Just last week we held our most recent Masterclass, Driving online sales through a new channel. Attended by e-commerce businesses, we're finding pure-play companies are really embracing the printed catalogue as a new channel to market.I was recently interviewed by print production agency Cousin on this theme. These were my responses to their questions around the renaissance of direct mail and its role in today's digital-first world.
What do you think is a common misconception about direct mail as a marketing channel?A lot of people view direct mail as outdated or only appropriate for retailers who target older audiences. I would say this is untrue, as there has been a recent surge of ecommerce start-ups using a catalogue or direct mail to drive new and existing customers to buy online.
What is driving this resurgence of direct mail?Start-ups these days will grow organically through one or several online marketing channels, whether that’s Google AdWords, retargeting or social media. Traditionally, this has been the cheapest form of marketing from a cost per acquisition (CPA) perspective. However, every retailer will eventually find that their growth curve through online marketing alone begins to plateau. Then they begin to explore alternative customer acquisition channels. Many have found that sending a piece of well-targeted print marketing at the right time with the right offer can open up a completely new audience.
How can the cost of direct mail compete with the affordability of online marketing?
Online marketing CPAs are increasing. The actual cost of an online campaign is always going to be cheaper than direct mail due to the cost of print and postage. However, when you look at return on investment (ROI), the results are often surprising. Every retailer runs online marketing campaigns, they’d be mad not to, but this is making for a saturated market, driving up the cost as brands compete for the same customers. In addition, customers recruited online tend to spend less per order than direct mail. The result? Direct mail CPAs are looking increasingly comparable, if not cheaper, than online!
What is the main advantage of employing direct mail as a marketing channel?
Direct mail recruits are more likely than those recruited online to become brand-loyal. This is because a catalogue, “look book” or similar is a great way to convey your brand values and quality to a customer that’s never bought from you before. This explains why they spend more per order and purchase more frequently. Couple this with the fact direct mail opens up new audiences and helps gain cut through (compare your inbox with your doormat for example!) and you have a recipe for sustainable long term business growth.
Can a business successfully adopt a direct mail marketing strategy if it already runs existing online campaigns?
Yes, and you should be running your online marketing campaigns in parallel with your offline activity. 75% of people that respond to a piece of direct mail do so online. This mean, for example, a Google AdWords strategy is needed to ensure they find you if they don’t have your catalogue in front of them when they are ready to buy. The message from the marketplace is simply that incorporating addressed printed marketing into your multi-channel marketing strategy works.
Important considerations for a business adopting a new direct mail campaign
It is important to take advice from companies that can help you to create a profitable first direct mail campaign. By working with the right partners, you’ll avoid the common pitfalls made by direct mail newbies and produce a cost-effective piece of printed direct marketing.
Deciding who to target is just as important to campaign success as deciding on what products go into the catalogue and how it looks creatively. That’s where Epsilon Abacus comes in. We manage the Abacus Alliance, a data co-operative of 500 retail brands who contribute customer transactions on a weekly basis. This is used to understand UK consumer behaviour – how much they are spending, how frequently and in which retail categories. This shared database gives a rich insight into shopping behaviour to predict what people are likely to buy in the future so only those likely to be interested in your product are selected to receive a catalogue.
If you're interested in what our Masterclass covered, you can downlod the slides by going here.