DMA Releases 2010 Response Rate Trend Report
Yesterday, the Direct Marketing Association (DMA) today released the 2010 Response Rate Trend Report, which provides key cost and performance benchmarks to help marketers gauge the efficiency of their campaigns. The updated report shows effective paid search campaigns usually lead to a multi-step sales process.
This year's updated edition reflects the breadth of today's landscape with full coverage for five media: Direct Mail (five formats: letter-sized envelopes, postcard, oversized envelopes, dimensional, and catalog); Email; Paid Search; Internet Display; and Telephone. It also contains additional data on Mobile (SMS and Display); DRTV; DR Radio; Magazine and Newspaper Space Advertising; Inserts; Fax; and Digital Out-of-Home.
Where possible, the overall data is broken down for direct order versus lead generation, B-to-B versus B-to-C, and new this year, average sale size of less than $1,000 versus $1,000 or more. This year's report covers ten industries: B-to-B Services; Consumer Packaged Goods; Education; Financial Services; Health Care & Pharmaceuticals; Nonprofits; Publishing/Media & Entertainment; Retail; Technology & Manufacturing; and Telecom & Utilities.
DMA's Response Rate Report Trend Report was conducted through a survey that was emailed in March and April 2010. When the survey was closed, DMA had received 473 usable responses.
"The report gives marketers a context for response and cost metrics, letting them measure their campaigns against industry averages — an invaluable source when looking to benchmark campaign performance," says Yory Wurmser, DMA research manager. "In contrast to the goals of campaigns in many other media, paid search campaigns mostly urged respondents to get more information, either via a website or by consenting to receive free materials. Only 30 percent of campaigns had the intent of a direct sale, compared with 38 percent of email campaigns, 45 percent for mobile campaigns, 50 percent of direct mail campaigns, and 55 percent of telephone marketing campaigns. Therefore, paid search ads are a great way to drive traffic to your website; and when a paid search ad is clicked on, it usually leads to a two- or three-step sales process."
Key findings included:
- Email to a house list averaged: a 19.47 percent open rate; a 6.64 percent click-through rate; a 1.73 percent conversion rate; with a bounce-back rate of 3.72 percent and an unsubscribe rate of 0.77 percent.
- Response rates for Direct Mail have held steady over the past four years. Letter-sized envelopes, for instance, had a response rate this year of 3.42 percent for a house list and 1.38 percent for a prospect list.
- Catalogs had the lowest cost per lead/order of $47.61, just ahead of inserts at $47.69, email at $53.85, and postcards $75.32.
- Outbound telemarketing to prospects had the highest cost per order or lead of $309.25, but it also had the highest response rate from prospects of 6.16 percent. The highest response rate for a house list was also telephone, at 10.41 percent.
- Paid search had an average cost per click of $3.79, with a 3.81 percent conversion rate. The conversion rate (after click) of internet display advertisements was slightly higher at 4.43 percent.
- Response rates for B-to-B campaigns were generally higher than for B-to-C campaigns. Lead generation and high-end average sale campaigns also had higher response rates.
- Nearly 60 percent of direct mail campaigns in financial services aimed to produce a direct sale. The average response rate was a comparatively low 2.66 percent to a house list and 1.01percent to a prospect list.