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With 2023 just around the corner, many marketing teams are planning their marketing strategies for the new year and identifying what channels are must-haves, which ones must go, and which ones can be tried and tested.
But within your team's overall marketing strategy, it's important to break down each channel and build a strategy for them as well. You'll have your email marketing strategy, social media marketing strategy, content marketing strategy, PPC strategy, and so on that all funnel into your overall marketing strategy. Today, we're here to help you build your direct mail marketing strategy for 2023 so you can set this channel up for success and meet your team's overarching marketing goals.
Speaking of goals, it's time to jump into step 1 of creating your 2023 direct mail strategy.
What are you looking to achieve throughout the year? If you're looking to juggle several different goals, you should ask which of them your campaign will prioritize. Most direct mail strategies have one of three goals in mind: acquisition, reactivation, or retention.
Of the three direct mail campaign goals, acquisition is the most obvious. While customer acquisition costs (CAC) vary heavily by industry, they do tend to be significant. For example, recent data has put the average price per customer acquisition at $205 for SaaS, $862 for education, $640 for financial services, and $410 for business consultants.
A top task of a direct mail marketing strategy is to use the medium to reduce your CAC. Direct mail can play a profound role in driving down CAC, owing to the channel's comparatively high ROI. In fact, our 2022 State of Direct Mail report found that 67% of marketers say direct mail provides the best ROI of any channel.
In the early 2000s, Bain and Harvard Business School set the marketing and sales world on fire with a bold theory. By increasing retention by as little as 5 percent, Bain and HBC argued that a company can boost its profits by up to 95 percent.
This theory draws from the idea that repeat customers become more affordable per transaction. For example, repeat customers require far fewer marketing resources to continue doing business with. As a result of ever-lowering costs relative to their revenue, repeat customers grow substantially more profitable over time. A direct mail strategy for retention campaigns is often centered around this idea.
Such a strategy aims to leverage your customer relationships and the data you've gathered on said customers. Using this intelligence and data, you can precisely target customers with suitable products, services, information, and offers. As a result, they don't require any investment in third-party data or intelligence.
Reactivation campaigns are centered around re-securing and reactivating past customers. As with retention campaigns, ones centered around reactivation can leverage your existing data and be highly targeted - especially if you understand why they left the relationship with your brand in the first place. Was it pricing? Use direct mail to share new pricing tiers or a sale. Did the customer leave to do business with a competitor? Send them a mailer that outlines key features your product or service has that the competitor might not have or any upcoming releases that could solve a specific pain point.
Now, it's time to look at your overall budget for your marketing efforts. Any direct mail strategy has to sit within a broader omnichannel marketing strategy and is competing with channels that may appear more affordable on the front end.
Direct mail is a powerful channel, but like any channel, it needs to be matched to the right campaign to drive the best results. If you're hosting an exclusive event for your customers, you most likely won't be running PPC ads that anyone can see and you might even hide the landing page from the search engines. In this example, more budget should be allocated to direct mail as this channel is well-suited for a personalized invitation for your customers. Understand what campaigns require a direct mail budget and allocate accordingly.
One reason many marketing teams trust Lob for direct mail marketing is our fixed, flat-rate pricing. This allows you to better predict campaign costs and track which campaigns are driving more ROI.
Once you've set your overall strategic priorities, you need to consider the processes you'll be using to ground your direct mail strategy for 2023, as well as identify tests you can run to optimize your campaigns to reach your 2023 goals.
Just as you run A/B tests on emails or landing pages, you should be testing your direct mail as well to better understand what your customers or prospects respond to. Tests could include:
Cleaning up your customer and prospect database is a prerequisite to effective testing, experimentation, and personalization for your campaigns. Reviewing the validity and value of your data is essential to ensuring robust campaign ROI and can be achieved via address verification capabilities.
If you're interested in learning specifically about strategies to improve direct mail's ability to achieve your team's goals, get your own copies of Lob's guides to direct mail marketing for acquisition, retention, and reactivation.
And if you need help in modernizing your direct mail marketing strategy, the Lob team is here for you. Lob's direct mail automation platform is an industry leader in enabling teams to design and distribute personalized campaigns which link to your omnichannel efforts. Sign up for a demo if you're curious, or contact us to learn more.
