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Direct Mail

Direct Mail. MKT 3850 Dr. Don Roy. Direct Marketing Defined. “Any direct communication to a consumer or business

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Direct Mail

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  1. Direct Mail MKT 3850 Dr. Don Roy

  2. Direct Marketing Defined “Any direct communication to a consumer or business recipient that is designed to generate a response in the form of an order (direct order), a request for further information (lead generation), and/or a visit to a store or other place of business for purchase of a specific product(s) or service(s) (traffic generation).” - Direct Marketing Association

  3. Key Features of Direct Marketing • Interactive • Uses one or more advertising media • Measurable response from audience • The development of customer databases is instrumental in making direct marketing possible; it allows for precise segmentation and targeting of customers

  4. Direct Marketing Campaign Components • Audience Selection – Who should receive your message • Creative – What your message will say and how it will look • Offer – What is the incentive for the audience to give the desired response (e.g., discount, free gift, etc.)

  5. Recipe for Direct Marketing Success • 50% - Audience Selection • 30% - Offer • 20% - Creative Source: Steve Collins, “Proper Testing is Central to DM Success” Marketing News, November 1, 2004, 19-20.

  6. Audience Selectivity- Select recipients based on desired characteristics Flexibility- Options for varying lengths and formats (letter vs. postcard) Impact- creative options such as colored envelopes, “personalized” appearance, and teaser slogans gain attention Response- Provides means for measurable response (e.g., a coupon) Direct Mail Strengths

  7. Direct Mail Weaknesses • Delays in delivery - Postal Service can “drop the ball” and miss intended delivery date • Low response rate - Where do you place most direct mail pieces you receive? • High cost per response • List quality assurance - List data that is not current hurts response and creates waste • Saturation among audience (i.e., clutter)

  8. Measuring Direct Mail Results • Response Rate - What % of customers contacted gave feedback (i.e., responded) to our message to them? # of Responses Response Rate = # of Contacts Made Example: Direct mail campaign in which 500,000 pieces were mailed and 50,000 people responded: 50,000/500,000 = .10 = 10% Response Rate

  9. Measuring Direct Mail Results (cont’d) • Cost per Response - How much does it cost for each customer who gives the desired feedback? Total Costs of Campaign Cost per Response = # of Responses Generated Example: A direct mail campaign with total costs of $500,000 (including printing, postage, ad agency fees, etc.) and resulted in 2,500 sales: $500,000/2,500 = $200 per sale

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