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Metric Deep Dive: Conversion Rate
April 27, 2022

Metric Deep Dive: Conversion Rate

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Email has become notorious for causing unnecessary overwhelmso much so that achieving 'inbox zero' has become a goal for the modern professional. With digital ads, the story is the same. Consumers are overstimulated and tired of the bombardment of messages, which is causing them to turn a suspicious eye toward anything online that hints at a marketing gimmick. Fortunately for advertisers, there is a solution: Get back to the basics. With less direct mail being sent every year, people are no longer bombarded with physical ads, making it the perfect avenue to reach your target audience in 2022. If you're a smart marketer or company leader who has already taken this route, direct mail conversion rates are something you'll want to focus on.

What is your conversion rate?

Most marketers are familiar with this metric, but tracking direct mail conversion rates can feel daunting without the right tools. After all, you can't quickly set up conversion tracking and review the results like you can with online campaigns. Results come slower with direct mail, and you can't gauge your success just days after materials are mailed out.

To clearly monitor direct mail conversion rates on each campaign, you need to know what you are measuring. Your conversion rate is tied to whatever your call-to-action is. If you send out a campaign in hopes of generating sales for a new product, your conversion rate = sales for that product. If you're aiming for new customers, your conversion rate = first-time purchases. Every campaign needs a goal, and the success of every goal is tracked with this metric.

For direct mail, an easy way to calculate your conversion rate is: Conversion rate = total number of conversions / total number of mailpieces sent x 100

There are a variety of ways to increase conversion rates, like getting current customers to upgrade or setting up a referral program. They key is to choose a strategy that fits your business model and follow through. Too often, businesses spread themselves too thin. Rather than trying to do it all, executing just one or two methods will bolster team morale, raise revenue, and strengthen customer relationships. The first step is to choose your strategy. The next is to make sure you have the technology to track your direct mail campaigns.

Tracking direct mail conversion rates

According to the Direct Marketing Association (DMA), Bizo and Epsilon data revealed that direct mail achieves an average response rate of 4.4%. Meanwhile, email achieved just .12%. Contrary to popular assumptions, this means it's better to contact your customers with physical mail if you want to increase online conversions.

When it comes to tracking direct mail advertising, you have options. Here are a few:

  • Call tracking - Simple and direct, call tracking works for businesses that use call tracking software or simply have a staff member who can answer the phone and track coupon codes manually.
  • URL tracking - Campaign-specific URLs help brands put their digital analytics tools to good use. To make things even more personalized for users, you can set up a PURL to address each person on your mailing list.
  • QR codes - Once a niche option, QR codes have gone mainstream. Most consumers have encountered them at least once and know how to use them. When the code is scanned, customers are taken to a specific, trackable URL.
  • Coupon codes - It goes without saying that your customers appreciate special offers and deals. Coupon codes help you see which customers took advantage of a direct mail offer.

Of course, these tracking methods aren't absolutely foolproof. For example, it's possible that someone can receive your mail and make a purchase but simply forget to enter the code. However, tracking conversions will still give you a good picture of how well your campaigns are performing. You'll be able to see your results over time and see how different demographics have responded. Over time, this correlates not only to efficient ad spending but a better understanding of your customers too.

Do you have a clear-cut way to track conversions? Are you taking advantage of direct mail automation to get the most out of every interaction with your audience? Fortunately, a direct mail platform can handle much of the heavy lifting for you during each campaign. With all the data right where you need it, your team can test different mailer formats and CTAs to see what performs better. Lob is a platform that helps with direct mail conversion rates, address verification, and more. If you're ready to put your direct mail on autopilot, try a personalized demo with us.

Is direct mail still effective?

Skeptical about the use of direct mail to bolster your bottom line and reach the right customers for your business? Not only is direct mail still relevant to the modern company's goals, but it's also making a resurgence. Equipped with data that show your conversion rates, cost per acquisition, and ROI, your team can create an iterative direct mail process that only keeps getting better.

Learn more about how companies are using direct mail to create dynamic campaigns in 2022 in our report: The State of Direct Mail

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