Direct mail marketing is booming. Mail order sales rise at a rate of 10 to 15 percent annually, much faster than general retail sales. In 1991 the Postal Service delivered 65 billion pieces of direct mail, more than double the number for 1980.
The reasons for such growth are numerous. The increasing costs of transportation, the hassles of in-store shopping (driving, parking, walking, crime), the decrease in the amount of shopping time for increasing numbers of women-all are factors. The greater use of toll-free telephone numbers and faxing, the growth and popularity in television shopping channels, more in-home shopping by the affluent and better educated consumers are added reasons.
The fact is, direct mail materials are read and used. Contrary to public opinion, studies show that most people want to receive sales-offer mailings. In one recent study, more than 81 percent declared they open and look at their direct mail. Products or services offered are purchased, at least occasionally, by 57 percent. Marketing experts say these percentages probably are on the low side.
STEPS IN PLANNING
All advertising requires careful planning. That requirement is especially true for direct mail literature. But an effective presentation need not be extra difficult or costly to do.
1. Plan your offer.
Decide what you want your offer to accomplish. There are many promotion ideas for which direct mail is the logical choice.
• Supplement your other advertising.
• Reach a select few prospects.
• Increase referrals for your custom design or other services.
• Announce an open house or other special event.
• Expand your customer base.
• Announce a new product, fashion collection or service (most common use).
• Set up appointments for in-home selling.
• Thank a customer for a purchase, referral or inquiry.
There are dozen of other uses for direct mail. The more definite your objective, the better your results.
2. Plan your mailing list.
Any advertising should be targeted as much as possible. With direct mail, you can narrowcast to reach a select group for your products and services.
Start your list with your current customer base. Comb through your customer list, eliminating non-prospects whenever possible. Then, add to your list to meet target objectives.
List additions can be built from various sources. Use telephone or other area directories such as service or country club membership, women's groups, real estate or builder's new sales lists. Include a special coupon offer in your newspaper, then compile a list from responses.
3. Rent a list.
To expand your mailing to cover a broader geographic area or demographic group, you may need to rent special prospects lists.
Determine your desired target group, then contact a mailing list company, which compiles and sells specialized lists of all categories. Your yellow pages directory will carry telephone numbers, probably under the category Mailing List Brokerage Firms.
Rental or purchase costs for lists are based on price per hundred or price per thousand names depending on the quality or specifics of the list you want. Such lists, regardless of quality, will seldom equal the responses from your own compiled list.
Once you have assembled a good list, keep it current. As many as 25 percent of your list may change within a single year. It may be good to send a correct address information card to update your customer and prospect lists occasionally.
4. Prepare your mailing piece.
How to select or create materials for mailings is a major problem for most retailers. They see the colorful and expensive catalogs, folders or booklets distributed by large retail chains and mail-order companies. They read the exciting sales copy and note the reduced prices presentations. They end up feeling inadequate to meet such competition.
But, there are no specific rules about copy or graphics that you must follow when creating print or broadcast offers. Color and good copy might help increase the pulling power of a promotion piece. However, an elaborate printed piece or commercial can be a magnificent waste if it overlooks product or service benefits or an incentive to reply to your offer.
A postcard or personal letter can be an effective sales tool, too. If your quantity is small, a personalized card or letter can present a desired person-to-person look and impression.
More sophisticated materials could require outside assistance. A small advertising agency, a local art studio, an area printer or a small desktop publisher can offer a sales promotion job package. Their copywriters and artists will study your idea and offer, then create a mailing piece for you including envelopes and mailing to your select list.
5. Keep a record of results.
You'll want to maintain accurate records of costs and sales from mailings. More than other media, direct mail can give you good measurements of advertising effectiveness.
You can determine unit costs and sales, then compare totals with other kinds of advertising. You can determine which offers, selling approaches or market areas bring best results. You can compare types of response from coupons, toll-free orders, mail-ins or collect calls.
6. Measure mailing methods.
Your best bet for a small quantity mailing is still first class mail. Even with increasing postal costs, the personal appeal of an individual mailing usually will bring the best response.
For large mailings, ask your local post office about bulk mailings. You should know about rates and the special ways in which your material must be sorted and handled. For even larger mass coverage, investigate the costs of using an insert in your local newspaper, especially the Sunday edition.
The increased growth of direct mail is a certainty, according to all economic forecasters. Response and techniques may take new forms, such as two-way TV, infomercials, videotape catalogs, computer networks, e-mail and other electronic marvels. Who really knows? But, regardless of methods used, smart retailers know that direct mail should never be considered as junk mail. It's sales mail.
John J. Lichty is a consultant and senior editor for Draperies & Window Coverings magazine. He has more than 30 years experience in the planning and administration of various consumer, trade and retail advertising programs. Editor's Note: The following is the fourth installment in a series of articles covering the basics for retail advertising with an emphasis on the needs of home fashion retailers. The preceding three articles were: "Advertising by the Numbers," August 1998; "Step-by-step Advertising," October 1998; and "Where to Advertise," January 1999. This article take a step-by-step approach to planning a direct mail sales campaign.
The Personalized Medium Positives:
• Can target specific groups and market areas.
• Less waste audience than other media.
• Messages and formats can be personalized, detailed and persuasive.
• Can measure feedback. Results can be analyzed easily to check response rates, costs and sales.
• Can include supplier materials for co-op assistance.
• Can piggyback with other retailers' direct mail offers.
• Can use unusual paper stock, shapes, sizes, layouts and kinds of enclosures. Negatives:
• High unit costs (for design, printing, lists, distribution, etc.).
• Low average response rate (average two to three percent).
• Possible junk mail prejudice could cut response.
• Must use accurate and current mailing lists.
• Quality look of mailer (envelope, printing, paper).
The many forms of direct mail Direct mail can be used to inform, persuade, remind and assist. Here's a partial list of print materials that can be used as direct mail pieces:
• Business cards
• Ad reprints
• House or shelter magazines
• Instruction sheets
• Order forms
• Postal cards
• Price lists
• Printed novelties
• Reply cards
• Sales manuals