There is perhaps a common misconception that Direct Mail campaign involves tens or even hundreds of thousands of items – but for effective Direct Mail there are many more important factors than size.
Size isn’t everything
For many businesses the days of massive runs of Direct Mail may be over. The continued increase in the costs of design, printing and postage means that they simply cannot afford to run high-volume campaigns. Of course, before DM is put into permanent cold storage, advice from a bulk mail service specialist could help reduce costs on all aspects of the campaign and a reduction in volume will dramatically increase the per-unit-cost which will affect the effectiveness of the campaign.
Unit cost, however, isn’t the only thing to consider when pitting a campaign together. Return on investment (ROI) is a much more important factor. Businesses need to decide how much they are willing to pay for each new customer – and this will be in part determined by how much on average your customers spend. Your Direct Mail campaign may result in sales that are lower than the cost of the campaign itself, but may result in an increase in loyal customers who will continue to purchase over many years. Your DM campaign will need to maximise these long term benefits as well as create an offer that appeals to the target audience.
A recent web item reported the following case:
“Here’s an example a colleague shared with us of a small mailing he worked on for one of his clients. The client (in the enterprise software industry) had worked hard to put together a list of extremely qualified leads. They further narrowed this list down to the top 50 potential clients they wanted to contact. These 50 prospects (all ultimate decision-makers) received a Federal Express package that included an expensive brochure, a letter, and something rather unusual in direct mail circles: A pre-paid cell phone, programmed to work only between the prospect and the software company.”
And sometimes a small mailing-with a high per unit cost-can be extremely effective.
Know your audience
The above example shows the success that can come by an in depth knowledge of the target audience. In fact, running smaller DM campaigns can help you develop a very in depth knowledge of your potential market. Managing a campaign of 50 people or 100 people means you can have a close relationship with those people but you can still use data effectively when creating a campaign for 100s or even 1000s – mining data to get an understanding of their buying history as well as their motivation and desires as consumers.
Calculating the cost
All the costs need to be taken into account when running a DM campaign – and don’t forget the ‘hidden’ costs such as the time spent on the campaign as opposed to other forms of marketing. What will you spend on the customer list you have built? And what kind of response can you reasonably expect-and what is that expectation based on?
In summary, it’s not size that matters but quality. A creative campaign which maximises the effectiveness of the data you have and creates a compelling offer, will be a successful campaign regardless of the volumes involved.
Image Credit: takomabibelot