Direct mail household response rate is 5.1% (compared to .6% email, .6% paid search, .2% online display, .4% social media). This is the highest response rate Data Marketing & Analytics has ever reported, since coming out with the Response Rate Report in 2003.
Direct mail median household return on investment is 29% (compared to 124% email, 23% paid search, 16% online display, 30% social media).
At 6.6%, over sized envelopes have the greatest household response rates over other mediums (followed by postcards at 5.7% and letter-sized envelopes at 4.3%).
At 37%, over sized envelopes have the greatest household return on investment over other mediums (followed by postcards and letter-sized envelopes at 29%).
The response rate for direct mail among people aged 18-21 years old is 12.4%.
The top response rate tracking methods are online tracking (61%), call center or telephone (53%), and code or coupon (42%).
For every $167 spent of direct mail in the US, marketers sell $2095 in goods.
The Bottom Line – Direct mail has the greatest impact because it offers a tangible experience for the customer. Over sized pieces stand out the most.
Personalization Boosts the Response Even Further
Adding a person’s name and full color in the direct mail can increase response by 135%.
Adding a person’s name, full color and more sophisticated database information can increase the response rate by up to 500% vs not doing any of these things.
Targeting customers on a 1:1 level increases response rates up to 50% or more.
The Bottom Line – People are even more likely to respond to a marketing message when it feels like it was written just for them.
It’s a Multi-Channel World Out There
The average person receives more than 2900 marketing messages a day.
It can take up to 18-20 touch points to reach a customer for the first time.
The average number of mediums used by marketers is 3.4% (up from 2.7% in last year’s study).
Only 11% of marketers are just using one medium.
Single media users are most likely to use email (54%) or direct mail (22%).
The Bottom Line – Your customers are on multiple platforms. Are your messages clear and consistent across all of them?
Direct Mail and Digital Work Together
90% visit website first before calling.
96% leave without making a purchase.
Direct mail with digital ads yield 28% higher conversion rate.
Marketing campaigns that used direct mail and 1 or more digital media experienced 118% lift in response rate compared to using direct mail only.
Website visitors who are re-targeted are 70% more likely to convert.
26% of customers will return to a site through re-targeting.
The Bottom Line – Direct mail response rate can be difficult to track, because not everyone calls in right away. Most customers head straight to the web to learn more about the product online, rather than calling to speak to a sales representative about the product directly.
It’s Easier to Nurture Existing Interest than Create New Interest
It is 10 times harder to create new interest than nurture existing interest.
It can cost as much as 5-12 times more to acquire a new customer than retain an existing customer.
The probability of selling to an existing customer is 60-70%, vs. the probability to sell to a new customer at 5-20%.
A 5% increase in retention yields profit increases of 25-95%.
The average response rate for direct mail pieces sent to former customers of a given brand is 18.4 percent.
The household cost per acquisition for direct mail is $26.40 (compared to $10.32 email, $20.32 social media, $16.22 paid search, $24.75 internet display).
The Bottom Line – Use direct mail to nurture existing interest, keeping current customers and prospects engaged and delighted. While the cost per acquisition is higher for direct mail, average response rate and median return on investment is competitive enough to make up the difference.
Success is in the Data
40% of a direct marketing campaign’s success is in the data.
In general, purchased lists have a margin of error as high as 20-30% for various reasons (people move, change jobs, get married/divorced).
73% of firms aspire to be data-driven but only 29% of firms succeed at turning data into action.