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Education Loan Lenders

Direct Mail Moves to the Head of the Class for Education Loan Lenders

Michelle Peel

Financial aid, education lending, student loans—all rely on direct marketing to communicate educational funding options to students. As the parents of two pre-teen daughters, my husband and I focus a lot of our financial planning energies into helping them afford college. Student loans are becoming a more important piece of the college finance puzzle. Here are some statistics that document the growth in the student loan market in recent years:

  • $1.41 trillion: total U.S. student loan debt
  • 2 million: Americans with student loan debt (approximately 70% of college students)
  • $37,172: average student loan debt for a graduate of the Class of 2016
  • $351: average monthly student loan payment (for borrower aged 20 to 30 years)

With the cost of college continuing to grow, educational loans may be unavoidable. Educational lenders are looking for opportunities to prove to consumers that they make it financially easier to go to college and make loan repayment less challenging.

Direct Mail Helps Communicate Options to Students and Parents

When education lenders need to communicate options for educational funding and loan repayment to prospective borrowers, they turn to direct mail. Annual direct mail volumes from educational lenders have increased substantially in recent years—by more than 126.8%—from 87 million pieces mailed in 2014 to 197 million pieces mailed in 2016, according to Comperemedia. Q2 2016 had the highest mail volume in the year totaling more than 75.8 million pieces.

Although there were 37 lenders identified as marketing educational loans, the top five users of direct mail for educational loans accounted for 96% of the total educational lending direct mail volume. These lenders were Citizen’s Bank, Discover, Liberty Bank, Sallie Mae, and SoFi.

Loan repayment consolidation options were promoted by almost 40% of educational lenders. The top five lenders, mailing 93.38% of direct mail for the consolidation of educational loans, were Citizen’s Bank, Darien Rowayton Bank, Liberty Bank, SoFi, and SouthEast Bank.

While acquisition direct mail offers were sent to all age categories, not surprisingly, nearly half of these offers were sent to recent high school graduates or their parents. Individuals ages 50–60 received 27.10% of the offers, followed by individuals ages 18–30 who received 21.54% of the offers.

Direct Mail is a Powerful Tool to Use When Marketing to Millennials

According to an InfoTrends study, millennials are most likely of any generation to read direct mail:

  • 66% of millennials open direct mail.
  • 63% of millennials who responded to a direct mail piece within the past three months made a purchase.
  • 67% of millennials prefer receiving information via physical mail than email.

Millennials prefer direct mail and, combined with digital channels, it works.

Direct Mail and Integrated Marketing are Uniquely Positioned to Support Education Loan Acquisition Efforts

Education lenders are using direct mail to drive applicants to other marketing channels such as their website. IWCO Direct developed a few best practices to consider for creating successful direct mail campaigns specific to this growing vertical:

  • Highlight your offer and call to action. Fast results and costs savings are strong offers currently being used by top educational lenders to attract potential applicants. Place the offer and call to action in multiple areas on the mailpiece. Use the side bar and the P.S. areas on the letter to feature the recipient’s offer.
  • Consider using a comparison chart to illustrate the benefits of working with your company compared to other educational lenders.
  • Use a “pre-selected” check in the dollar amount of the potential educational loan. A website or toll-free phone number make it quick and easy for potential applicants to get in touch or learn more about the educational loan offer.

Get educated! Our direct marketing experts can help lenders increase the results of your education loan acquisition efforts. Contact us today!

link https://www.iwco.com/blog/2017/04/12/direct-mail-marketing-education-loans/
Michelle Peel

Author

Michelle Peel

Marketing and Corporate Communications Manager and graduate of Elizabethtown College. Bringing the “make it happen” attitude to IWCO Direct for more than six years and the direct marketing industry for more than 20. Favorite recognition: When her daughter was asked in school what she wants to be when she grows up, she responded, “Just like mom.” Pittsburgh Steelers fan who enjoys Zumba, dancing, shopping and spending time with family.

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