After sending out samples of their automatic pop-up mailers to ad agencies and making a courtesy follow-up call, one UK manufacturer of B2B direct marketing pieces discovered a common misconception. Smaller agencies were commenting “I love your products but they are too expensive for our client base.” Fair comment – automatic pop-up products are more expensive than A4 leaflets – but just how cost effective are they?
The company’s promotional pop-up products are commissioned by agencies on behalf of clients with the intention of using them as a direct mail piece. The idea of a mailing piece is to create interest and generate response and in most instances it is the rate of response which is quantifiable and which is the initial gauge of the success of the promotion.
There are no definitive figures detailing exact response rates to direct mail but there are examples to be found via web searches for “direct mail response rates” and I will use those sources as a guide. A plain A4 leaflet, folded down to 1/3 A4 and sent out in a plain white envelope to a blanket coverage might generate between 0.2% response. A mailer with slightly better content and better targeting might generate a rate of 0.5% to 1% response. In general, a response rate of 2% to 3% seems to be acknowledged as pretty good. These figures come from Marketingprofs.com, an information site with a membership of over 300,000 marketing professionals and from Gaebler Ventures whose site features an information resource centre.
Automatic pop-up mailers come under the US description of “dimensional marketing” and in the States dimensional marketing is known to perform much better than unimaginative blanket direct mail. Kristian Industries website states that response rates of 8% – 14% are common for dimensionals whilst extremely successful campaigns have reported over 20% response rates. US direct marketing company, Immedia, publishes a white paper which quotes DMA figures for dimensional marketing response rates to be as high as 8.3% whilst it goes on to cite several other cases where rates of 7% to 30% have been reported.
Testimonials on the company’s own websites quote figures of 9.6% success – not just response, but actual new accounts being opened!
Let’s look at a pound-for-pound example
The cost of a mail shot should be measured against its success and not against the initial cost. Let’s take a simple mailshot of 5000 leaflets sent out to 5000 businesses via Mailsort 3. Excluding the cost of design work this might cost £1700 at today’s prices for the print, folding, envelopes, postage etc. If the response rate is just 0.5% to 1% as has been suggested is likely then that means that the 25 – 50 enquiries will have cost £34 to £68 each.
If a pop up cube shaped pen holder was sent via Mailsort 2 to a well targeted audience of just 1000 businesses the cost of that promotion, excluding design costs, would work out at approximately £1850 – that £150 more than the cost as 5000 leaflets! However, if we take the lowest of the figures reported for dimensional mail – 7% – then the 70 generated enquiries will have cost just over £26 each. And there are at least 40% more of them than the 5000 leaflets managed to generate.
If we took the example of sending out equal numbers, that is, just 1000 of each type of mailer then the cost of mailing the leaflet would be around £700. That works out at a whacking £70 per enquiry!
At the end of the exercise, where is the leaflet? More than likely it is in the customer’s bin along with several other examples received in the morning’s mail. And the pop-up cube? Well, the cube was passed all around the office and now it is on your customer’s desk where it is likely to stay for the next 12 months or so. Now that’s cost effective!