5 Ways to Get Out of Direct Mail’s Catch-22
Last year’s postal rate increase only sped up the minimization trend (vouchers and their ilk) among many direct mailers, who sought to lower their costs by downsizing their packages while hoping dearly that the response did not similarly shrink.
Unfortunately, however, it turned out many companies, publishers, nonprofits and the like that used direct mail were caught in a catch-22, where they felt that higher postal costs meant they had no choice but to cut their efforts down if they wanted to remain profitable; trimming those efforts then depressed response to such an extent that profitability was endangered.
“Minimization trends are nothing new,” says Pat Friesen, copywriter and owner of Pat Friesen & Co. in Kansas City, Kan. “Mailers that are true direct marketers are always looking for and testing ways to mail the most cost-efficiently without jeopardizing response. And now with higher costs, it’s another reason to test ... but [you need to] weigh the savings against response changes.”
For nonprofits, however, minimization is a more recent phenomenon, as charities, museums and foundations had relied on flats until the May 2007 postal rate jump. “They’ve taken a hard look at that massive increase and have been, in some cases, testing other shapes and types of mail to see what might work and how the response rate may change. And where possible, they’re converting to the smaller-size pieces, like letter-size formats, because of that extreme difference,” comments Anthony Conway, executive director of the Alliance of Nonprofit Mailers, based in Washington, D.C. Indeed, for the first quarter of this fiscal year, the volume of flat mail and general Standard flat mail dropped like a stone.
Along with traditional minimization approaches, here are five ways to remain a force in the mailstream, no matter what the size of the mail piece.
1. Weigh Postcard Potential
“One trend that has been building for quite some time is the use of postcards. Used appropriately (they aren’t very private and have space limitations), postcards can keep you in the mail and be effective,” says Friesen, who does warn that so many postcards are landing in the average mailbox now that standing out is becoming an issue.
Julia Thomas, president and creative director of Comma, based in Lansdowne, Va., and former corporate communications manager at National Public Radio, agrees that postcards are the postal choice du jour, but also issues some advice. “I tell clients that postcards are fine for lead generation and brand awareness. Not so good for making a sale directly from that mailing,” she relates.
2. Maximize the Minimal
The voucher. Love it or hate it, it still works and doesn’t show any sign of stopping, claims Paul Goldberg, a direct marketing consultant and owner of New York–based P-J Promotions Inc. However, while the voucher by itself was minimization begun many years ago, the so-called “hybrid voucher” certainly represents the opposite of the minimization trend. “We are beginning to see more and more ‘fancy’ vouchers and ‘hybrid’ vouchers, which shows a trend to adding more pieces to voucher packages, once again because they work,” says Goldberg.
3. Nonprofits: Coming Back Into the Flat?
Perhaps because the letter-size mailers have damaged response rates, Conway states that it’s undecided whether or not nonprofits will come back to the flat mailing. “Historically in the postal service, when a postage rate would increase and if a particular class or type of mail got a substantially larger increase than others, the volume for that product line drops out immediately. But then over time, it tends to regain itself,” he explains.
4. Ultimate, but Often Ineffective, Minimization: E-mail
“Honestly, the biggest minimization trend I’m seeing is a shift to more e-mail campaigns, particularly among B-to-B clients. E-mail can be cheaper, of course, but few companies are truly expert in e-mail marketing best practices and the online integration needed to really make it work,” asserts Thomas, who says that having an effective e-mail marketing program is not as easy as the technology makes it seem.
5. Finally, Stay “On Your Toes”
“In general, I think that increased production and postage costs keep mailers who are true direct marketers on their toes,” comments Friesen. So rather than jumping ship or focusing on cutting costs just to cut costs, she encourages mailers to use these challenges to make them mail smarter, look for ways to reduce wasted circulation (better targeting, cleaner lists), and keep testing and reading results.