Direct mail marketing is one of the oldest forms of modern promotion, but don’t let its age deceive. Mailing coupons or even catalogs to potential customers can significantly improve site traffic and sales conversions. While the exact origins of direct mail marketing are in question, there are examples of savvy business folk using the tactic more than 200 years ago.
Build Web Traffic With Direct Mail
For ecommerce businesses, traffic is king. The more visitors that an ecommerce site receives, the more that ecommerce site is likely to sell. In the effort to generate traffic, storeowners will certainly use several marketing channels and campaigns, and by no means will I disparage search engine optimization, pay-per-click (PPC) advertising, banner advertising, or even print advertising. But too many ecommerce marketers may be overlooking direct mail, which can provide very good conversion rates. It is far more measurable than other promotions and it allows a marketer to provide a full and rich presentation of a business’ value proposition.
The Potential for Outstanding Conversion Rates
As with any marketing tactic, direct mail’s conversion rates are as much a function of the quality of the messaging as they are a result of the media (direct mail). A poorly conceived direct mail campaign won’t offer much of a benefit, but because direct mail is not as limited as, say, PPC, it is possible to be far more creative and communicative in direct mail than in almost any other media.
As an example, consider a 2006 American Express direct mail campaign designed to increase renewals for the very exclusive Centurion Card in Australia. AmEx had just boosted the annual membership fee to almost $2,000 and had concerns that many of the cardholders would think that the fee was too expensive. But AmEx developed an impressive titanium card sample, etched a metal letter explaining the cards benefits, and sent the metal direct mailer to its target audience. The campaign generated a reported 85-percent conversion rate, and earned American Express millions of dollars, according to Royal Mail.
Similarly, a research report from the New York Department of Health Behavior found that sending a direct mailer to smokers explaining the health benefits of quitting and offering a free nicotine patch increased call traffic 36 percent and drove conversions up nearly 11 percent.
In general, a good direct mail campaign should convert about 1-to-5 percent of its recipients. So an ecommerce site that mailed out 10,000 postcards with coupon codes, should expect between 100 and 500 of the postcard recipients to convert, visiting the site and making a purchase. That sort of a response rate offers a lot of opportunity for ecommerce merchants.
Easy to Measure, Easy to Adjust
Ecommerce retailers, like all businessmen, want to earn the best possible return on their marketing investment, and direct mail makes tracking that return very easy. The simplest method for tracking direct mail campaigns is to use a custom URL or subdomain. For example, if your store’s URL is somestore.com, try purchasing the domain somestoreonline.com and using only this second domain in your direct mail campaign. Then monitor traffic through the new domain. Or if you are offering a 10-percent discount in your direct mail campaign, try using the subdomain discount.somestore.com, and track the web traffic to that subdomain and landing page.
Many marketers have taken to using personalized URLs. In this case, you might use a subdomain that included your prospect’s name. So if you sent a mailer to Jane Doe, the URL in the mailer might be jane_doe.somestore.com. You would be wise to include Jane’s name and a mention of the mail offer on the landing page.
Direct mail also makes it easy to test two versions of your marketing message. I once worked on a direct mail campaign for a large Fortune 500 company. The company was trying to generate web traffic. And the product was a tool that saved power. The company wanted to know if customers would be interested in a message about cutting so-called greenhouse gases or if they would be more motivated by a cost savings message. Turned out that talking about saving money generated eight times as many responses as promoting the product’s environmental benefits. In the next mail, we tested two cost savings methods, to determine if it was it better to talk about cost savings in terms of an annual total or a monthly total. In this way, we refined the campaign until it had a very high conversion rate.
Direct Mail is an Extremely Creative Medium
Finally, direct mail allows ecommerce marketers to be very creative. Mailers can be a postcard with great graphics, a catalog (which will generate a lot of extra traffic), or virtually anything that you can imagine. Direct mail campaigns are not bound to web safe colors or short text strings. American Express sent metal credit cards. Microsoft has sent IT managers Russian stacking dolls, and many companies (i.e. L.L. Bean, Sears, J. Crew, Victoria’s Secret) have built huge followings for their catalogs.
Because of this breadth of creative opportunity, marketers can better communicate a store’s value proposition and, frankly, do more to persuade customers.