Is Printed Direct Mail as cost-effective as other Direct Marketing?

by Rich B

Some interesting information from the Direct Marketing Association’s 2010 report. The report tries to provide key performance benchmark figures for marketers to assess their own performance. But it also gives a valuable insight into the effectiveness of printed direct mailing, particularly in comparison to some of the other non-print forms of direct marketing.

catalogues - lowest cost per lead/order

Your typical catalogue - a great return on investment!

The report is primarily US based (hence the figures in $) but it gives a great deal of insight for the rest of us too.

What was particularly interesting to see was that catalogues had the lowest cost per lead/order, with inserts too beating email which is often perceived as particularly cost-effective.

Highlights:

  • Response rates for Direct Mail have held steady over the past four years.  Letter-sized envelopes, for instance, had a response rate this year of 3.42 percent for a house list and 1.38 percent for a prospect list.
  • Catalogues had the lowest cost per lead/order of $47.61, just ahead of inserts at $47.69, email at $53.85, and postcards $75.32.
  • Outbound telemarketing to prospects had the highest cost per order or lead of $309.25, but it also had the highest response rate from prospects of 6.16 percent.  The highest response rate for a house list was also telephone, at 10.41 percent.
  • Email to a house list averaged: a 19.47 percent open rate; a 6.64 percent click-through rate; a 1.73 percent conversion rate; with a bounce-back rate of 3.72 percent and an unsubscribe rate of 0.77 percent.
  • Response rates for B-to-B campaigns were generally higher than for B-to-C campaigns.  Lead generation and high-end average sale campaigns also had higher response rates.
  • Nearly 60 percent of direct mail campaigns in financial services aimed to produce a direct sale.  The average response rate was 2.66 percent to a house list and 1.01 percent to a prospect list.

*The survey came in from 473 respondent organisations.

For more reading, you might want to check out our 14 Tips to Increase Direct Mail Response Rates.

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