How Well Does Your Direct Mail Campaign Work? How to Measure Success

A direct mail campaign is one of most cost-effective ways to market your business. According to a study conducted by the Direct Marketing Association last year, direct mail brings in approximately $10 in sales for every $1 invested. That’s a pretty good return on your investment, eh?

With everyone talking about high gas prices and how to save money, direct mailing is one of those ways your company can save money. The U.S. Postal Service is giving us a bargain, really, when you think of how much money you could spend trying to reach thousands of people in a week’s time. Compare that with the approximate $1 cost it takes to create and mail postcards and you’ve got yourself a deal.

The best way to measure success of a direct mail campaign is to measure the cost versus gain
ROI stands for return on investment. ROI is basically a measurement of how much money you made or lost on an investment. To calculate ROI, you use the following equation:

ROI = (gain from investment – cost of investment) / cost of investment

I won’t go into the particulars here, except to tell you that if you Google ROI you’ll get a lot more info than you probably wanted to know about ROI! It’s a popular buzz word when it comes to finances of any sort. Basically, ROI tells you how much money you made in a percentage format. Whatever your ROI number is in the equation above, multiply it times 100 and you’ll get a percentage. That percentage will tell you how much of your investment cost you got back.

Another way to measure your cost and gain ratio is to measure your cost-per-piece or cost-per-lead and compare that with your sales numbers that resulted from the direct mail.

Measure how well you’re doing with test mailings
Direct mail enables you to control your marketing efforts better than other forms of marketing. You get to decide who exactly sees your direct mail pieces, when they see it and what the direct mail piece looks like.

When you first develop a direct mail piece, you should send it to a small group of people on your mailing list to get a feel for your response rate. You can use subsequent mailings to try out a new design, new headline copy or try a new mailing list to see what works and what doesn’t.

By testing your direct mail pieces before you send them out to your entire mailing list, you can gauge the probability of success so you know how much money, time and effort to sink into the direct mailing.

How to Get the Response Rate You Want with Direct Mail

Direct mail marketing is one of the most difficult types of advertising because most people just throw the envelopes away. It is even more difficult when postcard marketing techniques are used because everything is visible to the eye right from the start. How economically feasible is it for companies to use postcard printing if no one is going to read what they send anyway? Weighing the potential success of either method depends on a number of factors including the product line the representative is attempting to sell.

After all, most people are not going to be interested in a product that is no different from what they can buy at their local store. In order to sell a prospect on what you are selling it must be different from anything else on the market or you must be able to convince your prospect that he or she must have what you are selling. That means you have to make them want to open their letter, and the easiest way to do that is to use only your name on the envelope and not the name of your company. You can also use personal information such as a birthday or anniversary to attract their interest.