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Measuring The ROI of Direct Mail

Mike Ertel

A recent article on CMO.com listed 15 surprising stats about CMOs. One of the most interesting pieces of information was, “CMOs find it difficult to quantify marketing return on investment (ROI). Nearly one in five score themselves as below average in multichannel attribution, correlating advertising to sales, and measuring media buying effectiveness.”

This was indeed a bit surprising to me. Whenever we’re talking to a senior marketing executive, we always explain that direct mail is the most consistent, proven and highly measurable channel available. Simply stated, it either pays for itself, or it doesn’t. Not many other channels can make a similar claim.

So what are the best ways to measure ROI? A few of the most common ways our customers evaluate the effectiveness of their campaigns include measuring:

  • Gross Response Rates
  • Conversion Rates
  • Cost per Lead
  • Cost per Acquisition
  • Lifetime Value

But in today’s cross-channel marketing environment, it can be difficult to determine which channel was most responsible for achieving the desired response. Many marketers struggle with this, and as a result, direct mail doesn’t always get the credit it deserves. There are certain tactics your direct mail piece can employ to help determine if it drove your audience to your intended message. These include:

  • A direct mail-specific or personalized URL (pURL) in your campaign
  • Unique offer codes or activation cues
  • QR codes or social media addresses
  • Specific 800-number for response

For further analysis, you may want to consider enlisting the services of a strong data and analytics company, such as DataLab, to help mine these types of response tracking.

Finally, a recent breakthrough in measurement is multivariate testing. This allows us to pinpoint the exact elements of a direct mail piece that drive the greatest ROI among key market segments. These elements can include the headline, offer, copy, call-to-action and creative (including the use of color) in a multivariate environment. For example, you may be able to determine that one market segment responds better to a direct mail offer that uses a pURL, while a 1-800 number on the exact same direct mail piece will get a better response from a different market segment. We’ve had tremendous success collaborating with clients to validate the impact unique elements of a direct mail campaign have on response rates. These include, but aren’t limited to, tactile features, package size and unique opening devices.

If you’re being challenged to quantify the ROI of your marketing efforts, or account for the effectiveness of multi-channel efforts, direct mail is still the king of measurement. If you’re not using direct mail to power your marketing, or your program is on auto pilot, come see how it has evolved. Four-color digital combined with complex data segmentation and innovative formats is achieving significant, measureable results.

link https://www.iwco.com/blog/2014/01/07/measuring-direct-mail-roi/
Mike Ertel


Mike Ertel

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