Direct mail overheads are, typically, a huge topic of interest for Heads of Marketing and Business Managers.
It’s no wonder, at between 65%-75% of total cost per item for a C5 mailer with letter, form and business reply envelope; it is a large expense. Naturally, any advice on how to reduce this significant your direct mail costs is welcome. As a mailing house, with years of experience under our belts, we’re sharing our top tips for keeping your direct mail postage bill under control.
Most marketers know of data segmentation. However, it’s staggering how many still do not put it into practice – especially when it can radically reduce direct mailing overheads. By segmenting customer and prospect data, and prioritising it based on its propensity to convert and value per conversion, you ensure the most effective data for any campaign. You are placing your services in front of the correct people, thus using the mailing house and their offering efficiently. The knock-on effect with a mailing company (should you outsource) is that you also only pay for the direct mail postage and packs that are most likely to be successful. You’re winning back budget before your campaign is even mailed. This should be considered, in particular for B2B direct mail.
Mailing companies and Royal Mail reward marketers and business managers who pre-sort their direct mail campaigns. As a mailing house, we offer direct mail data services, but it does save office working hours and resources if done prior. You should always ask whoever provides your mailing services to sort any mailing over 4,000 items by postcode, or the postcode sorting sequence, in the most suitable manner that saves you the maximum budget. If you are using an external provider, such as a UK mailing house, remember to ask for this saving when you request a quote. Not all providers will pass it onto you as standard, and you should look to keep costs low where possible.
As you would expect, data accuracy is vitally important to the success of any direct mail campaign. However, many many mailing lists we see where the data is inaccurate – wrong streets, house numbers etc. – is costing both the direct mail build and the postage cost. If you are looking into direct mailing to communicate with your consumers – such as with B2B direct mail – you need clean and clear data. It will only serve to enhance your campaign, and allow the mailing house to produce successful direct mailing.
It is rare that data is perfect. As a rule of thumb, a direct mail campaign should have less than 5% Postal Returns. These direct mail returns can be due to an incomplete address, addressee unknown etc. Every single issue you can whittle out of your data before you go to a fulfilment house means more money saved in your marketing budget. If you’re having trouble filtering your data internally, the best direct mail companies will be able to provide this as a service for you. At WDM, we are a mailing house that can arrange your data, as well as direct mail design. We also offer a range of direct mail printing services to ensure your campaign is as successful as possible. We have even outlined the advantages of outsourcing to a mailing house with our relevant post.
Royal Mail, and other Downstream Access providers, such as Whistl or UK Mail, use size guides to regulate their pricing structure. This means that when you are planning your direct mail marketing and looking into direct mail services, you might want to consider using conventional letter and parcel shapes to keep costs low. Unusual shapes tend to fall into the larger shape bracket and costs increase substantially. This is not to say that you should never use unusual shapes, as the increase in response rates can sometimes outweigh the disadvantages of the costs. However, if cost is a large factor, you should be aware of the price range for different sizes.
In general, no matter what direct mail marketing you do, size has an enormous impact on your costs. The smaller the marketing direct mailer, the lower the mailing or postage costs will be. Our Marketing Manager’s rule at Washington Direct Mail is simple: “say what you need to say in as few words as you need to say it”. You have only a few seconds to catch your consumers’ attention, so don’t waste it. Taking advantage of the services of a mailing company can be a huge benefit, as they’ll be able to suggest ideas for your direct mailing. They will also recommend a proven font size. Most mailing companies use, at least, 11 point type.
As size can affect direct mail postage, so can weight. Mailing houses, marketers and business managers will be charged more for mailing heavier items. You should have an idea of what you are prepared to pay and make a judgement about weight versus the likelihood of response. If you do choose to lower your direct mail postage costs, take care to not detract from the effect of your direct mailing. There are numerous cases of letters on tissue-thin paper stock, and one-piece mailers created to save postal costs that, subsequently, boast poor response rates. Strike a good balance between minimising your budget and maximising your ROI. Again, this is where you could take the advice of an experienced mailing company.
Direct mailing services and mailing houses can access new customer offers with large reductions in postage costs. Although, these do come with an element of ‘do it yourself’ – hence the discounts – they can be a great introduction to direct mail marketing. For instance, if you have never used direct mail marketing and cannot gauge the likely impact, you could sign up to these lower tariff postage offers. In turn, you can run a series of mailing tests to establish response rates and to evolve your messages. Therefore, when you do produce your imagined direct mail marketing campaign, you are doing so correctly.
If you have done all of the above and believe you are producing the best direct mail, it’s safe to assume you are paying lower direct mail postage costs. You can then increase the volumes you are mailing out. Make sure you ask for a discount in return for your commitment.
Our direct mail services and points will help significantly reduce your direct mail costs and overheads. And, in an age when every potential customer is in email overload, direct mail is again coming into its own.
Washington Direct Mail Limited (WDM) have been in the UK mailing house business since 1983. There’s not much we don’t know about cutting direct mail overheads, tweaking direct mail response rates upwards and striking the right balance between campaign success and restricted budgets.
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