? Without that info, you’ll make your next campaign choices on assumptions rather than evidence.
Where You Can Save Without Hurting Performance
Not all elements of a campaign carry the same weight, and we know of a good few ways to cut costs (without cutting performance). The trick is identifying operational waste rather than cutting things that contribute to response. Here are a few efficiencies to look for:
Choose the Right Format
Bigger isn’t always better.
A beautifully designed, oversized mailpiece might look impressive, but if a simpler format communicates the message just as well, the additional production and postage costs may not be justified.
Equally, moving over to a cheaper format doesn’t automatically mean you’re saving if it makes the communication harder to read or less engaging.
The right question is: What format delivers the job we need it to do at the lowest sensible cost?
Look at Postage Strategically
Postage can represent a substantial proportion of a direct mail campaign, especially at scale.
But again, the cheapest option isn’t necessarily the right one. Mailing houses can often help organisations take advantage of volume efficiencies, appropriate postal services, sorting and preparation processes that may be difficult to replicate when managing everything internally.
This is one of the reasons the economics of a mailing house are different from simply comparing a print quotation with an internal production cost.
The right partner can help optimise the entire journey from finished print to postal entry. We’ve covered the mechanics of this in more detail in our guide to reducing postage costs in direct mail campaigns.
Consolidate Where it Makes Sense
If you’re regularly sending multiple mailings, it’s worth checking whether production and fulfilment can be planned more efficiently.
Combining appropriate volumes, coordinating production schedules and avoiding unnecessary small runs can help reduce handling and production costs.
Which doesn’t mean throwing unrelated campaigns together simply to save money, since you’ll then be dealing with completely different delivery requirements. But where timing and format allow it, planning at campaign level rather than mailing by mailing is the way.
Reduce Unnecessary Complexity
Every additional component in a mailing can introduce another cost.
Extra inserts. Multiple formats. Complex folding. Unnecessary finishing. Separate fulfilment stages. None of these are inherently bad – sometimes they’re exactly what a campaign needs. But it’s worth asking whether every element has a job (and is good at it).
If an additional insert doesn’t improve understanding, response or customer experience, is it really earning its place?
The goal isn’t to strip the campaign back until it’s tasteless and lame. It’s to make sure that every element is contributing something.
The False Economy of Cheap Direct Mail
This is where cost and ROI become particularly interesting.
Imagine Campaign A costs £8,000, while Campaign B costs £10,000.
Obviously, at first glance, Campaign A looks like the winner.
But now imagine Campaign A generates £12,000 in attributable revenue, while Campaign B generates £30,000.
You’ve spent £2,000 less on Campaign A, but generated £18,000 less revenue.
This is the fundamental difference between cost control and cost efficiency. Cost control asks: How can we spend less? Cost efficiency asks: How can we generate more value from what we spend?
For direct mail, the second question is usually much more useful.
The Sweet Spot is Different for Every Campaign
There isn’t a universal formula for how much you should spend on data, print, personalisation or postage, because it all depends on context.
A high-value B2B campaign might justify significantly more investment per recipient than a large-scale retail promotion.
A regulatory communication has different priorities from a customer acquisition mailing.
A charity fundraising campaign may measure success through average donation and lifetime supporter value, while a membership organisation may focus on renewal rates.
The right balance therefore depends on: Audience + objective + value of the outcome + campaign scale + required response.
So, Where Should You Spend and Where Should You Save?
The answer isn’t simply “spend more on the things that matter and less on everything else.” It’s about understanding what each part of the campaign contributes.
Spend where it can change the outcome: good data, meaningful personalisation, effective creative, testing, tracking and the operational expertise needed to deliver the campaign properly.
Look for savings where they remove waste: inefficient formats, unnecessary production complexity, avoidable postage costs, poor data and processes that create unnecessary handling.
And always judge those decisions against the result you’re trying to achieve. Because a direct mail campaign that costs 10% less but generates 30% less revenue isn’t a savings – it’s just a smaller campaign.
At bakergoodchild, we help organisations with the whole mailing journey, from data preparation and personalisation through to print, fulfilment and postal distribution. That means we can identify opportunities to improve efficiency without losing sight of what the campaign is actually there to achieve.
If you’re planning a new campaign or looking at how to make your mailings more commercially effective, give our team a call on 0800 612 1972. We’d be happy to look at the process with you and identify where you can invest for better results.
