Archive for October, 2007

How Marketers are Sabotaging Direct Mail Marketing Programs

I think we can all agree that a direct mail marketing program is only successful when it provides an increase in ROI. Then wouldn’t it surprise you to learn that many companies don’t measure the success of their marketing campaigns?

According to Nancy Arter, in a blog post entitled “Measuring and Tracking Your Marketing Effectiveness,” studies have shown that many companies don’t have the ability to track the redemption rates for their marketing campaigns. Instead of testing a few different campaigns before selecting one that works, “marketers simply move on to the next campaign without fully understanding what occurred in the last one.”

Along with being a waste of time, jumping from one marketing campaign to the next without learning anything is a good way to sabotage your marketing efforts. “Without some way to track the effectiveness of your marketing programs you are doomed to failure. Some time or another, you are going to be asked about the dollars that you are spending on your campaigns, how what you are doing is increasing sales or bottom-line profitability, or some such question. If you can’t provide proof of the success that you are creating through your marketing programs, management scrutiny will increase, your budget will be cut or worse.”

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Direct Mail Marketing Programs Can Increase ROI for all Types of Businesses

In a blog post on Pro2.ru entitled, “There’s More to Marketing ROI (return on investment) Than Meets the Eye,” Joy Gendusa says that many people mistakenly measure ROI by the number of responses they receive after sending out bulk mailings, instead of by the amount of money the direct mailings return. For example, if you spend $5,000 to send out 10,000 direct mailings and you only receive 15 responses, it may not look like very much, but if out of those 20 responses you make $15,000, it’s clear that you have a successful marketing strategy.

According to the article, the marketing strategy used in direct mailings can work for any kind of businesses. “Results of direct mail marketing vary from business to business but the principle holds and always works: if you send out enough promotion, you will make sales and maximize your marketing ROI.” The CFO of a consulting company is used as an example of this point. According to him, “the money we have put into the postcards is like a drop in a bucket compared to what we get back.”

Whether you’re a Fortune 500 company or small business, direct mail marketing programs can help you increase your sales and profits. The more direct mailings you send out the higher your ROI will be.

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Why are Card Mailers So Effective When Used in Conjunction with a Direct Mail Piece?

Many direct mail marketing programs are replacing oversized postcards with card mailers. Since card mailers provide a lower cost-per-lead it seems obvious why companies are making the switch, but what is it about card mailers that allows them to increase redemption rates?

In an article by Deloitte & Touche USA LLP entitled, “How Gift Card Service Can Help You,” the success of card mailers is attributed to their ability to result in an impulse buy. Not only do customers use the gift cards that they receive, they usually end up spending more than the card is worth. Along with increasing profits, according to the article, gift cards or card mailers encourage customers to return. If a card has a remaining balance, the customer will return because the money can only be used at that store.

Unlike oversized postcards, card mailers can easily fit into any wallet, much like a credit card. Each time the wallet is opened, the card acts as an advertisement for the product or service. Even if just a few dollars remain on the card, if it goes unused, the customer feels as though they are throwing away money.

Each of these examples helps explain why card mailers are able to provide more ROI than oversized postcards. Though they may cost more upfront, they make up for it in redemption rates.

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Replacing Oversized Postcards with Card Mailers is One More Way to Increase Direct Mail Marketing Response

The main goal of any direct mail marketing program is to increase redemption rates. In a blogpost by Rubber Bondage, 101 ways to improve your direct mail marketing response are listed. Increasing your mail frequency, including multiple offers with each mailing and including testimonials are some of the strategies discussed. Surprisingly though, there is no mention of the confirmed benefits the use of a discount card in combination with a direct mail piece can provide. While layout of the envelope and the wording of the message are extremely important when attempting to gain a potential customer’s attention, convincing them to act on your offer is what really counts.

Frequently, when a direct mail piece is found among mail, it is immediately labeled as “junk mail” and therefore treated as such, meaning it usually ends up in the trash. This has definitely been found to be true when the direct mail piece is in the form of an oversized postcard. But many retailers have found that redemption rates increase when the postcard is replaced with a card mailer.

Many people tend to focus on the cost of a direct mail piece when the real issue they should be concerned with is the cost-per-lead. Although card mailers may be more expensive than oversized postcards, because of the increased number of redemption rates, they end up being the lower cost-per-lead.

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