Commentary

It Takes Two: Study Touts Direct Mail, But Adds That It Works Better With Email

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.  

 

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