“Am I getting good direct mail response rates?” is not a simple yes-or-no question. Averages vary across industries, campaign types, and more.
But that doesn’t mean the question isn’t worth answering. To gauge the health of your direct mail campaigns, you need to critically assess your responses—including their frequency, quality, your industry’s typical response rates, and so on. This evaluation process will reveal ways to improve your direct mail and help you develop best practices to drive positive results with future campaigns.
You might think that a direct mail campaign with plenty of responses is a healthy one. Sometimes that’s the case—but the amount of responses isn’t the only relevant factor. Take a more holistic approach by considering your direct mail responses from a number of angles.
Tracking direct mail responses was once nearly impossible—there wasn’t always a way to determine if a piece of mail got delivered, much less if it was effective. But with digital advances like QR codes and platforms like Lob, tracking can be an easy, automated process.
The most straightforward methods of tracking response rates are:
Include any of these four elements in your direct mail design to track responses. With a platform like Lob, you can even take this a step further with piece-by-piece delivery tracking to track the actions of individual recipients.
Once you’ve monitored responses with these methods, you can compare the data against industry benchmarks to gauge the health of your campaign.
Direct mail response rates can vary based on industry and type of direct mail. To set a benchmark for your campaigns, find out what the average is in your sector.
Here’s a high-level stat to get you started: over 64% of businesses (in financial services, e-commerce, travel, media, auto, telecommunications, insurance, and healthcare) agree that direct mail delivers the best response rate of all their channels. If you’re in one of these industries, is direct mail one of your top channels? If not, your response rate could likely be higher.
To set a specific benchmark, talk to others in your industry. Direct competitors may not be willing to reveal their response rate to you, but you can ask companies in adjacent industries what their average response rate is. If you work at a major shoe retailer like DSW, you could talk with someone in clothing retail. Or, if you work at a regional credit union, talk with someone at a credit union in another region.
When chatting with industry experts about their direct mail campaigns, be sure to ask about their ROI to see if they are on par with the average direct mail ROI of 29%.
Lastly, consider how response rate averages differ across types of direct mail:
Compare these results with your own response rates to gauge the health of your direct marketing.
Response rate is only half of the equation. Pay attention to how qualified the responding leads are, too.
A variety of factors determine response quality, and they differ depending on if you’re running marketing campaigns or transactional campaigns.
For marketing initiatives, ask yourself the following questions:
Evaluate your response rate quality based on the answers to these questions. Did you answer “yes” to most of them? If so, your direct marketing is on the right track.
For transactional initiatives, like sending an invoice, ask these questions:
The business intelligence and data analytics company Saylent built Lob into their proprietary platform to execute direct mail campaigns and track the quality of responses. Find a platform such as Lob that you can integrate with or build into your current tech (preexisting platforms or proprietary) to do the same.
Even if you already have decent direct mail response rates, there is always room for improvement. Use the data you collected in the last section to optimize future campaigns.
You’ve tracked your response rate and quality in the last section. Now it’s time to investigate the similarities across campaigns with many high-quality responses.
One way to identify these trends is to use multivariate testing. Find a platform like Lob that makes testing different variations easy with functionalities like modular HTML templates.
Once you’ve gathered information about your response rate and quality, form some hypotheses about what elements made your campaign effective or ineffective. Then use these templates to test different elements such as designs, copy, etc., to determine what drives a higher response rate. For example, if you’re a bank advertising a new credit card via letters, test different layouts and imagery or highlight different benefits of the card.
Once you’ve identified trends across successful campaigns, use those insights to optimize your next campaign.
Let’s stick with the bank example. Maybe messaging about the travel rewards of your credit card drove higher response rates than highlighting the low APR. Great! Double down on highlighting travel rewards in your direct mail.
You may also find that some imagery works better than other visuals. If multivariate testing showed that your campaigns thrive with human imagery, double down and use these photos in more (if not all) of your campaigns.
Use a platform like Lob to automate the process of doubling down and update dynamic content in real-time for continued optimization. With this automation, you can spend less time and money analyzing your results and redesigning your direct mail.
Once you’ve doubled down, don’t stop tracking your results. You may find that what works changes over time. In the era of COVID, you may find it’s better to highlight that low APR instead of the travel rewards...at least for now.
Based on the trends you find and what you double down on, you can extrapolate best practices and put together a style guide to steer all your campaigns going forward. This will help you ensure they’re effective and consistent, no matter which team member takes the lead.
Here are some hypothetical best practices you may uncover:
As you implement your new best practices and continue tracking your campaigns, you’ll be able to continually improve your response rate and scale your direct mail initiatives.
But remember, your direct mail marketing strategy is only as strong as your omnichannel marketing strategy. When your direct mail is triggered by digital behaviors, it becomes more timely and relevant to your customers’ needs—and as a result, is more likely to drive a higher response rate. To improve your direct mail response rates further by integrating your digital and direct mail marketing, check out this article.