Writer and marketer Jenni O’Connor of Kaiku Communications asks if, in today’s economic climate, direct marketing is best.
Traditionally, companies have considered advertising as their obvious marketing choice. Not necessarily as a stand-alone strategy, but up there and linked, perhaps, to the ‘P’s’: a PR campaign, poster advertising, and, if they are retailers, a price promotion at the checkout.
But that’s all changing. With ever-diversifying outlets for advertising (be it digital radio channels, cable or satellite TV, and new magazines cropping up to satisfy every niche demand, advertising is reaching fewer and fewer targets. It’s also expensive – though prices are falling rapidly – and, crucially, offers little direct feedback on response.
By contrast, more and more small firms are considering direct marketing – be it via email, text message, phone or even good old-fashioned snail-mail. Indeed, the proliferating channels for contacting consumers directly is one of the reasons for its success, along with the possibilities offered now for ‘mass-customisation’ – the use of EPOS and other data to not only personalise an email or letter with your name, but to bring in very specific information which is likely to trigger a reaction, in the same way that loyalty card updates make offers based on your known buying habits, and when you log on to Amazon they are full of helpful ‘suggestions’.
It’s not all junk mail
Despite most consumers’ professed hatred of unsolicited ‘junk’ mail, the main – indeed only – reason that companies run direct marketing campaigns is that they work. Response rates will vary according to the product, method, quality of the data and quality of the offering; a highly targeted, well-written campaign to specific known recipients may score as high as 10 per cent, while the average is 2.61 per cent, and poorly-targeted mailings with no real offer or incentive will come in at under 1 per cent. But 1 per cent of 10,000 is still quite a lot.
A recent study by Directmag.com showed the following response rates: 5.35 per cent for not-for-profit fundraisers, 3.36 per cent among retailers, 3.34 per cent for B2B service providers, 3.17 per cent to manufacturers, 3.07 per cent on repair services and 2.98 per cent for travel offerings. At the bottom of the list, perhaps because we are all saturated, came computer and electronic goods at under 2 per cent.
Converting interest to a sale
Once a message has been opened and read, and not thrown out for recycling (physical or otherwise), the company behind the promotion has a chance of converting interest to a sale. Real persistence is often needed to arrive at that sale – this has been defined as ‘multiple touches (ie contact opportunities), multiple channels (ie cross-medium contact), and multiple cycles (if at first you don’t succeed…)
But in the first instance, the contact has to have the right message, the right tone, the right offer, and ideally come at the right time. One of the best pieces of advice I’ve come across in terms of direct marketing is the need to ‘reach out and feel their pain’. In other words, the marketer’s subject line (or heading, or opening gambit in a phone call) needs to capture the recipient’s imagination and touch on a problem you know they need to solve, so they won’t immediately hang up, discard, or press ‘delete’. After this, the core message needs to reinforce that the firm contacting you really does have a viable solution to the problem, which is conveyed with authority, and finally any direct marketing message needs to close with a call to action, such a promotional offer with a short shelf life.
This is where expert copywriting comes into its own. It is well known that direct mail written by non-professionals gets a far lower response rate, while a small tweak to a headline can make an infinite difference to perception.
Pay less for higher return on investment
The other factor which makes direct mail so appealing in straightened times is the opportunity for direct feedback. As responses come in, a company can not only log and respond to leads, but also evaluate the campaign’s success compared to previous ones, or make comparisons between data groups and market segments. Direct marketing can not only be very finely tuned, with an array of offerings for different user groups, but then following the responses, the data can be further segmented, with each contact leading to a greater understanding of the potential lead’s interests and requirements.
Finally, as I touched on in the beginning, it’s cheap. Direct mail companies often provide a monthly email service for as little as £250, and if you’re selling, for example, an expensive IT system, then just one sale will massively outweigh your output.
So, all in all, it pays to think direct.