• by Ray Schultz , Columnist, January 27, 2023

An imposing 74% of marketers agree that direct mail delivers the best RIO, response rate and conversion rates of all channels, according to 2023 The State of Direct Mail, a study by Lob, working with Comperemedia.

That may be why 58% are increasing their direct mail spend this year, with 16% significantly increasing it. Indeed, most firms devote up to 25% of their marketing budgets to direct mail. 

But it does not stand alone. Of the firms polled, most use email along with direct mail — by a wide margin over other channels. They utilize: 

• Email — 72%
• Paid Social — 46% 
• National TV — 34% 
• Newspaper & Magazine — 31% 
• Podcast — 25% 
• Organic Social — 21% 
• Earned Social — 19%
• None—it is used as a stand-alone tactic.  

Moreover, email and direct mail are often connected in the workplace. Responsibility for direct mail campaigns falls on:

• Dedicated marketing manager/team that owns direct mail — 34% 
• Owned by email/digital marketing teams — 29% 
• Customer/retention marketing teams — 15%
• Growth marketing teams — 11% 
• Individual campaign managers/teams — 10%

In addition, use of automation for direct mail is highest when the email/digital team is in charge. The automation rates are:

• Owned by email/digital marketing teams — 38% 
• Dedicated marketing manager/team that owns direct mail — 31%
• Customer retention marketing teams — 18% 
• Individual campaign, managers/teams — 9%
• Growth marketing teams — 4% 

That last point is critical, given that only 40% of marketers use a technology platform to execute direct-mail campaigns. 

What’s more, 66% of direct-mail senders are unable to measure ROI, leading one to question whether snail mail really delivers the highest rate of all channels. 

How do firms measure direct-mail ROI? Those that automate their direct mail track: 

• Individual customer activity within a specific time period — 52% 
• QR code — 55% 
• Personalized URL — 52% 
• Orders for featured products/services — 47% 
• Coupon code — 37% 
• Dedicated phone number — 46% 
• Generic URL — 28%

Except for Generic URL, for which the sides are tied, non-automated firms are far less likely to use these metrics. 

Direct mail suffers from these challenges:

• Poor response rates—36% 
• Bad address data—32% (Up from 25% in 2022)
• Budget constraints—26% 
• Lack of personalization and customization — 25% 
• Inability to verify addresses — 24% 
• Creating a compelling offer — 22%
• Inefficiencies and/or redundancies — 20% 
• Lead and production timelines — 19% 
• Workflow complexities — 17% 
• Inability to target campaign delivery times — 16% 
• Limited bandwidth — 14% 

Predictably, retention campaigns are the most popular and effective: Companies use direct mail for: 

• Customer retention — 30% 
• New customer acquisition — 28% 
• Customer advocacy/referral — 21% 
• Dormant/win-back — 20% 

Lob partnered with Comperemedia to survey 250 professionals who work in firms with +1,000 employees.