Direct Mail: “Still Among the Best Media to Drive Response”
By Heidi Tolliver-Walker on July 6th, 2012
In a world enamored with digital media, the Direct Marketing Association’s data goes against the grain.
Even though direct mail is less effective in driving response than it was a decade ago, it still is among the best media for generating overall response.
These are the words of Yory Wurmser, DMA’s director of marketing and media insights. He is referencing the DMA’s 2012 Response Rate Report, which continues to show direct mail for market powerhouse that it is.
According to the 2012 edition, which now includes email, display ads, and paid search, as well as history trends, direct mail response rates have dropped nearly 25% over the past nine years. Even so, mail campaigns draw a better overall response than digital channels.
|House List||Prospect or Total|
Source: Direct Marketing Association 2012 “Response Rate Report”
While direct mail was remains a powerful tool in the marketing arsenal, email is cheap. Perhaps then it shouldn’t be surprising that the DMA report shows its ROI to be substantially higher (28.5 vs. 7.0).
What we don’t know, however, is whether there is really a direct comparison. For example, ROI on direct mail might be lower overall, but if you use them in entirely different markets (selling automobiles vs. Canadian pharmaceuticals), the comparison is completely irrelevant.
Other findings of the report:
- Transactional data show that only 6% of the actions following an online display advertisement occur immediately following a click, which indicates that click-through rate greatly underestimates the impact of online display.
- Transactional data show that financial services emails had open rates above 30%, which ranked the highest among industries. Retail (apparel) had open rates averaging 14.7%, which narrowly was lower than Publishing & Media (14.9%). In contrast, data showed Publishing & Media as having the highest action rates per impression (0.013%).
- For emails, the highest click rate to open rate is for CPG (46.5%).
- Cost per order or lead for acquisition campaigns were roughly equivalent for direct mail ($51.40), post card ($54.10), email ($55.24), and paid search ($52.58).
- Email performance went up slightly from the 2010 Edition of the Response Rate Report.
- The highest response rates—nearly 13% to a house list—was produced by telephone marketing.
- Telephone marketing also had the highest costs: nearly $78 per order or lead for a house list, and $190 for a prospect list.
- Costs were generally higher for B-to-B campaigns than for B-to-C campaigns.
DMA’s Response Rate Report was conducted through a survey that was emailed in April 2012. When the survey was closed, DMA had received 481 usable responses.