Calculate Your Direct Mail Response Rates Before Saturating The Market

Business owners of all different types of companies are always looking at the most lucrative, effective and cost efficient method of marketing to gain new customers and increase repeat business, and direct mail is a method that has been used time and time again. The question is, how effective is it? Most people who get advertising in the mail throw it out and those who keep it and then put it to use often make up a small percentage. However, if that small percentage each buys a car, then the direct mail response was still positive. You need to analyse the percentage of direct mail fulfillment necessary to make this method of marketing profitable, and if you discover that your direct mail response rate is too low, then it is time to consider a new technique. In other words, if not enough people read your ad and buy what you're selling, you'll need a new strategy.

Direct mail advertising services do not have to be costly, but they do need to be professional, so simply photocopying mailers and handwriting your own envelopes may give the wrong impression and actually be counter-productive. Thus, depending on the size of your direct mailing list, there is a monetary and time cost to setting up a direct mail campaign. With the resources you need to dedicate to this method, you need to be able to calculate your direct mail response rates to see if it will be worth your time or if the success will be too low to be profitable. Direct mail response rates vary, with an average of about 1% for new customers and 2% if you are advertising to existing customers. However, some new businesses get started with only a .2% success rate, and by the same token, others have reported as high as 2.6-3% response rates. These rates represent a large difference in business, and if your business is selling large goods at high prices, a low response rate is still profitable, but if your business is to sell stationary and discount prices, anything less than a 2% response rate will be a loss of money.

In order to increase your direct mail response rate, many people recommend to target your campaign to a smaller, more specific group with the precise needs that you can supply for. Also, instead of launching one large campaign to a wider target audience, launch repeat campaigns always to the same small group. The repeat advertising has a very positive effect and works much like a TV commercial that you can't get out of your head. Your technique could also be as simple as including a response postcard, and making the ad look less like junk mail by either handwriting the address or using real stamps. Strategizing this way will help your direct mail response rates and make your marketing campaign successful.

Any marketing campaign is only as successful as its response, and direct mail response is especially important because it can be a large waste of time and money if you don't calculate your response rates. If however, your response is positive, it can be a fairly cheap and easy way to reach new business.

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