Direct mail marketing sees 3.1 percent growth after three-year decline

By: Lindsey Graham

Small businesses may want to put more of their business marketing efforts into direct mail, as the medium has recently witnessed significant growth after spending several years on the decline. 

According to a report revealed by the Winterberry Group, direct mail advertising sales saw a 3.1 percent increase in 2010, compared to its 20 percent decline from the three years prior. This figure is expected to increase further next year to 5.8 percent, Medill Reports noted, a boost that experts attribute to a rebounding economy.

“As companies see the economy turning around, they tend to increase their spending on marketing, because so many of them have cut back their spending during the recession,” Bob Lieber, CEO of marketing strategy and services firm Original Thought told the source.

This news could be beneficial to the United States Postal Service, which has been fighting to regain growth and draw in new direct mail advertisers via beefed up marketing and advertising campaigns.

According to the source, the rise may be due to the fact that many consumers’ email inboxes are filled with an overwhelming number of messages. Due to this, many opt not to open them and instead choose to delete them. Therefore, it may be easier to target consumers with a piece of correspondence that they can hold in their hands and interact with directly.

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Best Direct Mail Formats, Benchmarks and Personalization for Acquiring New Donors

New blood. Fundraisers are busy trying out non-direct mail channels (email, mobile, social media) in varying efforts to retain their current donor bases. But regardless of how successful these channels are for any nonprofit, you can only go back to the well so often.

In other words, the donor stock must be restocked for a nonprofit to survive today, and by far the best way to acquire new donors remains direct mail. That was the topic of the recent DirectMarketingIQ webinar, “Acquiring New Donors through Direct Mail: Best practices and case studies from leading fundraisers.”

Besides speaking during the webinar, Bob Merrigan—President of Merrigan & Co., a Kansas-City based firm specializing in strategy and messaging for non-profits—took time to answer many questions from attendees.

Here were a few highly relevant questions and answers:

Question: What is the best delivery for your direct mail piece? #10 envelope? Taped flier? Color? Plain?

Merrigan: Ask yourself, “How can I get attention in a way that sets the stage for for my ask, but doesn’t give the prospect an opportunity to say ‘no’ before being asked?”

There’s no single solution. I tend to prefer having the organization clearly identified; we all want open relationships … why would you start out as a mystery. I tend to prefer printing design/copy rather than leaving the envelope blank. That’s valuable real estate; you only have a few seconds to get attention and you need to use it. I like to invite (tease?) the reader into the package.

There are economic realities to deal with, too. Most acquisition efforts won’t support a closed-face, hand-addressed envelope, but that may work well with higher dollar donors. We’ve tested four color vs. two color. Four color typically gives a lift in response, but it really depends on your mail quantities and production capabilities. If I were starting out (not much reference in terms of return to expect) I would probably go with 2 color.

Similarly with self-mailers … I would start with a letter and flyer in an envelope and establish some benchmark patterns. Then I’d try to test in a self-mailer to see if the expected drop in response is more than offset by the cost savings.

Question: Can you provide “best benchmarks” on average cost to acquire a new donor, average cost to retain an existing donor, and average cost to convert (2nd year) across your NP clients? And you mentioned that the first gift amount is really important in the long term investment return. What did you mean?

Merrigan: First gift tends to be indicative of future gifts. It’s much harder to take a $5 donor to a $25 gift level than vice versa. The first gift tends to be indicative of the donor’s giving tendencies—not always, of course, but indicative.

Lifetime value is always going to be determined by average gift size x frequency x longevity. An effective fundraiser is going to establish benchmarks in each of those areas and constantly look for strategies to implement that could bump up those numbers.

Question: In your experience, is there a major difference if the letter is written in first person by the organization’s client, instead of written by the President/CEO?

Merrigan: I’m a huge fan of personalizing the organization … through its clients, through other supporters, through volunteers, through key employees. I would encourage you to collect and tell those stories in as many ways as you can.

That said, I’d ask myself before putting your cover letter over that signature, “Is this the most natural/comfortable way to make this ask?” It may be that the ED can tell the story of a client … or set the stage, include the client’s story, and then make the ask. It might be that the story is on a buckslip.

The key question is this: What is the “voice” that is most likely to elicit a response? The fact is, sometimes the president/CEO is not able to balance the need to maintain their personal voice and also be the voice of the organization.

Another consideration is how many appeals you are making. Do they all need to come from the same person? If your prospect is receiving multiple asks, it may make sense to try having some of them come from different people.

Ethan Boldt is the chief content officer of DirectMarketingIQ, the research division of the Target Marketing Group and publisher of special reports, how-to guides and books for the direct marketing industry

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Small Business Tip: Use Direct Mail Marketing to your Advantage

With the high cost of advertising, small companies need to uncover a way to sell their items or services in the most economical way doable. Direct mail advertising is the perfect advertising strategy for tiny businesses since of its affordability and effectiveness. Corporate stationery can be reproduced at a really reasonable price through letterhead and envelope printing services.

The purpose of direct mail advertising is not limited to just promoting your enterprise this strategy can also be used for the following objectives:

Brand Recognition: Sending your own organization stationery is much better than employing generic postcards for your marketing copy. Personalized stationery strengthens your branding efforts. Your corporate stationery contains your brand name, logo, and company colors. These branding elements assist consumers remember who you are. Guarantee brand recognition by placing your logo in a prominent location on your envelopes and letterheads.

Customer Loyalty: Direct mail advertising is a more personal approach for communicating with your customers. This builds customer relationships and increases consumer loyalty. Adding a individual touch to advertising is the greatest way to show customers that you value their enterprise. Send them direct mail in the course of the holidays or to just simply thank them for their continued support.

New Consumers: Your organization need to be able to extend its services to a new pool of customers to allow it to grow and expand. You can do this by asking for referrals or exchanging mailing lists with other companies. Gaining new customers not only rewards your revenue, it also increases your visibility.

Newsletters: Maintain your customers up-to-date with your new merchandise or services, sales, or new store openings. Doing so allows consumers to participate in your company’s milestones or take advantage of your special provides.  Maintaining visibility helps minimize competition.    

Whether you are utilizing direct mail advertising for promotions, news updates, or special greetings, often maintain in mind that your message need to be straightforward, concise, and total. This way you can be certain that you are communicating effectively. Lastly, you ought to be careful in choosing the right printing company to print envelopes and letterheads for your marketing campaign to guarantee high-quality.

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Premium Gifts – Quadriga Art International Sees Resurgence in Charities Using Premium Gifts to Drive Stronger Donor Responses

NEW YORK & AMSTERDAM–(BUSINESS WIRE)–At a time when the marketing industry for nonprofits is witnessing a convergence of direct mail and digital mail, Quadriga Art International (QAI) says the old practice of including a premium gift in a direct mail package is making a comeback. QAI – the leading marketing firm for nonprofits – says several organizations in Europe including UNICEF, Cancer Society, Care International, SOS Children’s Villages and Handicap International are all seeing higher response rates from using premiums.

“We are even seeing donors call the charity to thank them for the gift and ask for another one.”

QAI has seen premiums double or triple response rates and raise ROI simply because more people open the direct mail package with a smart gift seen inside and want to give to the charity.

“Getting donors to open a direct mail package is half the battle in a market that is flooded with direct mail and where charities keep mailing the same old mailings to the same old list with the same old results,” says Mark Schulhof, CEO of Quadriga Art. “Adding a smart gift such as personalized address labels, pin badges or cards not only gets the donor to open the package but we are seeing it add rather significantly to donor response rates and ROI. When people get a gift they feel more like giving one.”

QAI suggests charities be smart when using premiums. For example, the company says a charity should use a gift that is directly related or represents the nonprofit’s main mission which helps brand the charity. Schulhof also says a premium should be practical so that a donor can proudly use that gift which can further tie the donor to the charity’s mission. Such gifts could be tote bag from an environmental group produced from green materials or a stuffed animal from an animal rights group both of which have been receiving extraordinary response rates.

“Charities should feel good about the premium they choose and the cost of the gift and package and the extra cost of using a premium gift more than pays for itself due to higher giving rates and ROI from the direct mail package,” says Schulhof. “We are even seeing donors call the charity to thank them for the gift and ask for another one.”


Direct mail marketing bouncing back with economy

If it seems like your mailbox is brimming with direct mail advertising these days, you are not imagining things. After three years of declines, spending on everything from simple postcards to glossy brochures is rising.
“I’ve seen more large stacks of direct mail at my doorstep,” said Rachel Hambick, a 31-year-old resident of Chicago’s Rogers Park neighborhood. “There are a lot of them,” mostly from grocery stores and restaurants.

Direct-mail advertising sales rose 3.1 percent last year, a significant turnaround from the previous three-year drop of 20 percent, according to New-York-based marketing consulting firm Winterberry Group LLC. The firm is forecasting a 5.8 percent increase in direct mail spending for 2011.

Bob Lieber, CEO of marketing strategy and services firm Original Thought LLC, said the increase is due to the overall improvement in business conditions.

“As companies see the economy turning around, they tend to increase their spending on marketing, because so many of them have cut back their spending during the recession,” Lieber said.

Glenn Cummins, national marketing manager of Ed Bristol Advertising & Printing Inc., observed that business is definitely busier than it was last year. “More direct mail printing business is coming in because the economy is rebounding,” he pointed out.

The deep recession in the financial services industry contributed to the cuts in direct mail, but marketers and retailers also shied away from it in favor of digital media, especially email, according to Winterberry Group.

But Hebert Rivero, owner of Minuteman Press, argued that the pendulum seems to now be swinging away from digital marketing and back to snail mail.

“People are not opening their emails the way they used to, because there’s too many, so they just delete marketing emails pretty readily,” he said.

Hambick agreed. “The emails I’m signed up for, they seem to email me several times a week, which is almost too much. You become desensitized to it.”

Rivero believes that is one reason why his business is up. He noted that in addition to stronger demand for direct mail, retailers’ pursuit of higher quality paper also contributed to the bounce-back in direct mail spending.

“Our retailer clients have done a lot of homework to give their mailers a certain look so that people would be more likely to open [them] and look at their marketing products,” he said.

Rivero observed that spending on commercial postcard printing has experienced the biggest gain, followed by newsletters.

“We’re entering a period where inflation is going to start to set in and people are going to try to raise their prices as demand increases,” Lieber explained. “It will drive marketers to try to be more efficient, so they will try to make inexpensive formats successful, for example, the postcard mailing.”

After primarily distributing coupons and fliers to local residents’ mailboxes, Hassib Blan, owner of the Olive Mountain restaurant in Evanston, is investing in direct mail.

“The economy is getting better, so we’re also putting more money into advertising,” Blan said. “We want to get more people coming to try our food.”

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Direct mail still responsible for most charity donations

A new report has indicated that direct mail remains the source of most charitable donations, though it is important for non-profit organisations to embrace multi-channel strategies.

Developed by Blackbaud’s Target Analytics company, the study found that although multi-channel giving has become a common objective of not-for-profits, it is not yet being widely practiced.

According to the research, the only donors who do significant multi-channel giving are new supporters acquired online.

However, a large proportion of these donors were found to move across the direct mail giving in subsequent years, highlighting the importance of a multi-channel approach.

Rob Harris, Target Analytics’ director of analytic products, said: “The internet is becoming an increasingly important acquisition channel but has not proven to be as effective for retention.”

The study revealed that the majority of gifts are still received through direct mail. Donors acquired online were found to give much larger gifts but generally have slightly lower retention rates.

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Direct Mail Breakfast Tray Is “Toast” Of The Town

Direct mail was taken to a new level when Auckland marketing campaigners Mailshop sent breakfast trays to customers that included a printed piece of toast.

The Just for Starters pack — which won a Gold Medal in the Self Promotion Category of this year’s Pride In Print Awards — was the hero of the self-promotion campaign in which recipients received a personally-addressed box to peak the curiosity factor.

Upon opening they encountered their very own breakfast tray, personalised with their own fake newspaper (featuring them) and accompanying cereal, butter, jam and coffee cup. To further enhance the experience the toast was real Vogel’s bread (with “Mailshop” branded onto it) and the banana was a fresh mini Nino banana!

Recipients were directed to a personalised URL (PURL) with the invitation to enter a competition on line, offering a prize of a real breakfast at the Langham Hotel.

The germ of an eye-catching business-to-business mail campaign came when Mailshop moved premises last year and used the opportunity to refresh its visual identity through a logo rebrand. Dashwood Design worked with Mailshop and established a brand essence around the concept “no such thing as ordinary”. The change included a transformation of its website, a new business profile and new signage, stationery, email signatures and vehicles.

A campaign was then devised to showcase the capabilities of Mailshop’s latest Colour 1000 digital press, in particular the broad range of paper substrates and weights it could handle, and to demonstrate to clients what is creatively possible when utilising XMPie software, both online and in digital printing.

Mailshop Managing Director Deidre Ross says the desire was to surprise and delight clients and reinforce the “no such thing as ordinary” idea with a memorable cross-media DM campaign which recipients would want to keep and tell others about, creating conversations about Mailshop to their peers.

“The pack needed to be visually arresting with a high level of customisation and personalisation that would take clients’ breath away and showcase Mailshop’s prowess for detailed execution.

“Timing was critical to heighten the unveiling experience. As a result each pack was hand delivered to companies’ receptions as early as possible prior to 10.30am,” she says.

“The PURL was intended to be a quick and easy experience, a fun extension of the Direct Pack that enabled people to enter the draw and be re-introduced to Mailshop’s broader capabilities. This was subtlety referred to in the breakfast spread. No explanation was given but that did not stop 40% of recipients visiting it and as a result receiving an entry into the draw to win breakfast and a spa for two at the Langham hotel.

“Each pack had a lotto ticket nested into the mini newspaper. The ticket was an important part of the experience as the personalised newspaper showed the recipient being the Lotto ticket winner! It got people involved, they had to go and check it out – anything but ordinary!”

Recipients were high-value Mailshop clients, 120 in total. The mix was advertising agencies and direct marketing clients, chosen due to their activity in the creative direct marketing space.

The campaign resulted in comments such as: “WOW — what an amazing DM I received from Mailshop. Have been so impressed I’ve been showing everyone in the office. It’s great to see such innovation and something tangible in this eWorld we are now living in.”; “Got my awesome breakfast DM box yesterday! Everyone is talking about it around the office. Quick question, is the lotto ticket real?”; and “Thanks for the personalised breakfast box, fabulous! I love the newspaper and especially the lotto ticket inside!! Very clever!! I’ve just entered the draw, fingers crossed!”

Ms Ross says the campaign ignited many client conversations about what is really possible in the DM space and how the latest technology can deliver a more impacting experience that drives results.

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Four steps to follow when choosing a list

You can only go to the well so many times. Even the greatest campaign for the best product, with the most attractive offer and creative collateral, will fall flat if you’re not reaching high quality, new business prospects. If you’re seeing a decrease in response and an increase in opt-outs, your lists are probably oversaturated. You know you need fresh ammunition. What should you do?

1. Identify suitable brokers. Find brokers who manage files that match your desired target audience in terms of company size, industry, geography, desired type of contact, job title, function and purchasing authority of influence. Obtain counts from your identified brokers to determine if their counts support the mass volume your b-to-b marketing program requires. Match rental options, including email, direct mail and phone, to your go-to-market strategy. Determine how the brokers’ lists are collected.

2. Test their lists. Tell the data list manager upfront that you intend to run competitive tests before agreeing to a long-term purchase agreement. Agree to terms, and then select three lists that match your criteria. Provide the broker with a list of the types of people you do not want in your target audience.

3. Measure results. Remember that even respondents who aren’t interested are valuable. If your list does contain the right people, you may just need to reach them in a different way or with a different business offer.

4. Select your vendor. Once you’ve aggregated the data, you’ll have a solid foundation for making your selection. Monitor your ongoing response rates to gauge how effectively the list company invests in continuously cleaning its files. If you see diminishing returns from your list purchase, I recommend 
repeating tests and your selection process annually.

From the June 01, 2011 Issue of Direct Marketing News

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USPS searches for more advertising mail

The US Postal Service literally guaranteed the effectiveness of integrating direct mail into marketing campaigns when it launched a postage-back assurance program in mid-May to attract the business of large marketers. The USPS is conducting the “Mail Works Guarantee” to convert large advertisers into direct mail marketers and to counter the large yearly drops it is seeing in First Class mail.

“Direct mail is the most effective and measurable way to get a message to consumers, and we know it won’t automatically go to a spam folder,” said Susan Plonkey, VP of sales at the USPS. “Of course, a direct mail piece is only as good as its offer and targeting.”

The USPS will use its experience to advise brands on how to effectively include mail in their marketing mix but will not assist with metrics or branding advice, she adds.

“We assume companies will already have very solid metrics in place to determine success. What we believe we can do is improve the performance of that campaign with direct mail. We also assume companies have determined the right brand message,” said Plonkey. “With our years of experience, and our vast amount of data on the effectiveness of direct mail and our knowledge of how to improve the read and response rate of direct mail, we believe we are uniquely positioned to help companies incorporate direct mail into their advertising mix.”

The USPS has declined to name the large brands that are participating in the program, but the program’s parameters say each must spend at least $25 million annually on advertising and mail between 500,000 and 1 million pieces of Standard or First Class mail yearly. The Postal Service will refund up to $250,000 in postage costs if their mail campaigns don’t meet agreed-upon expectations.

Industry experts say direct mail still adds a vital element to most campaigns, despite the fact that many brands have moved a significant amount of their spending to digital.

“In many cases, there’s only a 20% click rate with digital,” says Russell Kern, founder and president of The Kern Organization, a direct marketing agency. “What about the other 80%? Digital is faster and less expensive, but single-channel marketing isn’t effective for any brand. When you lose mail, you close a door.”

However, Jeff Hassemer, VP of product strategy for the data management services group at Experian, notes that the integration of marketing campaigns has hurt direct mail in recent years as brands have moved spending to other areas. For that reason, the initiative will likely not turn many major advertisers into direct mailers, he adds.

“They have not reduced volumes because direct mail on the whole was not working for them, they reduced mail volumes because they are achieving a greater return on investment from the combination of direct mail and additional marketing channels,” says Hassemer. “In the end, a company will maximize its marketing investment across all channels. Direct mail was king of this for quite some time, but marketers are now focused on maximizing budgets across all marketing channels based on return alone.”

New Research Finds that Integrated Direct Marketing is Essential for Maximizing the Long-term Value of Online-Acquired Donors

May 31, 2011 (Business Wire) — Blackbaud (Nasdaq: BLKB) today announced the publication of the 2011 donorCentrics Internet and Multichannel Giving Benchmarking Report, which features research on nonprofit online giving in the context of an integrated direct marketing program. The Report also includes an extended analysis on the value of multichannel giving.

> View the full Report at

Developed by Blackbaud’s Target Analytics company, the Report finds that although multichannel giving has become a popular objective of nonprofits as a way to build constituent support, it is not widely practiced. The large majority of donors give through only one channel and use only direct mail as their vehicle for donations. According to the Report, the only donors who do significant multichannel giving are new donors acquired online. Large numbers of these donors switch to direct mail giving in subsequent years. This is the group of donors for which multichannel giving is crucial for garnering repeat gifts and realizing true long-term giving potential.

“The Internet is becoming an increasingly important acquisition channel but has not proven to be as effective for retention,” said Rob Harris, Target Analytics’ director of analytic products and a co-author of the study. “It is the ability of online-acquired donors to use another channel – that is, to start giving through direct mail – that significantly boosts the long-term value of this group of donors. The most successful organizations have integrated online and offline marketing teams and CRM systems to develop effective multichannel communication strategies that can maximize donor value.”

The research also finds that for donors already on file, evidence of past multichannel giving is not a predictive factor for future retention or long-term value. Traditional direct marketing segmentation variables such as recency, frequency, and gift amount are far more predictive.

Other key findings about online donors include:

> The majority of gifts are still received through direct mail, although it has become increasingly common for new donors to give their first gift online.
> Online-acquired donors are significantly younger and tend to have higher household incomes than mail-acquired donors.
> Online-acquired donors tend to give much larger gifts but have slightly lower retention rates than mail-acquired donors.
> In aggregate, online-acquired donors have much higher cumulative value over the long term than traditional mail-acquired donors. However, long-term value varies depending on the donor’s origin gift level, and the substantially higher gift amounts given by online-acquired donors can mask issues with retention.

The data presented in the Report comes from the most recent transactional data available for the 28 organizations participating in Target Analytics’ donorCentrics online benchmarking service in 2010. The organizations that participate in these online benchmarking groups are prominent national nonprofits covering a range of sectors, including animal welfare, the environment, health, human services, international relief, and societal benefit.

The complete analysis, including a list of participants in the 2010 online benchmarking groups, can be found at

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