Direct Marketing 101
Reach Your Audience - Directly
John Wanamaker, the legendary merchant, famously said: "Half the money I spend on advertising is wasted; the trouble is I don't know which half." He expressed the frustration of any business and its advertising budget. You know that you have to advertise but calculating the results is difficult. A newspaper display ad campaign, for example, may result in sales in excess of the amount spent, but how do you know that an order came from an ad, unless it's accompanied by a coupon or a "special offer code."
Direct marketing, on the other hand is different. Direct marketing means targeting a message to a select group of potential customers whose characteristics you have determined in advance. You can tell with precision how your campaign performed. It should be a part of your business plan
General Considerations for Direct Marketing
· It can be expensive, especially if you use direct mail.
· Because of its cost, you should only sell items or services that have a reasonably high price tag. Selling a book from which you may make a royalty of five dollars may not be a good idea. You have to sell a lot of books just to cover the cost of your direct mail campaign.
· A direct marketing campaign takes a lot of research and planning. If you don't do your homework you can lose money in large amounts and fast.
· Post campaign analysis is essential. The mail machine giant Pitney Bowes did a survey entitled 2012 Small Business Marketing Survey They found that only 20 percent of mailers studied their results! Can you spell dumb?
· Direct marketing is predictable. Once you have accumulated statistics from a few campaigns, you can determine your costs and profits in advance. When I owned my publishing company we relied heavily on direct mail. I could count on a subscription response rate of .03 percent for a direct mailing. That may sound small, but because we charged $300 for a subscription, this translated into a steady stream of predictable income. And, because we had a renewal rate of over 90 percent, any campaign kept yielding fruit long after it was done.
Direct Mail Compared to Direct Email - The Pros and Cons
Direct Email - The Pros
· Email is much cheaper than regular mail. An email list in the millions can cost a pittance compared with the cost of the post office, even bulk mail. Your major costs will be in the design of the campaign and fees to the company you choose to do the work.
· Email is fast. Your message is broadcast across the Internet in seconds. The speed of your message also means that your campaign analysis is faster. There is little lag time between a person viewing a message and a click.
· Email can result in immediate action, which translates into immediate cash flow.
· A new industry has sprouted up around email direct marketing, with Constant Contact as the leader. You don't have to second guess what you're doing, you have the support of a marketing giant at a reasonable price.
· People have grown accustomed to email messages and some even prefer to receive sales information on their computer screen. Caution, this is a double edged sword, as I will cover under the cons of email. Email has rules, formal and informal. Follow them.
· Social media. Email campaigns can be blended perfectly with social media announcements.
Direct Email - The Cons
· People are bombarded with email. This is the flip side of the argument that people are growing accustomed to it.
· Spam. The modern scourge of spam, as we all know, is loosely defined as email blasting of unwanted advertising. Of course you don't know if you don't want it until you see it. Spam has given marketers a growing black eye. There is a guerrilla war taking place between aggressive marketers (spammers) and software apps and programs that combat spam. Mother Google has gotten into the act and is constantly tweaking its algorithm to combat spam.
· Clutter. Because of the exponential rise of email messages, you have to be very creative in your title box to create a message that will grab someone's attention.
Direct Mail (Snail mail)
Reports of the death of regular direct mail is greatly exaggerated, and the cash strapped US Post Office hopes that this is true. In 1980 29 percent of all mail in the United States was standard advertising mail.The statistics are telling. By 203 the number had grown to 43 percent. According to a 2012 survey 65 percent of people who receive a direct mail promotion have made a purchase. this is second only to email (66 percent.) So direct mail advertising is alive and well.
Direct Mail - The Pros
· It works, as mentioned in the paragraph above. If 65 percent of a targeted audience buys, this is a marketing tool that you can't do without.
· The graphics. If you see something in a title box that doesn't interest you, click and delete. With direct mail, you can, of course, throw the ad into the trash basket, but your eyes first have to see the promotion. In the hands of a savvy graphic artist a photo or design on a direct mail piece can be compelling.
· You reach the market that isn't computer savvy. Yes, this is a shrinking group, but they are out there.
Direct Mail - The Cons
· It is very expensive. Even if you're using discounted bulk mail, your cost per message can be astronomical compared to email.
· Natural disasters can mean a natural disaster for a direct mail campaign. I would shudder at the thought of having sent a direct mailing on the day of Hurricane Sandy.
· If time is a factor, direct mail runs a second choice to email. It takes days for a piece to hit its target audience rather than seconds. Because you are always testing the results of a direct mail campaign, days and weeks translate into delayed knowledge.
Coupons and Promo Codes
People love to get something at a discount. Using coupons or simple promotional codes is a great way to enhance a direct marketing campaign, whether email or traditional direct mail. Try to remember the last time you received a direct marketing message that didn't offer you something special in exchange for "act now."
Direct marketing, whether by email or traditional direct mail should be part of the marketing plan for any serious business. Although the cash outlay may be higher than display advertising, the results can be tabulated with scientific precision.
Copyright © 2012 by Russell F. Moran