The Department 3 Blog

Thanks to Direct Marketing Data, Direct Mail is Thriving

October 28 2018, Michael Concannon

Department 3 Resouce

With the advent of email, mobile marketing, social media, and any other new marketing channel you care to name over the past 10-20 years, many keep repeating that direct mail marketing is doomed.  That’s far from true, and direct marketing data has a lot to do with it.

Direct mail marketing is not only very much alive, it also performs very well across all age demographics. That’s especially surprising when the pervasive image of Millennials, Gen Ys and below are of people immersed in their mobile devices.

As this post by Shana Richardson at Credit Union Times points out, much of the credit for that goes to what she describes as “evolving targeting techniques,” which is why, as she points out:

About 75% of households at least scan direct mail advertisements, per the U.S. Postal Service. Direct mail has the higher response rate compared to digital methods.

Also cited? A figure from the DMA Response Rate Report 2016 about how financial services companies are the highest users of direct mail; it’s employed by 71% of banks and credit unions.

This requires them to be strictly on-message, have the right message for each separate audience, and have the creative and engagement hooks that work for that audience…all while maintaining regulatory compliance. That can be a tightrope walk in such heavily regulated segments, but 46% of the firms in the DMA study were still planning to maintain existing direct mail levels, while another 35% were going to actually increase those programs.

Direct Marketing Data Direct Mail

Younger targets love a direct approach

Direct Mail Response Rates by Demo

What’s proven extraordinary is just how well direct mail marketing succeeds with these purportedly jaded younger segments. Another survey found that 62% of consumers aged 25-34 had responded to a direct mail piece within the last month – the highest share among all age segments.

This may be due to their distaste for digital advertising. HubSpot has reported that 87% of consumers think there are generally more ads than 2-3 years ago; 91% feel they’re more intrusive. Pitney Bowes has found 73% of consumers prefer direct marketing to mobile.

The tactile, hands-on (literally!) nature of direct mail works in its favor with younger consumers who seek “authenticity.”  Digital messages can be fleeting, swiped away or adblocked out of their awareness. But a well-produced direct mail vehicle demands longer interaction, offers more potential opportunities to engage within the same package, and sticks in memory far longer.

For financial services firms, they display their authenticity by putting a direct mailer in people’s hands that supports important brand attributes – it offers physical proof they’re established, substantial, dependable. This makes an unconscious connection with consumers, as the Credit Union Times article points out:

(A) USPS study used eye tracking, biometrics and functional MRI technology, and found physical ads triggered activity in the ventral striatum area of the brain, which is responsible for value and desirability and can signal a greater intent to purchase.

Bangor University’s Centre for Experimental Consumer Psychology took it a step further, actually using MRIs to map how physical media experiences were more likely to become part of a consumer’s memory.

It’s what’s called “embodied cognition.”  The more senses we can engage, the more firmly a message is lodged in the consumer’s awareness, driving up response.

So direct mail can help overcome a must-win challenge in marketing to younger audiences, who demand your message be relevant and truthful. Understanding what they consider relevant and truthful, though, means being able to deep-dive into direct marketing data.

Direct marketing data makes direct mail meaningful

Research by the USPS discovered that Millennials spend more than 9 minutes per day sorting through their mail. That’s more than any other generation. They also spend more time scanning, reading, and organizing “snail mail.” Other insights?

  • 50% said they look forward to seeing what’s in their everyday mail, and value the time they spend scanning and sorting it.
  • 83% still use hard copies of bills for bill management, though they prefer making actual payments online. 
  • 54% wish they’d get more direct mail from area businesses so they can stay informed about what’s available in their neighborhoods.
  • 90% of Gen Ys feel direct mail is reliable, another study found, and 87% like getting information and offers from retailers in the mail.

A direct marketer can combine macro insights like these with more precise insights about target segments, mined from highly optimized direct marketing data. The result? The marketer can be far more accurate in delivering relevant and resonant messages and offers. The better-optimized the data, the more accurate the targeting, and the better the ROI you see from a direct marketing campaign.

The better-optimized the data, the more accurate the targeting, and the better the ROI.

One example? Online browsing behavior can be used to drive personalized direct mail via variable printing. Let’s say a young husband or mother browses an insurance company’s site for annuity policies to help fund their child’s college education; they can be targeted with a proper follow-up mailing about the specific instruments they showed interest in.

That’s exactly what’s driving the continued success of direct mail marketing: An understanding on the part of savvy marketers of the real power of quality data to empower engagement. Every audience appreciates relevance and personalization, not just younger ones, and good direct marketing data helps open that conversation.

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