Why Direct Mail Is Marketing's Hottest "New" Tool

We meet a lot of people who are ready to try direct mail, excited by the ease and customization that Lob has brought to a previously inflexible format. Still, marketing offline for the first time can be daunting. Where do you start—and should you start at all? Marketing expert Adelyn Zhou shares some of her direct mail expertise from companies like Nextdoor, Eventbrite, and Amazon. Follow her on LinkedIn or Twitter.

With the continuing rise of online ad prices, companies are seeking additional, cost-effective user acquisition channels. Ironically, many technology companies that previously eschewed traditional marketing are now embracing one of its oldest forms, direct mail.

From B2B companies such as Square and Autopilot to B2C companies like Munchery and Handy, startups and larger companies alike are using direct mail extensively as a key acquisition channel. If you’ve paused on the shiny postcard in your stack of bills, or saved a discount code from your mailbox, then you already know: “mail is back.”

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Amplify Your Message

But why this return to direct mail? Companies are finding that it affords them reach and flexibility that other formats simply can’t, allowing them to:

• Leverage geographic targeting: Many companies focus on reaching users in a specified geography. With direct mail, you have complete flexibility to do just that. You can target a city, ZIP code, or street, right down to an individual address. It is significantly more specific and accurate than the IP-based geographies of many online marketing channels. Direct mail works especially well for location- and home-based services such as real estate, local delivery services, etc. It’s also great for city launches.
• Tap unreachable segments: Some people just aren’t online. Direct mail reaches everyone, especially those less tech-savvy or the elderly. It is also a great channel for B2B outreach. People get so many emails that it’s nice to open a piece of old-fashioned mail from time to time.
• Lower their cost of acquisition: The price of a piece of mail is fixed, and based only on printing and postage. Unlike competitive auctions for online ad impressions, those costs don't fluctuate based on demand for that physical mailbox space. With a reasonable conversion rate, you can get attractive acquisition costs.
• Diversify acquisition channels: Direct mail can be a valuable complement to existing channels. It has the potential to reach a large audience (all of the US population with a mailable address) and reinforce existing online outreach (as you’re not bidding on the same display ad space). Converting a customer often requires multiple touch points, and direct mail can be another way that you speak to potential customers.

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What to Know Before You Start

While direct mail is great for all of these reasons, there are some things that it isn’t. Before you jump into a direct mail campaign, be sure to prepare for:

• A moderate initial investment: You need to make a moderate initial investment (at least a few thousand dollars) in order to get a large enough sample for statistically significant results.
• Longer lead times: Due to printing and mailing, direct mail requires a longer lead time. There is also a much longer conversion tail, sometimes up to months or even a year, so you have to be patient for results.
• Unchangeable collateral: Once a printer sends out a piece, you can’t go back and change it. What is mailed is mailed. It’s essential to double- and triple-check creative proofs before they’re sent to the printer and to review your materials after they’re printed.
• Constant testing: As with any other marketing channel, direct mail requires constant testing and optimization. Even if your initial results are disappointing, test, test, and test some more. I’ve seen dramatic improvements of more than 300 percent for some campaigns.
• Paid campaigns: While direct mail acquisition costs can be low, they will never be as “free” as viral or social campaigns. Because of production and postage costs, there will always be a price associated with mail. That’s why direct mail is better for products with at least some room in cost of acquisitions.
• Quick product snapshots: There’s not a lot of space to make your case with direct mail; you might, for example, have just 4x6 inches to introduce the product you’ve spent years developing. Direct mail tends to be less effective for complex products—which often require a more nuanced sales pitch—leading to the acquisition of customers with a lower lifetime value.

The targeting and reach of direct mail can’t be beat (hence the tons of companies flocking to it!). Just carefully consider the fit with your product, timeline, and budget before you get going. If the answer is yes, there’s never been a better time to add this powerful, and relatively low-cost, tool to your acquisition strategy.

Booting Up

Sign up for a free account to see first hand how Lob is making this old format new again by eliminating print minimums, empowering total customization, and automating every step of the process with simple APIs.

To learn more about running a successful direct mail campaign, take a look at:

• Part 2: The 4 Components of a Winning Direct Mail Campaign
• Part 3: 6 Tips for Optimizing Your Direct Mail Performance

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