Direct Mail Continues to Thrive

Written By Ted Grigg

Direct Mail is growing by 4% to 5% per year in advertising mail according to Craig Simpson, a leading direct mail consultant, coach and author of The Direct Mail Solution and The Advertising Solution.

In the world of direct marketing, testing determines the winning channel. In other words, test all channels and rollout the winning tests. So the core channel, offers and creative executions are selected based on results and not the marketer's preferences. That’s how direct mail comes on top.

DMNews invited a couple of guests to respond to their question: "Will direct mail remain a top channel?" 

Dave Lewis, CMO, Message Systems, a 25-year direct marketing veteran for both offline and online says, " Direct mail has been the workhorse for generations of direct marketers. But it's time to put that workhorse out to pasture, and recognize that digital messaging – e-mail for today – is the one for our future." 

I could not disagree with him more.

The answer to the question posed by DMNews is not yes OR no, but yes and no. It all depends upon the test results.

In fact, the core medium varies from one market segment to another. If your target market revolves around rural areas, then your core medium may indeed be solo direct mail. But in suburbia and exurbia, you will likely see markets that gravitate mainly to online.

Your core medium for some market groups may actually require multichannel support for maximum profitability.

Direct mail suffers from ever increasing costs. But email suffers from lack of credibility that continues to battle the growth of spam. So saturation continues to dilute email as an acquisition tool. Email works best with existing customers who already enjoy a relationship with the advertiser. 

As direct mail increases in price and its volume in the media mix decreases, direct mail gains new strength because of its growing credibility. The high cost of entry in using direct mail weeds out the fly-by-night businesses.  

Unfortunately, email's low cost attracts low quality businesses and spammers. 

So I predict that direct mail as a direct marketers' workhouse will continue to grow for some time. 

The bottom line: the best marketers favor what works based on testing and should remain media agnostic.

Ted Grigg

Ted Grigg is a direct response strategist who helps growth-focused companies reduce risk by identifying weak assumptions before they become costly mistakes.

Over the course of his career, Ted has evaluated several hundred million dollars in direct response testing across direct mail, digital, print, television, telephone, and other channels. His work combines direct response strategy, acquisition economics, customer analysis, creative evaluation, offer development, and disciplined testing.

Ted has worked on both the client and agency sides of the business. That experience gives him a practical understanding of the pressures facing executives, marketing teams, agencies, and service providers—and of the problems that arise when activity, media volume, or creative preference replaces a clear economic objective.

His consulting work helps organizations examine such questions as:

  • Are acquisition goals economically realistic?

  • Is the allowable Cost Per Sale supported by customer value?

  • Are targeting, offers, creative, media, and response paths working together?

  • Are tests structured to produce reliable business decisions?

  • Are unproven assumptions being treated as facts?

  • Is the organization measuring sales outcomes rather than convenient proxies?

Ted’s experience includes the development of direct mail and multichannel acquisition programs for insurance, healthcare, financial services, technology, nonprofit, manufacturing, retail, transportation, communications, government, and business-to-business organizations.

For a national direct-to-consumer insurance company, he developed a direct mail format that defeated established controls and helped expand the productive use of compiled prospect lists from less than 10 percent to more than 30 percent of total direct mail circulation within one year. He also planned Medicare lead-generation programs for more than 60 regional and national HMO and PPO organizations, with some programs exceeding sales projections by as much as 60 percent.

Ted founded Wyse Direct, a direct marketing division of Wyse Advertising in Cleveland, where he developed acquisition programs and helped launch a new technology product for Seiko Instruments by generating a predictable flow of qualified sales leads for its national sales organization. As vice president of new business development for the Grizzard Agency, he helped broaden the agency’s strategic capabilities and pursue new commercial and fundraising opportunities.

He is the author of The HMO/PPO Marketing Plan—A Step-by-Step Guide, published by Executive Enterprises, and has written numerous articles and conducted webinars on direct response strategy, testing, creative development, and marketing economics.

Ted earned a Bachelor of Arts degree from Abilene Christian University and completed two years of graduate study at Texas Tech University. He is the founder of DMCG, LLC.

http://www.dmcgresults.com
Previous

The Future of Direct Marketing
Next

Do Multiple Response Options Decrease Response Rates?