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DIRECT MAIL CAN BE AN EFFECTIVE PART of an independent sales organization's marketing campaign,
or it can be an effective waste of time and money, depending on a company's approach.
Some prospects prefer e-mail communications, some prefer the telephone, some prefer mail, while
others prefer another method or some combination of methods. If a company doesn't use some direct mail, it neglects
the section of its potential customer base that prefers this type of communication.
Direct mail heightens prospect awareness about a company - the value of which can't always be
measured, but is important - and helps generate leads for sales staff. By introducing the company to a prospect
via direct mail, a company can provide initial information about itself, "warming" a prospect to its products and
services. By supplying the company's phone number and a reply card, the company can discover which prospects are
truly interested, so they can better tailor their follow-up sales efforts, without wasting time on prospects who
have little chance of becoming customers.
Direct mail can result in a 5 percent response rate, or a one-half percent response rate, or
somewhere in between. The response rate depends on the effectiveness of the mailer itself, the mailing list and the
follow-up. While most of the response will follow soon after the mailer, a smaller percentage can come in several
weeks or even several months later.
By following a few simple steps, a company can help re-sponses to its direct mail be near the
upper end of that range.
Use "Clean" Data
It's critical to measure the effectiveness of the direct marketing campaign, both from a
management and a marketing standpoint. So, even though it costs a little extra, pay the additional fee for returns
of items with bad addresses. This information should be used to "scrub" the company's database once each campaign,
refining contact information, deleting some contacts (i.e., ones who have gone out of business) and adding others.
If the company spends the money and the effort to do this during the first mailing of a
multiple-mailing campaign, it will pay for itself after the first mailing.
In addition to scrubbing the database once each campaign, it should be scrubbed once per year.
Again, the cleaner the database, the fewer items will be mailed to bad addresses, so the lower the cost, and the
higher the response rate should be. The return on investment will also be higher.
The database can be built through several different methods. If the target market is local
businesses, the telephone book offers one, often overlooked, resource. If targeting a local market or multiple
major metropolitan areas, chambers of commerce have lists, though they are usually limited to chamber members.
Several different companies sell mailing lists. Usually the more detailed the information, the higher the cost.
However, the data may not always be up to date, so it's important to find out how often the list company gathers
and updates its own information.
The government also has lists, but they're usually quite old. Some of the list companies do
nothing more than resell the government's lists. Others will use a variety of resources to build more reliable
lists. A company can also use a variety of Internet search engines to find certain types of prospects. However,
these lists also tend to be outdated. By talking with other business owners, you can find which list services are
the most up-to-date.
The most reliable list will most likely be one the company builds itself after buying a mailing
list or constructing one itself, and then updating it with new information (and deleting bad information) as new
data becomes available.
If using information from the response card to generate sales leads, make sure to use that
information effectively. All pertinent information can be entered into a contact management program such as ACT!
Goldmine, etc. These programs can help the company and the salesperson track contact efforts and the progress of
the sales effort.
Calculate a return on investment for each direct mail effort. That helps determine not only
the effectiveness of the campaign, but also indicates where changes need to be made. If a mailer has a far lower
than expected return, it might indicate that that particular segment of the market needs a different message, or
isn't worth trying to attract at all.
In the same vein, a company can increase the effectiveness of its direct mail efforts by test
marketing one or more pieces with a small number of customers, compiling the results, and making adjustments, if
needed, before expanding the effort to the full market.
Frequency
Remember that marketing and sales is an ongoing process. So a one-time direct mail effort
probably isn't worth the money. So plan a direct mail campaign, which includes multiple pieces, rather than a
one-time mailer.
As a general rule, the more expensive the product, the more mailings that will be required to
produce sales. There are a few different reasons for this. Companies and individuals don't part with any money
lightly. For business-to-business communications, the more expensive the item, the more layers of management that
will probably be involved in the decision. It's also important that the right decision maker(s) at the company be
targeted. So it may be prudent to discover this prior to the mailing through telemarketing. This will also help
provide information you can use to scrub the database.
Remember that repetition is the key. Sometimes, no matter how well designed the mailer or the
message; the prospect just isn't in the mood to buy. However, he might be ready in a month or in two months. So
it's important to maintain a top of mind presence so the prospect contacts your company rather than your competitor.
For example, one of the nation's largest banks contacts checking account prospects every seven weeks via direct
mail because lifestyle changes (marriage, divorce, job change, etc.) occur often enough that people can change
their minds relatively quickly regarding where they want to bank.
Repetition also helps if you want to communicate a series of messages to hit different hot
buttons (i.e., price, quality, performance in three different messages).
Keep it Simple
Because prospects are busy, it's important that the message be communicated quickly, in just a
few words. People are time-pressed and don't have time to read through a lot of information before getting to the
message.
The message needs to be simple, and can change from one mailer to the next, but the mailer itself
needs to be consistent. Colors, styles and other "branding" elements should be similar. Five different mailers can
look very similar at first glance, but can be quite different by just changing a few simple words. If doing a
series of mailers, you may want to consider a succession of messages that bring the prospect from introduction to
the purchase decision.
By making the mailer odd-shaped or using teasers, the mailer will catch the prospect's eye
without immediately being labeled junk mail and thrown out before opening.
Follow-up
Once the prospect has shown interest, a good follow-up procedure is imperative.
The presence of e-mail and the World Wide Web has shortened prospect's expectations for time of
reply - even if the prospect himself took his time in responding to direct mail or another marketing effort.
Once a prospect has indicated interest, respond as quickly as possible. A warm lead can quickly
become a cold one if it takes too long to respond to his reply.
Timing
Forget mailers during the Christmas season, most potential customers are busy not only with the
holidays, but many are also starting to prepare year-end financial reports, etc., and will give little, if any,
thought to a direct mail piece. If a large percentage of businesses are incorporated, remember that corporate
taxes for annual corporate taxpayers are due March 15. Though this doesn't affect the purchase decisions at large
companies, at a small company, the business owner may be huddling with his accountant and bookkeeper (some of
which he may do himself) as tax time draws near. So there may be less time than normal to look at mail.
Beyond the seasonal issue of the holidays, the best time to mail and the frequency of mailing
depends largely on the product. If the campaign is tied to a particular event, or time of year, the mailings need
to start several months before the event or time of year itself.
A Word About E-Mail
One of the newest aspects coming into mail is direct e-mail. A little additional care is needed
when using this form of advertising, however. Remember, spam is spam. So e-mail sent "at random" can do more harm
than good. On the other hand, if prospects can "opt-in" to accepting e-mails via a referral card, telemarketing or
other means, this can be a way to get some additional responses without many additional costs. Several airlines,
for example, ask frequent flier customers to opt-in to get special rates. Direct e-mail is too new, however, for
any good, solid statistics to be derived about its effectiveness.
The effectiveness of any ISO's direct mail campaign depends on not only using the pertinent
advice above, but also on revising direct mail efforts depending on your individual company's results. You can
adjust almost anything until you find the message, frequency, style and target markets that work best for your
firm.
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