What is The Response Rate From Direct Mail Campaigns?

'What is the response rate from direct mail campaigns?' is undoubtedly the question our sales consultants are asked the most. Many factors influence your response, including your industry, target audience, budget, artwork, frequency, quantity, and so much more. In broad terms, it's a bit like asking, "how fast can a car go?". The car (Fiesta vs Ferrari), driver (my Mum vs The STIG), road (bumpy lane VS Le Mans), etc., all significantly impact the result! This blog aims to give an overview of what you should expect to receive from direct mail and how you can enhance your direct mail response rates.

Direct Mail Response Statistics

The DMA research shows a 9% average response rate for direct mail campaigns. In a recent JICMAIL report, "in Q2 of 2019...consumers engaged with 91% of all Direct Mail. By Q2 2020, this figure had soared to 96%." So contrary to some views, direct mail is increasing in effectiveness.

Further, the DMA reports as a direct result of receiving mail:

• • 92% have been driven to online or digital activity
  • 87% have been influenced to make online purchases
  • 86% have connected with a business online
  • 54% have engaged in social media
  • 43% have downloaded something
    

Therefore, not only does direct mail provide direct responses, it opens the door for further engagement online, which can lead to a conversion. This likely links to JICMAIL identifying that direct mail is one of the most effective ways to reach the Gen Z audience – "this audience is 40% more likely to claim that mail can change their mind about a brand than the average GB adult."

MarketReach reported that "Toyota leveraged mail's ability to create a buzz and drive traffic online when promoting its latest Corolla. Using mail, a microchip and a timer, Toyota created a race for recipients to view the car online as it was unveiled for the first time. Traffic to the Corolla website increased by 257%, resulting in a 900% increase in test drives and adding 8,000 people onto the waiting list."

Clearly then, not only is direct mail a very effective medium to build your business, it is one that is growing in effectiveness, particularly in the younger generation, and is excellent at driving traffic to your website resulting in paying customers.

Direct Mail Response VS Direct Mail Return

Often in marketing, we get obsessed with the response rate metric and overlook the conversion value - the overall return. Is it better to have a 10% response rate where the margin per new customer is £100, or to have a 5% response rate where the margin per new customer is £500?

The number of respondees for a FREE Beer direct mail (which I incidentally received just yesterday!) will have a greater response rate than my local BMW dealership direct mail offering three years of free servicing with a new car purchase. However, think how many beer subscriptions the company will need to break even from sending out so much free beer, never mind seeing a return. Yet, just one car purchase may provide a healthy ROI for the BMW dealership.

Therefore, I strongly recommend you don't use the above statistics as your only decision-making factor - instead, concentrate on potential conversion value and how to increase that conversion (which I will go on to discuss).

Best Industries for Direct Mail

Direct mail is often most common for business to business (B2B) marketing. However, some of our most successful and long-standing customers are B2C, including an estate agent and an education provider. Here are some sectors which particularly benefit from direct mail marketing:

• Car dealerships
• Education
• Council
• Estate & letting agents
• Hospitality
• Travel
• Home Improvement
• Retail
• B2B products or services

Do established brands achieve better results?

Sticking with the car dealership analogy - startup, 'Flow Cars' and the established dealership 'Stratstone BMW' both send out a 5k direct mail campaign. They send a letter and flyer to a data set of previous BMW owners local to their showroom, both offering a brand new 3 series 320i Msport for £399 deposit and £399 p/m for 36 months PCP (identical offers). From which garage would you buy? You would probably still buy from Stratstone even if their price was a little higher. Why? They have already built a trustworthy brand, which reduces risk in your mind. This is not to say direct mail is ineffective for startups; far from it! However, the drip effect marketing principle discussed below is even more essential for businesses yet to build a strong brand within their target audience's minds.

Direct Mail's Essential Strategy

The essential strategy for building your business is direct mail drip effect marketing. In this principle, you regularly repeat (drip-feed) your direct mail marketing to the same specific audience. This is proven to enhance your response rates and create a continuous flow of new prospects. To learn this strategy in detail, click here.

With pretty much anything worthwhile in life, by doing something regularly, your results compound. Going to the gym, eating healthily, pushing to convert a huge client, you arrive at positive results through consistent repetition. Marketing is just the same. People are much more likely to respond to your marketing when they keep seeing it.

"Advertising mail delivers increased customer value by increasing sales activity through long-term engagement." DMA

"Mail isn't a one-off thing in a box; it's about building connections over time." JICMAIL

"Your advertising mail (including leaflets, flyers and brochures) will deliver the best results if you design it with a big-picture view. Ensure that you map your customer journey out over a full year." DMA

Direct Mail Implementation

Plan your direct mail for the long term, stick at it and integrate it with your other marketing elements. By doing so, your business will see the results to take it to the next level.

At Flow, we have a team of experts who would love to help create and implement a business building direct mail campaign for you. We will, of course, recommend the drip marketing strategy - but also look at targeting, artwork, type of mailers, print, quantity, frequency, cost-effective options, and much more too.

Please do get in touch with us today, ask to speak with one of our sales consultants, and mention you have read this blog.