Expressing an Offer
The editors of Inside Direct Mail had to look twice at an offer that arrived in March from financial services company Wells Fargo in a 9-1/2" x 12-1/2" United States Postal Service (USPS) Priority Mail envelope.
Although it is the real McCoy, a level of skepticism surfaced, for a popular tactic in direct mail creative as of late has been to drop oversized packages emblazoned with red, white and blue to resemble USPS flat rate envelopes. Such is the case with an effort launched last year by Parents Television Council, where the nonprofit tailored a package to look "express-like," with the outer envelope headline: ROUND-TRIP EXPRESS PAC.
The strategy employed here is to attract the recipient's attention with "urgent" messaging on the outer envelope. Now, consumers may be wise by now to faux express packages and fake USPS eagles, but there's no disguising this costly, genuine one sent out to current customers by Wells Fargo that indeed has an urgent message to share (535WELFAR0303B).
Aside from the wrapping, the effort is simple: a one-page letter and an 8" x 8-1/2" glossy insert that offers current customers a streamlined loan of $52,062 to refinance their current mortgage. Prospects have the option to accept a five-year term with a fixed APR of 5.65 percent (monthly payment of $998.05) or a seven-year term with a fixed APR of 5.75 percent (monthly payment of $754.33).
What makes Wells Fargo's use of the USPS Priority Mail envelope compelling is the overwhelming refinancing demand from consumers since the beginning of 2003. According to mortgage company Freddie Mac's weekly nationwide survey issued April 24, the average interest rate on a fixed-rate 30-year mortgage dipped to 5.79 from 5.82 percent the previous week.
According to reports, low borrowing costs continue to attract home owners who want to refinance their home loans, in particular borrowers who held off from refinancing in hopes of an even lower rate.
"Mortgage rates are still very low historically," Sung Won Sohn, economist at Wells Fargo of Minneapolis, told The New York Times in late April. "The recent small up-ticks don't matter that much. We are seeing some real demand from fence-sitters."
According to a report from the Mortgage Bankers Association of America published the week ending April 25, refinancings accounted for 68.4 percent of the week's business.
At press time, market watchers said improvement in consumer confidence (evident in recent reports) as the war in Iraq ends could support demand for housing and fan demand for refinancing and loans to buy homes.
What Wells Fargo has done here is take a very effectiveand expensivedirect mail creative format and use it to relay a time-sensitive and compelling message to its valued customers.