Reducing costs with better marketing communications management | DMA

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Reducing costs with better marketing communications management

For any business, managing costs is a vital aspect of day-to-day life. Indeed, it can often be difficult to stick to budgets, which means outgoings can soon spiral out of control. It’s therefore imperative that businesses look at ways of economising wherever possible, and one of the best places to start is the marketing department.

An area that is often overlooked, but can provide very real cost savings if managed effectively, is communication. The proliferation of communication channels may be seen as daunting and complex to businesses, however those that make the necessary investment will not only be in a better position to meet the demands of customers, they will also be able to cut total expenditure on customer communications. For example, using email instead of post when sending certain marketing material, or scanning incoming mail to reduce the amount of space taken up by filing cabinets. Managing the delivery of physical and digital marketing mail as part of a unified workflow can overcome many of the practical difficulties associated with a multi-channel marketing strategy, enabling businesses to cut costs through digital substitution.

Reducing storage and inventory costs

An important aspect of any customer communications strategy is a consideration of the storage and inventory costs of the marketing collateral the business sends – envelopes, letterhead, documents, forms, brochures, etc. Digital substitution will reduce many hard copy costs; however no marketing teams can eliminate physical mailings in their entirety – and in an age of customer-driven multi-channel communications, few would want to.

If you look around any office, you will see cupboards and filing cabinets full of stationery, pre-printed forms and brochures. There is a tendency to view inventory as an unavoidable cost of doing business, but it is no longer necessary to tie up money in documents that could become out-of-date before they are used. By using print management solutions, start-ups can create and use electronic templates that remove the need for pre-printed forms. Furthermore, on-demand digital printing technology reduces, and in some cases removes, the need to hold any pre-printed documents.

Reducing stocks of pre-printed stationery and marketing material also frees up storage space. Addressing how you receive customer communications, in particular in-bound mail, can subsequently have an impact on the size of the office required. Indeed, instead of opening the post and distributing the physical contents, businesses could scan mail at point-of-entry and route files electronically. This has many benefits, including a significant reduction in local file storage. According to AIIM's Paper Wars 2014 survey, the amount of office space taken up by filing currently averages 13.5 percent. When you consider how high annual UK office costs are, the financial case for implementing a digital communication strategy becomes clear.

Addressing addresses

Another hidden cost of communications is money wasted on unnecessary, mis-directed, duplicated or badly planned marketing communications. With the cost of producing and sending a document in the region of 35p-65p for the largest mailers – and even more for small businesses – working out when and how each customer prefers to be contacted and switching them to digital content where appropriate could lead to big savings.

Sending documents with incomplete, inaccurate, out-of-date or duplicated addresses can also result in wasting money unnecessarily. There’s the possibility of disqualification from Royal Mail postal discounts, damage to your business's reputation, and the creation of extra work for staff who have to deal with customer complaints or process returned mail. Worryingly, studies have suggested that up to 25 percent of address data held by small businesses is inaccurate or wrong. By implementing tools that validates addresses and ensures contact details are up-to-date, businesses sending out large amounts of marketing material can save money on a regular basis, which all adds up.

Another big communication challenge faced by businesses is the risk of human error. Indeed, many organisations still rely on manual processing, which can add significantly to the total cost of communications. Any process that is done by hand, such as the sorting and delivery of marketing letters or brochures – can be improved through automation. As well as improving productivity within the marketing department, automation can help save money by reducing labour costs and minimising the risk of errors and lost items.

A successful marketing communications strategy will not only reduce communications costs; it can also help a business improve its cash-flow through reduced labour costs, faster business processes and payment for postage in arrears. Furthermore, for maximum impact, businesses need to increasingly take into account how a customer wants to be contacted. Ultimately, some businesses may be reluctant to invest in tools that optimise their communication strategy due to perceived high costs and complexity, but by automatically relying on manual processes, they are overlooking a number of opportunities to gain new customers and reduce costs.

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