What You Need To Know
To Add Direct Mail
To Your Marketing Mix
Dear Business Builder,
Welcome back! In last week’s issue, we started talking about direct mail and why – as an internet marketer—you should consider adding it to your marketing mix. If you missed it or just need a refresher, I’ll do a little recap.
Direct mail is without a doubt the most targeted medium for generating new customers. And that is simply because you can rent the mailing list of your biggest competitor’s customers … the customers that have bought a product just like yours (or very similar) in the recent past. Your competitors’ “product buyers” are your best prospects and will be the most responsive to your offer.
And that is why, as an internet marketer, you must explore adding direct mail to your marketing mix … so you can generate loads of new customers.
If you didn’t get a chance to read last week’s issue, I suggest you check it out. It’s a good starting point for what we’ll cover today.
And speaking of last week’s issue, I noticed a few comments and I received a few e-mail questions asking how to integrate direct mail with your web marketing efforts. Y’all are jumpin’ ahead on me … I plan to cover that in next week’s issue. In fact, we’ll look at some really creative ways to draw attention to your website with direct mail.
But first things first …
Mailing Lists … the Basics
I think it’s important we start with the basics … especially since we all have different levels of marketing experience here at The Total Package.
There are two different types of mailing lists you can rent … both are viable depending on your type of business.
Response Lists: This type of list is comprised of prospects that have responded by mail to a particular offer. When looking at response lists, it is important to understand exactly how the list was generated.
Response lists are typically made of …
- Buyers or Active Subscribers – Prospects that bought a particular product through the mail or are paid subscribers to a publication …
- Cancels or Expires – Seen mainly in circulation, these are past customers that either (you guessed it) canceled their subscription or did not renew and …
- Prospects or Catalog Requesters – people that responded to an offer for some sort of free information or asked to be added to the mailing list.
Direct mailers that sell products through the mail (such as catalogs and one-off book publishers) and circulation marketers (such as newsletters and magazines) typically market exclusively to response lists. That’s because these “direct mail responders” have responded to a similar offer in the past so are the least risky and present the best possible chance for the mailer to break even or better.
Response lists are typically rented for one-time use only and have a 5,000 record minimum.
Compiled Lists: These lists are not made up of known buyers or responders. This type of list is combined together from many different types of data sources such as USPS records of addresses, Department of Motor Vehicle registrations, credit card and mortgage data and warranty card information, to name just a few.
These records are kept by the major credit bureaus on every household in the U.S., starting with the basic street address. Then, like building a house, additional information such as name, age, gender, and date of birth are added to the record as it becomes available.
Some records have more information and some have less depending on how active you are in doing the things that reveal the more personal details of your life.
Compiled lists are typically segmented by …
- Regional location – This could be by state, by zip code, or even by USPS walk sequence (every house on a particular mail carriers route).
- Demographic selection – This could be by gender, age, income plus many other selections, such as whether the consumer is a homeowner or renter.
- Lifestyle or Psychographic selection – This type of segmentation is modeled and indicates what you are likely to do professionally or what your interests are. For instance, you might be an executive level employee with an interest in golf that is most likely to drive a foreign luxury car, read the Wall Street Journal and subscribe to the Robb Report or Town and Country.
Compiled lists are typically used by regional mailers that are looking to reach a prospect in the area they serve … think realtor, car dealer or hospital. But, many “response” marketers will tap into the sheer volume of compiled lists by modeling their own customer database. These means they will attempt to match their best customers with the compilers database to find a new list of prospects outside of their typical universe.
Compiled lists can be rented for both one-time use or can be purchased for multiple use or unlimited use depending on the list owner. Minimums are typically lower, but the smaller the list the higher the cost per thousand names (CPM) … plus, the more selects you request, the higher the CPM.
USPS: Friend or Foe?
After you’ve been in the direct mail biz for a little while, you quickly understand the struggle between the US Postal Service and the industry. Direct mail is expensive and postage can make up more than half the total cost. Plus, not to mention the USPS is pretty much the only game in town.
But, the USPS is set up as a work sharing institution. The more work you do in preparing your mail before it goes to the post office, the more postage discounts they’ll give you. So it’s important to know the rules … or short of that, it’s important to hire someone that does.
Now, I can’t cover all the rules that will get you the deepest discounts or we’d be here till next year (plus that’s what the USPS publications are for), but I can get you started.
There are three main classes of mail you are likely to deal with when starting out …
First Class Rate – Most expensive class of mail typically delivered within 3 to 5 days …
Standard Rate (previously known as bulk rate) – Less expensive, but has a minimum piece requirement to qualify and is typically delivered within 5 to 10 days …
Non-Profit Rate – Least expensive, but must be a proven non-profit to qualify.
And within those three classes of mail, there are three types of rate categories based on the size of the mail piece …
Postcards – A single or double card that is no larger than 4 1/4 x 6 which qualifies for the lowest rates within each of the above three categories …
Letters – A card, envelope or booklet that is no larger than 6 1/8 x 11 1/2…
Non-Letter Flats – A card, envelope or booklet that is larger than the maximum letter size but is no larger than 12” high x 15” long which makes up the most expensive category of mail.
Once you know the type of list you need and the class of mail you qualify for, you can begin to experiment with adding direct mail to your mix in an incremental, scalable and cost-effective way. Find a small yet knowledgeable printer or mail shop in your area to get you started. Many will also be able to help you with list selection.
Just remember, you don’t need to start out mailing to hundreds of thousands of prospects to make it work for you.
Start out small and mail to a couple hundred or thousand names. Test your creative, the format of your mail piece and your list to find a winning combination. Then roll-out your control from there.
Hope that helped … because next week we’re going to look at creative ways to use the mail to drive traffic to your website.
Until next week,
Julie McManus
Editor, In the ‘Net Trenches
THE TOTAL PACKAGE™
And Web Media Goddess
P.S. Are you in the ‘net trenches? Do you need help? Send
me an e-mail to AskJulie@MakepeaceTotalPackage.com and
I just might answer your question in an upcoming issue.
P.P.S. Have you checked out The Total Package affiliate program lately? We’ve added tons of new creative to help you earn cash on any new subscriber you refer and we’ve opened our archives up for the pilfering … Click Here to check it out NOW!
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Comment by Emette Massey — January 26, 2008 @ 3:34 pm
Hi Julie,
First let start by giving you and TEAM MAKEPEACE a much sincere single round of appause! I\’ve been doing quite a bit of posting to this website lately and you guys are top notch in everyway!
Here\’s a question for you. . . . actually a couple of questions.
First if your budget is very limited how can you overcome the \”minimum list rental\” requirements imposed by so many list brokers?
I\’ve heard 5000 names is oftentimes the minimum–far too many for my rental budget at this time.
And my second question would you recommend a list broker.
Any help is much appreciated!
Warmly,
Emette