Direct Marketing CampaignThe final marketing strategy for promoting your business and including in your business plan is referred to as Direct Mail, or Direct Marketing. For years this strategy has proven to be extremely effective for many businesses. However, some companies will argue that it is a waste of money, and shouldn’t be done. As long as you have researched your customer and target audience, and know what it is they want and are looking for, then this marketing strategy should be included in your business plan and used when promoting your business.

This strategy is a complex one, due to the many ways that it can be used, and the issues that you need to be aware of. Direct marketing is NOT sales promotions or advertising. They are tools that are addressed to a specific customer or target audience, outlining a particular issue or product that you think will solve one of their needs.

It also needs to be mentioned that direct marketing can be expensive. There are a number of ways that it can be done, but the response rate is small. As a matter of fact, if you receive a 1-2% response rate on your direct marketing campaign, then you are doing very well. Anything less than 0.5% is a poor result, and anything more than 2% is a great result. Most businesses that implement this strategy will have very similar figures, and these results have been proven time and time again. So, for a mailing of 100,000, a response rate of 2,000 would be excellent.

Why such a small figure?

If you consider the quantity and quality of some direct marketing pieces that arrive in your mail box each week, what do you do with them? Most people will flick through their mail, and tend to stop at those items that appear to be a hand written, personal letter from someone that they know.

We all love to receive mail, and we tend to ignore the window-faced bill envelopes. On top of the mail we receive, our mailboxes are often full with other advertising material. After a hard day at work, we most often do not have the time or the patience to sit down and read a letter from a company that ultimately wants our custom. Another issue to remember is that not all of your customers will want what you are offering at that time. If you are offering a special on a book or a service you provide, then only a small parentage of your customers will actually be interested, as they have a need that they need satisfied.

Despite these expected results, you will be surprised about how you can use it in your business.

Choosing Your Direct Marketing Approach

What are some direct marketing campaigns that are used by businesses? Some examples include:

  • Newsletters
  • Appeal letters – by charities, etc
  • VIP (Very Important Person) invitations
  • Product announcements
  • Special offers for your customers

Direct marketing has been traditionally delivered by the postal system. This will still continue to happen, and depending on your budget and business you should consider using this option with your campaign. However, with Internet and email marketing you have a much cheaper, quicker and more interactive option available for you to use. Depending on your budget, you should use both traditional and electronic delivery methods.

When preparing your campaign, you have two options in gathering your names and addresses to mail to. The first option is to rent or hire the details from companies that specialize in gathering data for direct marketing . The second is to gather the details of your own customers. Both of these options have their benefits.

Renting a Mailing List

If you have a young business (or are planning to start one in the near future) and have not gathered the names of your customers yet, then renting the names for your campaign is a great option for you. There are many companies that have already gathered mailing details across many different target markets. You are then able to contact these companies, often referred to as List Brokers, and organize to have a portion of these names rented to you for a one-off use.

For example, they might have the names and address, phone numbers, etc of CEO’s of financial companies, broken down by country and region. If you had a product or service that would appeal to these potential customers, then you can rent these names for your campaign. Another example is that if you wanted to contact consumers who had young children and shopped twice a month, they might have these details too. It all depends on what product or service you are offering.

This data is usually gathered in a lifestyle survey that postal services conduct each year. If the names are available for you to rent, then the consumer has given their permission to receive mailings from companies just like yours.

Advantages

  • Immediate access to mailing information
  • Qualified recipients for a mailing
  • Able to refine the information you want according to a set of criteria you have – location, age, interests, etc

Disadvantages

  • Can be costly
  • Can only use those names once for the fee – each time you want to do a mail out, you need to rent other names again
  • The potential customers have not heard of you before, which can reduce the effectiveness of the mailing

This option can be used to build your own database. Despite not being able to use the names again unless you re-hire them, you can add the details of those that respond to the mailing to your own database. They have now become your customer!

Some of these companies will give you a ‘deliverability guarantee’. This means that they guarantee a certain amount of your direct marketing pieces that will be delivered to the addressee (usually 98%). So, if you rented 10,000 names, and 9,800 were delivered, then they have met their guarantee. If only 9,400, then they haven’t, and you could possibly get a credit or a refund on the cost of these names. (i.e. Cost per name to rent might be 16 cents. If 400 names aren’t delivered, this might mean that you can get a $64 credit toward your next mailing).

Check what the list company’s deliverability guarantee is. Imagine what a mailing of 100 000 names would cost, if only 94% were delivered? At 16 cents per name, that would be $640 in credit to you!

Here are some list brokerage companies you can contact to begin your direct marketing campaign.

Australia

United States

As the above list is a tiny fraction of the resources you can turn to, a great place to start is with your postal service in your country or region. They will be able to either provide you with the right information, or point you in the direction you need to go. After all, they are in the business of delivering mail!

Build Your own List

This is by far the more preferred option for your business. Using your own database places you in a better position to get a more successful response from your direct marketing campaign. As long as the names and details you have gathered have been in accordance with relevant SPAM and Direct Marketing policy where you operate, then this is the preferred route to take. You should work towards having your own list to mail to as a long term goal.

Advantages

  • Low cost
  • Data can be used again and again without additional costs
  • You own it
  • The recipients have heard of you already
  • Can do many different direct marketing campaigns (newsletters, special announcements, etc)

Disadvantages

  • Limited to how many names that you can gather
  • If you customer base is local, then this might limit your business expansion

Ultimately, a two-pronged approach of using rented lists and your own list is a very effective way to use direct mail.

Take a look at your current database of names (if you have one), or consider how many people you want to contact for your direct marketing campaign. Have you a number yet? Is it 1,000, 10,000?

Make Sure You’re Spam Policy Compliant

What is SPAM? SPAM relates to any unwanted emails and letters that you receive in your email inbox. It is a result of the prolific explosion of unwanted emails that people have received from all over – from people promoting illegal products to soliciting money fraudulently.

Traditional mail can still be accused of SPAMMING, but often this will result in negative company image and a disgruntled consumer giving your business a bad reputation. With electronic mail, this can result in massive fines and possible jail time. It is very important that you comply with SPAM policy. If you do, then you have nothing to worry about.

How do I become compliant?

With electronic gathering of names and addresses, you must always give the reader a chance to remove themselves from your list – known as ‘unsubscribing’ or ‘opting out’. This needs to be included in every single mailing that you send to your customers. You also need to state how you use their details – i.e. what your Privacy Policy is.

When people are joining your list, an effective way to be SPAM compliant is to employ what is called a ‘double opt-in’ approach. What this means is that once they have asked to join your list, they are sent an email to confirm that request. In effect, they ask you twice before they go on the list.

As long as there is an expectation to do business with and communicate with the recipient due to normal business dealings, then it is acceptable to use their details in a mailing. If you are unsure about your legal obligations in relation to spamming please contact your solicitor or legal advisor. For more information, please review the PDF files and websites below:

Australia

United States

A Complete list of SPAM policy for other countries:

How does the Process work?

Once you have decided whether you will use a traditional or electronic approach and where you will get your names from, the next step is to write or prepare the direct marketing piece.

Let’s assume that you want to send out a letter announcing a new product you are about to launch. Gather all the information about the product, list the benefits, and begin writing. Remember, a customer does not buy a product – they buy what the product can give them. Keep that in mind with every communication to your customer. Remember – BENEFIT, BENEFIT, BENEFIT!

If, like most people, writing a sales letter or direct marketing letter scares you, do not worry. For most of us, writing is not a gift, but it CAN be learnt. Just as in writing media releases, writing a direct marketing piece can be developed. As a rule of thumb, if you allow your passion for your product or service to come through in words, then you are almost there. Some techniques that can help you include:

  • Scribbling notes
  • Talking to a tape recorder, then transcribing it
  • Talking to someone else and have them help you write it.

If you haven’t checked out Ken Evoy’s Make Your Content Pre Sell, then have a look at how that book can help you become a more effective writer.

We have used a great product called Instant Sales Letters. This product will give you access to tons of sample letters broken down into different target markets, and you can use them for your web business, dentist business, consulting or service-based business. Once you grab a copy of this for yourself, you can use the files however you want, and can be downloaded as a text file and fully customized.

We also have a couple of resources in our Business Resources section of the website that can help you with this part of the process.

Another option you might consider is to use a freelance writer to prepare the letter for you. A great website you can go to is Elance.com. This site gives you the opportunity to post the job that you need doing, whilst people who are skilled in the area you need can bid for the job. This option may be one that could save you hours of time and much more in stress, if you are not confident or have no time to write the direct mail piece yourself.

Check out Starting an Email and Direct Marketing Campaign to begin your own campaign.

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