Pure Plays in the Postal World – What to Know

More and more, we at CohereOne are engaging with companies who are new to the postal world. Many are running successful direct businesses by employing first class digital marketing and have experienced tremendous growth over the years. Eventually that digital universe tends to hit a wall, and no matter how much more money they throw in the marketing pool, they can’t seem to break through that ceiling, and growth starts to stagnate. That is when they turn to postal marketing to try to kick start the growth trajectory again.

This is a logical evolutionary step, and most (I emphasize most) of the time it is successful. The main reason is that postal marketing is proactive and intrusive. If you think about it, with the exception of email marketing, digital marketing is a passive strategy. It is reliant upon a consumer being actively searching, reading or browsing, in order to grab their attention and hopefully entice them enough to purchase. This is in contrast to postal marketing, where you are proactively reaching out into the consumer’s household and creating or inspiring the demand for your product.

One of the main hurdles for companies getting into the mailing world is cost. Direct mail is expensive, and anyone who tells you otherwise is lying to you! The performance of direct mail traditionally will far outweigh the cost, so as long as you can overcome that initial cost hurdle.  it will pay in the long run.

This past holiday season, one of our clients ROAS for every dollar spent on marketing, was $5.06 for their digital programs and $8.16 for their catalog program. When calculated as an ROI to account for costs, the digital programs ended up at $4.06 compared to the catalog at $7.16. While this company spent 5x as much on catalog marketing on the front end, it obviously paid off at the end of the season.

While the above example cites a catalog program, it is not necessary to join the direct mail universe with a full blown catalog. Smaller pieces such as oversized postcards (great for retail store drivers), tri-folds, digests, etc. can be just as productive at an ROI level.

Another challenge that can be experienced is timing. Digital marketers are privileged in that they can turn on a dime by adding, changing, revising, and deleting programs relatively quickly and easily without major consequence. This is not so in the direct mail world, since there are lead times that need to be accounted for on both the creative and audience creation side. Both work backwards from the date of delivery of the piece in the consumer’s mail box, more commonly known as the in-home date. The post office takes 6-9 days to deliver and the printer needs around two weeks for printing, binding and mailing. So both creative files and the mail files are to be delivered 3-4 weeks before the desired in-home.

To create the audience (mail file) inclusive of both buyers and prospects, the process conservatively takes about 2 weeks for the data house to hygiene, merge and create the files. Depending on who is driving the creative process and the complexity of the end product, this can take anywhere from two weeks to three months. So at a minimum there is a full 5-6 weeks in total that is needed before the in-home in order to execute a full blown catalog mailing. Smaller formats, such as postcards, can shrink this time line at both the creative and mailing level, but still requires a fair amount of time compared to digital programs.

One other critical decision in the process is what audiences will receive the mailing. The mailing can be used as further engagement with active customers, as a tool to reengage inactive customers, and as a prospecting tool to attract new customers, or all of the above. This goal determines the level of effort needed to put forth in the audience creation, which is the art form known as circulation management. There are many different sources of prospecting names, each with varying degrees of cost and effectiveness. Similarly there are different solutions and strategies available for the creating the buyer audience, again with varying degrees of cost and effectiveness.

This is where CohereOne’s expertise comes into play. We can help guide you through the process of launching into the direct mail world and set you up for success breaking through the digital ceiling that is suppressing your company’s growth trajectory.

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