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Posts Tagged ‘Direct Mail Marketing’

In the wake of the global economic slowdown, small businesses are faced with a big challenge: how to cost-effectively build their business with an extremely limited budget. Many of these businesses should consider a “DIY” (do it yourself) direct mail campaign.

Sometimes small businesses balk at the idea of spending money on a mailing list, especially when they are unfamiliar with direct mail marketing. Hopefully this article will shed some light on how easy and cost-effective it can actually be.

Get a 10% – 20% Response Rate on a 500 Piece Mailing For Under $400

Challenge: How can a small business owner on a limited budget use direct mail to cost-effectively market their business? Secondarily, how can a small business increase their odds of obtaining a meaningful return on their investment?

Background: Most small businesses lack the funds to do a large-scale direct mail campaign. Even a mailing of just 5,000 pieces can cost upwards of $2,500 for a simple postcard. Add another $1,000, or more, if you want to send something in an envelope via First Class Mail. Many companies offer small direct mail campaigns (called “short run” in printing vernacular) however the unit costs on these small campaigns can be as high as $2 per mailed item.

Solution: Create the mailing in-house and break the mailing up into smaller, manageable pieces.

Handwritten envelopes have been proven to increase response rates by upwards of 500%. Add a First Class stamp and a local return address and some businesses see a 1,000% increase versus machine-created bulk mail.

Many small businesses obtain a 10% – 20% response rate when using this method of direct mail marketing. That’s 50 to 100 new potential customers obtained from sending just 500 mail pieces.

Creating a Cost-Effective DIY Direct Mail Campaign is Easy

1. Work with a mailing list company that offers low minimums on smaller mailing lists. Look for a $50 minimum which can get you up to 1,500 names depending on the list. A New Movers list will allow you to target new people to your area who probably aren’t familiar with your business.
2. Create your marketing materials in-house or use a freelance designer to do a quick and easy design. Many freelancers will have direct mail templates to which they simply add your copy, contact information, etc.
3. Use your own color printer to print your marketing materials or find a printer who specializes in combining (“ganging”) multiple small print jobs into a single, larger job for cost efficiency.
4. Buy closed-faced envelopes and a roll of self-stick “Forever” stamps that are good for life even if postage increases before you use them all.
5. Buy an address “stamper” with your business name and return address to use on the envelopes.
6. Hand address the envelopes, stamp the envelope and insert your marketing materials.
7. Send out as many or as few per week as you like.

Do the Math

 
With less than $400 you’ll be on your way to generating sales leads for your small business!

Direct Mail Forecast

CHARLOTTESVILLE, VA – A comprehensive forecast of the use of digital printing in the direct mail market has been undertaken and published by INTERQUEST, a market research and consulting firm that serves the digital printing and publishing industry. The document is entitled Digital Printing in Direct Mail: Market Analysis & Forecast (2008-2013) – 260 pages.

The study contains 155 tables and charts and also provides an assessment of the impact of the financial crisis on the direct mail printing business. It was published in January 2009 and complements a previous study from June, 2008 entitled North American Transactional Printing: Market Analysis & Forecast.

This new study is based on in-depth surveys of 40 leading North American direct mail printers and large mailers. The collective volume of the survey participants interviewed for the report account for about 20% of the total digital direct mail impressions produced in North America.

INTERQUEST President, Gilles Biscos, pointed out that direct mail printing has generally been a bright spot in the printing industry for a some years, now. He has seen some dramatic advancements in recent years – the latest generation of equipment in particular – so he and his company felt that the time was right to take a serious look at how digital printing technology was being used in direct mail.

The study is aimed at industry professionals involved in sales and marketing, product management, engineering and product development, application and technical support, market research and strategic planning, sales and technical training, selection and purchase of printing solutions and printing and publishing operations.

Among the topics undertaken in the study are:

• The state of the direct mail market – both current and future
• The use of digital printing in direct mail – including technologies and applications for black-and-white and color
• Important business issues to consider – such as postage, the environment and legislative matters
• The use of laser and ink jet printing in direct mail
• The impact of promotional transactional applications on direct mail inserts
• The impact on direct mail by the current financial downturn

Business who use marketing lists for their direct mail campaigns will certainly be affected by the conclusions arrived by this new study. The study findings suggest that digital providers should be in a stronger position than non-digital providers and should stand a much better chance to weather the current economic downturn. Providers of direct mail lists who use the new digital printing technology will be on the bleeding edge.

How do you take advantage of mailing lists to expand your business? Taking advantage of  buy mailing lists is one of the most effective ways to increase sales. You should be using your customer list as well as purchased mailing lists from a list broker. But even the best efforts to increase sales by using a mailing list can require very careful analysis and record keeping. In the previous article we discussed using your invoice and expenses ledgers as marketing tools to analyze your marketing efforts. In this article we will discuss the invoice ledger in more detail.

Does Your Business Keep An Invoice Ledger?

Every business should have an invoice ledger. If you have carefully kept track of the lead sources from your various marketing campaigns, then you will be able to identify the most profitable and productive sources of advertising. You can tell a great deal about the workability of your promotions and marketing by doing this very simple analysis. This example uses lead categories for repeat sales plus new sales from trade shows, direct mail, referrals, field sales, phone sales, ad sales and sales from new businesses (plus unidentified new sales). Simply prepare a spreadsheet and tabulate your sales invoices for a given period of time into the various lead categories:

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Next, tabulate the sales from the same period into the number of sales invoices. The number of sales invoices will be needed to calculate the average sales for the various lead categories:

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Next, you can summarize the data:

Graph Your Results

Finally, you can graph the results. You will be able tell at a glance which promotional activities are producing the most. The following graph shows the volume of sales for repeat customers vs. new customers and how the new customers break down into the various lead categories:

Repeat Customer Sales vs. New Customer Sales

In this example only 12.33% of the total sales volume is for repeat customers. This looks like a business that constantly must go after new customers because it has to make 87.67% of its income from new customers. This is a perfect example of why the business must analyze very carefully where to put its promotion and marketing efforts because getting new customers requires a lot of advertising and marketing. This example is very typical of a business that uses a variety of advertising sources to generate sales leads. In fact, it makes about 24 cents out of every dollar from phone sales and about 23 cents out of every dollar from field sales.

Referral Sales

Notice that one of the categories is referral sales. One of the most important ways a business can make income is from referral sales. There is no better advertising than word of mouth. In this example, about one out of every five dollars of revenue comes from referral sales. This means that the business must make up the remaining revenue from contact other than from existing customers. That involves the effective use of advertising and promotions.

A Typical Business Can Benefit From Direct Mail Marketing

This example also illustrates that sales revenue from direct mail campaigns amounts to one dollar out of every ten dollars – not bad considering that this is a typical “brick and mortar” business. In other words it is not what you would call a direct mail business because it does phone calls, field calls and trade shows, but it does make a little over 10% of its income from new customers from direct mail marketing. How would you like to make another 10% in sales revenue? You should be using direct mail marketing in addition to your other promotion and advertising efforts.

Mailing Lists Direct is a full service direct mail list company where you can find consumer mailing lists, business lists and specialty lists at competitive prices. Mailing Lists Direct provides first rate customer support. No matter what your business needs in the way of an address list or managing your mailing list campaigns, Mailing Lists Direct will be able to satisfy all your needs. Call toll free at 800-741-0116.

Mike Doughty is a small business owner and entrepreneur with a background in direct mail marketing, manufacturing and distributon. During his career, he produced a mail order catalog and worked on many successful direct mail campaigns.

Mailing Lists

Many businesses can increase sales and improve their bottom line by using direct mail. Sending out periodic direct response mailings will create inquiries that salespeople can convert to new sales and new customers. Doing so requires the use of quality mailing lists.

A small startup may be able to do it from their kitchen table, but most businesses – whether small, medium or large – will require a mailing list service to supply the names and addresses, print the mailing pieces, prepare the mailing labels or print the names on the mailing pieces, prepare the postal barcodes and sort, bundle and deliver the mailing pieces to the Post Office. These are a lot of steps but are only the ones needed to get the direct mail pieces into the mail.

There are also some follow up and maintenance steps to do if you want to get more mileage out of the address list. Someone needs to clean the list (remove the duds and make address corrections to the good names), make selections for future mailings and merge your in-house names (your own customers and prospects) with the purchased mailing list to remove duplicates.

More Than a List Broker

A full service mailing list company is more than a list broker. Although finding the right list broker is vital to the success of your mailing list venture, as you can see there is a lot more to managing a successful, ongoing direct mail list campaign. Just consider these facts:

• How are the names going to be affixed to the mailing piece? Are you going to use mailing labels or will they be printed on the piece?
• Who is going to design the piece? Does the designer understand the necessary postal regulations? The dimensions have to be right. The location of the mailing labels, indicia and other markings have to be right. On a folded piece is the fold supposed to be on the left or the right in order to be run through the postal equipment? If they mess this up you may have to pay surcharges because the piece doesn’t conform. Worse yet, the piece might not qualify at all. Then your whole printing job is down the drain.
• If the mailing piece consists of separate parts – an offer letter, coupon, return envelope, brochure, etc. does the designer know how to assemble all the pieces in the right order? Are the pieces laid out properly to be assembled by machine? If this isn’t done right you might be stuck with a lot of manual assembly or a poor response rate. Design errors can cost you big time.
• Do you have a mailing permit or are you going to use the mailing house’s permit?
• How are you going to handle address corrections? Are you going to clean the list in-house or use a mailing service or are you simply going to skip it altogether?
• How are you going to make the selections from your in-house customer list? How often do you mail to them? What if you are doing a monthly mailing? Do you send the mailing to all the customers every mailing or do you prioritize the names? For example, do you mail more often to customers who have purchased something recently? Do you mail less often to customers who have not purchased in awhile? What are the rules? How do you make the selects?
• Who is going to do a merge-purge of your in-house names with the mailing list? Are you going to attempt to do this yourself? How can you find and remove duplicates?
• Who is going to print the piece?
• Who is going to sort, bundle and deliver the mailing to the Post Office?

Mailing Lists Direct is a full service direct mail list company where you can find consumer lists, business lists and specialty lists at competitive prices. Mailing Lists Direct provides first rate customer support. No matter what your business needs in the way of an address list or managing your mailing list campaigns, Mailing Lists Direct will be able to satisfy all your needs. Call toll free at 800-741-0116.

Mike Doughty is a small business owner and entrepreneur with a background in direct mail marketing, manufacturing and distributon. During his career, he produced a mail order catalog and worked on many successful direct mail campaigns.

Welcome to the Marketing News Roundup blog. Here you will find marketing news and information on direct mail marketing.