So, you’ve invested your precious time, energy, and money into a direct mail marketing campaign, and now all you can do is go back to business as usual and hope that you eventually see a return on that investment, right? WRONG. Tracking and measuring the success of your direct mail campaign is essential in ensuring that your money isn’t being wasted on ineffective marketing. Direct mail is basically a hit-or-miss marketing strategy and its results are relatively easy to measure if you have taken the proper steps while creating and preparing for your campaign. Before you embark on your next direct mail campaign, take a look at these tips and consider how you will measure your results.
1.) Planning a Strategy
There are several tactics you can employ to strategically collect results and accurately attribute sales to your marketing campaign. This generally means crafting your campaign so that its responses are somehow unique and identifiable to you. Some common examples are:
- Unique promo codes: Giving your campaign its own unique promotional code ensures that you know exactly how many sales resulted directly from the campaign.
- Campaign Dedicated 800 Number: Give your campaign it’s own 800 number for customers to call instead of having them call your business’ primary phone number. If you decide not to use this strategy, at least inform your sales or customer service representatives of the campaign and any promo codes involved, and get them set up with a means to record the campaign’s results.
- QR Codes: Putting a QR code on a direct mail piece is a great way to get the reader onto your website without any struggle. Combine this strategy with a personalized URL or campaign-specific social media page to maximize measurability.
2.) Interpreting Your Results
You ran your campaign, the numbers came pouring in, and you collected all the data that you could to measure your results. Now, it’s time to figure out what those numbers mean. Here are some things that you can do to make sense of your campaign’s data:
- Determine Response Rate: Response rates are important statistics in determining the effectiveness of a direct mail campaign. To find yours, multiply the number of responses generated directly by the campaign (sales made using your unique promo code, etc) by 100. Then, divide that number by the total number of mailers sent out. For example, if your campaign sent 5,000 mailers and got 37 responses using the promo code, your response rate is .74%. For reference, the most recent data on direct mail response rates indicates that the average rate for in-house lists is around 5.3%, and between .7% and 1% for prospect lists.
- Calculate Conversion Rate: Conversion rate refers to the percentage of responses that actually turn into sales. Response rates are great, but to really see how you are getting your ROI, you need to find out how many responders actually spent money on your product/service.
- Measure Cost per Acquisition: Cost per Acquisition (CPA) is the term for how much money you spent on marketing per sale generated by the campaign. Start with the total campaign cost. Then, find the actual number of sales generated by the campaign (this is essentially the conversion rate as a concrete number rather than a percentage.) Divide your total marketing cost by that number to calculate your CPA. For example, let’s say you spent a total of $3,300 on your campaign. You sent out 5000 mailers, 37 responded, and 15 of those responders were actually converted into sales. Your CPA equation would be $3,300 / 15 = $220. This means that you are spending $220 to acquire a new customer via your marketing campaign. Keep in mind that lifetime customers could generate thousands of dollars in sales for your business once acquired; it varies from business to business. You should set a goal for your CPA before you run your campaign based on how much you are willing to spend to acquire a new customer and adjust your future campaigns to meet that expectation.
3.) Moving Forward
Now that you’ve planned a direct mail campaign that strategically tracks its own results, recorded the data, and interpreted your findings, you are in a much better position to move forward and improve your next campaign. Marketers are using all different kinds of channels, but direct mail remains one of the most measurable. Don’t go into your next campaign blind; make sure that you have implemented tactics that will help you measure your success and use the information you’ve gathered to change what needs to be changed. Find out what works for your business and never stop improving your marketing.
At Plum, we specialize in innovative direct mail marketing techniques that are sure to drive up your sales. If you need some extra help planning your next direct mail campaign, you can find plenty more tips, tricks, and guides on our blog! Still don’t know where to start? Your Plum marketing advisor can help you determine your campaign’s needs and develop a plan of action that best suits those needs. We can also help you with cutting edge website development to create a stunning website for your business or for your campaign! Give us a call at 1-800-992-9663 to get started on a cost-effective direct mail campaign, guaranteed to generate responses.