Against the backdrop of a slowing economy, there have been varying reports about companies reducing their direct marketing volume.But despite doom-and-gloom forecasts for declining mail due to recession, some companies are helping their clients to continue to make direct mail an effective way to market.
Much of the current growth in direct mail can be attributed to investments in new technologies and techniques that often are far more effective than traditional batch-based mailing, once a favored technique of industries that rely heavily on direct marketing.
These strategies include:
Campaign optimization strategies that reduce costs and waste while improving response rates. This is a new category of technology-driven services now emerging in the direct marketing industry. Campaign optimization programs provide a level of data hygiene that drastically reduces undeliverable-as-addressed mail. For example, a large telecommunications company recently applied campaign optimization technology to the company's annual circulation of more than 300 million. The company increased its reach of targeted recipients by 4 percent, moved its fully automated postal rate from 96 percent of the mailing to 99.7 percent, and eliminated mailed duplicates and undeliverable mail that comprised 1.2 percent of its file. Going forward, campaign optimization technologies and techniques will be critical to the direct marketing industry as we wage war on postal costs, create more effective programs by boosting response rates, and work together to eliminate wasteful mail.
The increasing use of sophisticated, quick-to-market, trigger-based mailings with reduced cycle times. Trigger mailings, with their emphasis on targeted, data-driven communications, generate significantly superior response rates as compared to traditional batch-based programs. Tests have shown that highly personalized, color trigger mailings can produce upwards of 5 to15 percent response rates, compared to the traditional direct mail channel where 1 to 3 percent is considered a good return. At Direct Group, we are increasingly seeing marketers take this personalization even further into multichannel messaging where the print message is followed up by message- and time-coordinated e-mail, collateral mail, telemarketing, or other contacts. This next-stage marketing strategy is helping drive significant growth in readership and response to our clients' direct marketing programs.
Advanced postal strategies that provide clients with savings in postage, combined with faster, more predictable in-home delivery dates. With postage often representing up to 65 percent of total direct mail project budgets, it is more critical than ever to partner with the USPS to cut cost-per-piece, increase speed-to-market, and enhance overall mailing campaign effectiveness.
Many clients make the mistake of continuing to regard postage as a "pass-through" cost over which they have little or no control. Furthermore, they fail to realize that it is possible to significantly reduce postage costs while still guaranteeing highly accurate and quick delivery of mail. New cost-saving production and mailing techniques available today include pre-sorting and commingling programs, as well as logistics strategies such as optimal packaging, targeted in-home delivery dates, load planning, reporting, co-palletization and standardized interfaces that determine the most efficient trucking and transport options. And, of course, this includes campaign optimization strategies as described above, which also help reduce postal costs significantly. The opportunity lies in carefully analyzing the goals and parameters of each effort and crafting a tailored strategy.
Digital printing technology.None of the techniques described here would be possible without the new digital printing technology that has emerged in recent years. The major printing companies today are continually setting new standards for high-speed, full-color, variable inkjet printing. These systems make it possible for marketers to execute robust marketing campaigns at reduced costs and increased speed and flexibility, using variable messaging, quality color, mixed forms, commingled data streams, and affordable short runs, all within the same workflow.
Despite any and all economic issues in the background, "reaching the right consumers at the right time with the right message" continues to be the ultimate goal for marketers. And with the advent of these innovative techniques and technologies, in many ways, it has never been more possible. Taken together, these developments are shaping the future of direct mail, where state-of-the art technology will continue to be applied to reduce costs, increase efficiencies, targeting and speed, and generate ROI for mailers.Even in a slower economy, direct mail continues to be a vibrant; remarkably effective element of the marketing mix.
About the Author: Pat O'Brien is Senior Vice President, Sales and Marketing at Direct Group.