PART ONE: RETURN ON INVESTMENT (ROI)
“Stop worrying about the cost and start worrying about the return!”
With USPS prices going up in April (April 17th) ( see http://www.usps.com/prices/pricechanges.htm ), NOW is a great time to get a grip on your mailing returns. First of all, a few guidelines and truths:
1) Is 1% good enough for you? As a general rule, the BEST response you can expect from a “saturation mailing” is about 1.5%. That means that if you hit a zip code or population demographic with a standard mail drop, even if it has a correct name on the mailing panel, you will probably do no better than a 1.5% return.
2) 7% and beyond. As a general rule, a CONSERVATIVE response from a “variable data” mailing is at least 7%. That means that if you hit YOUR database of customers and prospects with a variable data drop you will probably get at least a 7% return. We have seen this number actually go over 35%. Note that these variable data elements must go beyond the variable data represented on the mailing panel.
3) The cost of the postage is NOT your biggest investment! You should plan on investing a LOT of resources into PLANNING and into a great design…a design that is a part of a larger marketing campaign and includes multiple exposures to the main theme of the program (blog, email blasts, direct mail…even voice mail!).
4) POST CARDS work wonders. Here is why: They are the least expensive direct mail piece to produce and mail AND, even if your prospect/client throws the piece in the recycle bin, they absolutely MUST first give it a two second glance in order to decide if they are going to keep it. That glance shows off your brand and name. That keeps your brand and your name in front of the prospect/client. Of course more dramatic options are available with folds and envelopes…everything depends on your message and product needs. But don’t discount the value of a simple post card!
5) Green thoughts. For those concerned about environmental issues, “junk mail” is paper and paper (and printing) has many sustainable benefits. Too many to go into here. Forget the myth about being green because “we post our newsletter online and are saving the environment”. That has been proven to be false many, many times over.
OK..now let’s examine some numbers.
Over the past several years we have seen a dramatic shift in the types of mail pieces that are printed. It used to be our only option for direct mail was a saturation mailing. In fact, in some cases, this is still a good option, particularly when you HAVE to mail to every address in a zip code range or when you are fishing for new leads.
But these days we have access to new and powerful print options that print in true (high quality) offset technology with stunning variable data abilities. These variable pieces can include much more than just name/address/zip and, if your data supports it, allows you to get higher and higher returns.
Considering you have a data base that has more than the few standard data elements , using them in a variable data mailer could yield these sorts of results (click on the image to enlarge or EMAIL ME at DRickman@ColoradoPrinting.com and I will send you this spreadsheet!):
Using this model, let’s imagine you would like to have 200 – 250 responses to your mailing. The RED circle shows a typical response based on a saturation mailing. So, all things being “normal” you would have to print and post 10,000 pieces to cultivate about 200 responses. This will cost you about $18.60 per response. The GREEN circle shows a very conservative response on a very basic variable data mailing. For an investment of about 1/3 of what you spent on the saturation mailing, you should be able to get about the same amount of responses at around $5.50 per response. For added insurance, why not send the variable data project out twice…the first a month before the event and the other about a week before the event. You are still spending a lot less money and will practically guarantee a response of 200. If you are careful with your design and CONSERVATIVE with your campaign, go ahead and send it out a third time. Now your results will likely go a lit higher and you STILL have not spent the total amount you spent on the saturation mailing (!). In fact, you will have enough left over to hire someone to hit this entire target audience with a very effective email campaign!
Please note that, to get these sorts of results, you MUST have clean and “deep” data. For instance, if you are a car dealer and know your data base can include the type of car your client owns, you can begin to design a much more effective variable data piece…one that includes the actual make and model of their vehicle, photos of their vehicles…even the colors they like can be included in the background, etc. But this all needs to be thought out ahead of time and that data needs to be accounted for and properly formatted. A few extra weeks of planning and effort goes into these sorts of results but it is well worth it when you start seeing these amazing results.
The next issue will discuss the actual data. Where to get it, how to keep it organized, how to make it work for you!