Personalization, Omnichannel Strategies Drive 2020 Direct Mail

AccuList’s direct mail marketing and mailing list clients embrace a channel that, despite perennial death notices, continues to outperform in terms of response, but mailers must also rely on evolving strategies for success in 2020.

2020 Success Depends on Data-Driven Personalization

Research consistently shows that personalization bumps up response. Most recently, in a 2019 NAPCO Research report on direct mail personalization, 44% of respondents saw personalized print marketing campaigns increase response by 16% on average, while Canon Solutions research found that adding a person’s name and other personalized database information (along with using full color) can increase the response rate of direct mail campaigns by up to 500%! So it’s no wonder that the recent Printing Impressions article by senior editor Toni McQuilken cites a number of leading marketing and print industry leaders stressing that data-driven personalization is the route to 2020 direct mail success. For example, Maureen Powers, president, Direct Marketing Group at RR Donnelley, asserts, “Personalization is more important than ever before, including with direct mail…We are using the direct mail channel to drive the customer experience through communications such as coupons and personalized offers. We’re also changing how we help our clients message their clients based on individual customer preferences and their point in the customer journey.” Likewise, Jim Andersen, executive chairman of IWCO Direct, stresses the shift toward variable data printing of smaller runs of targeted, personalized direct mail with digital tie-ins: “Today’s direct mail is more effective, relevant, and timely thanks to more sophisticated audience selection and segmentation. This technology uses digital print to personalize every component of a mail piece, including letters, inserts, cards, and call-to-action reply devices that connect the physical mail to an online, digital marketing experience.” 

Customer-Demanded Omnichannel Campaigns Mate Mail With Digital

For Andersen, mail personalization must be part of the omnichannel approach that customers demand today: “One of the biggest opportunities in the direct mail space is providing effective and efficient solutions to consumer demand for personalized, relevant messaging integrated across all channels. Insightful use of data, combined with the flexibility of digital print production, allows marketers to seamlessly integrate tactile marketing in their omnichannel campaigns.” Summer Gould, of Target Marketing magazine, has cited three already-proven ways to combine mail and digital:  1) online display ads that match direct mail data files to an IP address to target specific people by displaying cookie-free banner ads on web pages; 2) Facebook ads that match direct mail data with Facebook data to send targeted ads (see our Facebook Match services); and 3) e-mail matched with direct mail audience targeting to keep offers fresh, deliver response reminders and make added special offers (see our Digital2Direct services). The mail-digital mating can be taken even further to a union of programmatic automation with mail. Printing Impressions cites the example of Brodnax 21C Printers in Dallas, where Jim Singer, managing partner, describes their innovative program: “We take raw XML data to drive intricate, complex direct mail campaigns, including ongoing on-demand digital printing campaigns for local store marketing applications. Every night at midnight we get a massive amount of data, and the automated workflow we built for this programmatic offering” kicks in to generate direct mail campaigns and send them to production.

Data Quality Has Never Been More Paramount

These trends to more personalization and omnichannel integration rely on marketing data for segmentation and targeting, of course. Plus marketers must adjust for growing regulation of data security and privacy. All make data quality a top direct marketing priority in 2020. Yet too many marketers feel overwhelmed by the torrent of omnichannel “big data.” A Forrester Consulting 2019 survey revealed that, while 82% of companies place a high priority on refining data quality, more than a quarter of all marketing campaigns were hurt by substandard data in the last 12 months. Clicktale 2019 surveys of marketing and customer-experience professionals found almost a third of marketers don’t feel they’re effective at utilizing their web and mobile data, over half (54%) said they “don’t believe they have a strong understanding of their customers’ behavior across digital channels,” and 20% reported feeling like “they will never truly understand why their customers buy.” Check out this 10-step data-quality strategy from VisionEdge Marketing if you are looking for a place to start.

 

 

 

 

 

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Leverage 2020 Trends With Direct Mail Push

For direct marketers hesitating over direct mail campaign investments, 2020 is the year to strike while the iron is hot—with a good economy, high response rates and flat costs. That’s especially true because the 2021 road may be a bit bumpier.

Economy, Response and Costs Give 2020 Mail Green Signals

The U.S. consumer is confident, the economy is projected to continue growing in 2020, and mailing cost inflation is minimal. Per the December 2019 Federal Open Market Committee, U.S. GDP growth is forecast to average 2%, lower than 2019’s 2.2% but far from recession. Meanwhile, consumer buying power should remain strong with an average unemployment rate of 3.5% in 2020 and a core inflation rate (stripping out volatile fuel and food prices) projected to average just 1.9% in 2020, while the Federal Reserve’s eased interest rates continue to buoy growth. So it’s no surprise that consumers are entering 2020 with positive outlooks: The University of Michigan’s consumer sentiment for the U.S. was 99.3 for December of 2019, the highest reading since May of last year. And direct mail offers unique advantages for reaching those consumers, starting with high response rates. The last ANA/DMA data pegged average direct mail response at historic highs of 4.9% for prospect lists and 9% for house lists, way ahead of the 1% response rates of e-mail, social media and paid search. Meanwhile, low projected increases in key costs are clearing the way for ROI on mail investment as well.  For example, 2020 coated paper prices are projected to be held down by reduced demand, caused by a continued growth of electronic media use by advertising and publication printing, coupled with oversupply from new production capacity, especially in Asia. A strong U.S. dollar adds to downward price pressure. Meanwhile, postal rates for marketing mail in 2020 are expected to remain close to the average as enhanced carrier route letters go up less than average, with five-digit automation letter rates, entered at the SCF, projected to increase by 2.2%, and the high-density walk sequence carrier route letter rate, entered at the SCF, increasing only 1.1%.

After 2020, Mail Faces Rougher Economic Seas

Those who fail to take advantage of 2020’s positive direct-mail climate may soon regret the missed opportunity if costs rise and the aging economic growth cycle slips into recession. Potential postal rate increases are an especially dark cloud. In December, the Postal Rate Commission (PRC) proposed new rules for USPS rate-making that, if implemented for all classes of mail would increase rates by a massive 30%-50% over the following five years. Mailers and their organizations will want to join The Nonprofit Alliance and the Alliance of Nonprofit Mailers in fighting such huge increases. At the same time, the economy, even if it stays out of recession, is projected to slow. The Federal Open Market Committee forecasts U.S. GDP growth to slow to 1.9% in 2021 and 1.8% in 2022, as a side effect of trade-war drags. Meanwhile, new data security and privacy legislation could pose significant challenges for data-driven marketing.

Data-Driven Efforts Face Privacy Legislation Challenges

The shift to more targeted, personalized and timely direct-mail campaigns is one reason that direct mail continues to turn in high responses at acceptable ROI. But using digital print technology, coupled with audience selection and segmentation, to personalize and target every component of a mail piece relies on data, and privacy laws are coming in to regulate the previously wide-open data market. Of course, there is the GDPR (EU General Data Protection Regulation), but most marketers are going to be more affected by new U.S. state and federal privacy law pushes. For example, California’s CCPA (California Consumer Privacy Act) went into effect January 1 of this year. It applies to for-profit businesses operating in California and collecting personal data if they have annual gross revenues over $25 million; annually buy, receive, sell, or share personal information of over 50,000 California consumers, households, or devices; and derive at least 50% of annual revenue from selling California consumers’ personal information. The regulation offers consumers the right to access information (including categories of data collected, shared or sold; categories of sources from which this personal information was collected, with whom it was shared, and to whom it was sold; specific pieces of personal information collected; and why the personal information was collected). Consumers also gain a right to deletion (the ability to request that a company delete personal information collected) and a right to opt out (the ability to direct a company to not sell personal information to third parties). Now The Nonprofit Alliance is alerting mailers that new data privacy and financial disclosure bills are in the offing. California, for one, isn’t done legislating in this area, and other states (such as Virginia) are following in California’s footsteps. Plus, the Senate is continuing an effort to draft a bipartisan national privacy statute led by the “Gang of Six”—Republicans Roger Wicker (MS), John Thune (SD), and Jerry Moran (KS); and Democrats Maria Cantwell (WA), Richard Blumenthal (CT), and Brian Schatz (HI)—and most Republican Senators appear to support legislation which would preempt state privacy statutes with a uniform national standard. For marketers, the hope must be that a national “rules of the road” for data privacy will be less onerous than a patchwork of state laws.

All these potential challenges ahead are making 2020 look like a good year to profit from direct mail and targeted lists! For more inspiring direct mail statistics, see this compilation from mail automation provider Inkit.

 

Catalog Marketing Retains Its Retail Clout

Consumer retail catalogs, far from fading away with the growth of e-commerce, have continued to deliver for our omnichannel retail clients. A Multichannel Merchant blog post earlier this year cites a number of reasons why retailers should consider expanding, reviving or initiating a catalog marketing effort, especially with an eye to upcoming holiday spending.

Catalogs Boost Engagement, Response Across Channels

Catalogs are not, as some assumed, favored only by older buyers, while younger buyers focus on digital channels. In fact, research has shown that 65% of millennial target buyers have made a purchase influenced by a catalog. Today’s lower mail volumes combine with the unique visual and tactile qualities of print to make catalogs stand out in terms of engaging interaction for younger generations, boosting response over online display and even e-mail. Retailers who integrate catalogs with stores, websites and mobile in omnichannel acquisition campaigns boost response and conversion overall. For example, researchers have found that 20% of first-time customers make a purchase on a retailer’s website after receiving a catalog.

Technology Allows for Personalized Targeting, Fulfillment

Today’s more sophisticated data analytics and marketing technologies let marketers track spending habits and response across channels to better leverage catalogs as part of omnichannel marketing campaigns. Retailers can not only use use variable data printing to personalize catalogs based on demographics and purchase behavior but can then use intelligent fulfillment technology to integrate targeted catalogs and samples into the existing fulfillment operation to expand brand marketing opportunities. To capitalize on online response to print catalogs, retailers can use innovations such as quick codes applied to printed catalog products for easier online purchasing. And they can use nimbler, on-demand printing to offer repeat customers a catalog built to their unique interests. Warehouse technology then can put the right catalogs in the right customers’ hands quickly and seamlessly. Certainly, retailers should consider how leveraging technology will make holiday catalogs into better sales drivers. For example, as the Multichannel Merchant post notes, retailers with order packing software in place can simply assign an SKU to a catalog or a pending holiday “Buyer’s Guide,” include the SKU in order packing software rules, and pack a catalog in each shipment as part of a holiday campaign, boosting brand recognition and repeat customers.

Industry, Marketing Trends Help Grow Printed Business Publications

New print publishing trends and innovative marketing options offer good news for AccuList’s many business periodical clients seeking to boost subscribers and advertising.

Printed Business Magazines Are Alive & Well in the Digital Age

The growth of digital readership has not doomed all printed periodicals to declining circulation and revenues, as some predicted. In fact, a recent What’s New in Publishing article cites multiple ways print magazines are adapting for growth. For example, publishers are focusing on niche audiences willing to pay more for a higher grade product and cutting down on frequency. Consider the Harvard Business Review: It grew its subscriber base 10% by reducing print frequency from 10 issues to 6 a year and using smart positioning, creative new digital benefits, and heavier investment in the quality of the six print issues to increase audience appeal. Printed information is also seen as more reliable by readers and advertisers, according to research, creating a “halo effect” for business publishers with a print edition. “The good news for printed business magazines is that their credibility has a halo effect on their websites, too, which gives them a competitive advantage over digital-only competitors. People may be buying fewer magazines, but they still associate them with quality and reliability,” explains the publishing industry’s Dead Tree Edition blog. Plus, despite fears that younger business readers were turning mainly to digital sources and social media for information, publishers can take advantage of continued print readership popularity. For example, the Association of Magazine Media’s “Magazine Media Factbook 2018-2019″ shows that, in the United States, “the top 25 print magazines reach more adults and teens than the top 25 prime time shows.”

Business Publishers Can Leverage New Marketing Trends

New print technologies and a revival of traditional marketing tools offer business periodicals options for boosting audience and advertiser appeal. A recent article from media agency Mediaspace Solutions cites some ideas that publishers can leverage. With the digital space crowded, noisy and less trusted by potential readers, direct mail campaigns have increased in effectiveness, the post notes. Plus, many publishers have returned to sending printed newsletters to subscribers. Print technologies (QR codes, augmented reality, etc.) are not only tools for better direct mail response but also a way to attract print advertisers by boosting print advertising effectiveness, the post points out. For example, augmented print uses an application that stacks digital content over a print ad so that when the print ad is scanned by a smartphone, a new digital ad springs to life. Personalization is a must in today’s marketing, and business publishers can combine list segmentation and targeting with variable data printing to personalize direct mail campaigns for audience building. Plus, subscriber list segmentation can be offered to print advertisers to help them craft more targeted messages. For more ideas, see the Mediaspace Solutions post.

Brain Science, Industry Data Bolster Direct Mail Fundraising

As digital, mobile and social media expand their donor influence, some nonprofit marketers prepping for the all-important fourth-quarter may wonder about direct mail’s role as a fundraising workhorse. To underscore why it’s essential to keep direct mail in harness, AccuList can not only cite years of success as a direct mail list broker and data services provider to fundraising clients, but also the latest brain science and marketing industry data.

Science Shows Donor Brains Respond to Direct Mail

Marketing channels and technology may be changing rapidly, but the human brain hasn’t changed in size and basic construction for about 500,000+ years, and mail marketers have a brain advantage, notes a recent NonProfit PRO article by Christopher Foster, vice president of business development at Modern Postcard. Neuroscience has shown that direct mail taps two basic parts of the brain: the cerebral cortex and the amygdala-hippocampus pairing. The cerebral cortex
is where we process information, think about messaging and language, and weigh the pros and cons of decisions. Unlike the truncated messaging of digital, e-mail and social, direct mail can engage this part of the brain by describing benefits and citing the objective reasons that a nonprofit is the best choice for donor dollars. Plus, research consistently shows that people trust print/direct mail information more than digital channel info. Of course, recall and emotional engagement are key drivers, and the amygdala and hippocampus, combining long-term memory with emotional response, favor direct mail over digital, too. In fact, research shows that direct mail is 35% stronger than social media and 49% stronger than e-mail when it comes to long-term memory encoding, and 33% stronger than e-mail and social media in the engagement that drives memory encoding. Overall, direct mail’s motivation response is 20% higher than digital media, per Canada Post research.

Mail Spurs Donor Response and Retention in Omnichannel Efforts

While the volume of direct mail has decreased by about 2% each year since 2015, this has actually helped boost direct mail effectiveness by helping it stand out in the messaging blitz of the digital era. In fact, the Data & Marketing Association (DMA) 2018 direct mail response rates were 9% for a house list and 5% for a prospect list, way higher than any other channels (such as e-mail, social media and paid search at 1%). As a result, mail’s median ROI is also higher than most digital channels. Direct mail, of course, works even better integrated into an omnichannel campaign, where it actually spurs digital results; for example, studies show donors are three times more likely to give online in response to a direct mail appeal than to an e-appeal. Plus, direct mail drives donor retention; for example, 70% of donors have restarted a relationship because of direct mail, per DMA data. And direct mail is efficient at retention; the Association of Fundraising Professionals reports direct mail costs $0.25 for every $1 from recurring donors.

The Right Fundraising Tactics Capitalize on Mail’s Strengths

However, direct mail’s fundraising success is certainly not a given. A recent NonProfit PRO article by Jen Linck, chief marketing officer for Corporate Giving Connection, cites some important strategies, beginning with list segmentation and targeting to avoid wasting time and resources sending costly direct mail to bad leads. We would note here that, for effective segmentation, data quality is key, which requires prospect lists from reputable sources and good hygiene of house lists (note that 20% of addresses in donor databases are out-of-date, per research). Then get creative to capture attention and drive envelope opens via tactics such as dimensional mail and a large or unconventional sized envelope, urges Linck. And make sure the direct mail pieces add value to the audience’s lives by including a special offer or a promotional gift of branded materials for everyday use, such as a notepad. But remember that content needs to tap both logical persuasion and emotional connections in donor’s brains! Because 63% of donors want to know how their donation will be used, use specific donation amounts to tell donors how they help and quantify how previous amounts donated have been used, but also inject emotional examples into the dollar results. Finally, remember that direct mail works best when it is integrated into an omnichannel campaign, so be sure to incorporate digital technology by including QR codes, short links or text keywords for use across all channels. Plus, links should direct donors to a branded, campaign-specific landing page, since 38% more donations happen when landing pages are branded and campaign-specific, and 66% of those same donors are more likely to come back and donate again. For more tips on integrating direct mail with digital fundraising, see this MobileCause infographic.

Basic Steps Help Maximize Direct Mail ROI

Industry data shows that direct mail is still relevant and effective in this digital era, which is why clients continue to come to AccuList for its expertise in targeted direct mailing lists and data services. While postal mail wins a higher response rate than other direct marketing channels, its higher costs also intimidate those wary of ROI stumbles, so as marketers begin to prepare 2020 budgets, we’ll pass along some key tips for making “the most of the post” from Chief Marketer.

Keep It Clear and Simple—With a Wow Factor

Anxious to pack in maximum value for the cost of postage, direct mailers can create counterproductive pieces. Long-winded content and pieces crammed to the gills with words, images and multiple messages actually can create confusion that drives recipients away rather than calling them to action, the Chief Marketer article warns. Instead, use white space judiciously to highlight key content, keep messaging direct and simple, and make the offer and call to action clear and easy to follow. If you have multiple messages, consider multiple mailings. On the other hand, don’t be afraid to think big and out-of-the-box. Look for a wow factor that will stand out amid mailbox clutter. Oversize or dimensional mail pieces, promotions ranging from a personalized item to a free report, or an overnight envelope that sparks open-me urgency are examples that have proven effective in boosting response.

Focus on Quality Lists and Targeted, Personalized Content

Direct mail success starts with clean, up-to-date list data and selective targeting of prospects or customers. Just choosing the right targets is not enough, however. They must receive the right message. Marketers should use demographic, geographic and psychographic parameters to segment lists and then variable data printing to craft personalized content to send the right message to the right audience. Chief Marketer cites the marketing strategy of healthcare insurer Blue Cross Blue Shield of Michigan, which works with PFL marketing/printing and Salesforce Marketing Cloud to score its membership based on various criteria and then sends a tailored direct mail piece likely to drive engagement to each member. 

Test and Track to Maximize ROI

Trying to reduce mail costs by skimping on testing—whether of list, creative or offer—is sure to backfire in terms of ROI, warn the experts, especially when introducing a new brand, product or creative. Always test to optimize response before risking the cost of rollout. Also, failing to track mail response across channels, especially in today’s multichannel world, will compound ROI risks. Before you mail, consider how you will measure ROI, such as visits to a unique URL, calls to a dedicated 800 number, mailed reply card, or other response device, advises the article.


Plan How Mail Fits With Multi-channel Branding

Direct mail today rarely exists in a vacuum. Marketers simultaneously support promotions via websites, e-mail, social media and even TV. Before launching a direct mail campaign, decide how postal mail fits and interacts with other channels and branding initiatives. Make sure direct mail messaging is consistent with cross-channel efforts and brand identity. For more, see the full post of Chief Marketer tips.

Is Your Direct Marketing Realizing Personalization’s Potential?

Every direct marketing effort today starts with an assumption of personalization. In fact, with today’s tech advances in digital data, marketing automation, AI, variable data printing and more, the simple “Dear FirstName” personalization of yesteryear has been replaced by goals such as “hyper-personalization” and “personalizaton at scale.” Barry Feldman of Feldman Creative recently put together an infographic for MarketingProfs to illustrate the potential of personalized marketing for those who still think appealing to “FirstName” is enough.

It All Starts With Good Data

Before summarizing Feldman’s infographic, we would point out that, as data brokers and data services providers, AccuList is especially interested because personalized marketing relies on up-to-date, enhanced, accurate data to deliver on the promise—the right message, to the right person, at the right time—whether for customers or prospects. Customer outreach and the customer-based analytics for targeting prospects require collecting data from as many sources as possible: CRM, web activity, e-mail, direct mail, mobile apps, second- and third-party demographics, social media, and multichannel advertising. And then that data must be combined and maintained in a regularly hygiened customer data platform. Haven’t gotten there yet? You’re not alone. Only 5% of marketers have attained a single customer-data view that allows launching personalization across channels, per the infographic.

Why Invest in Personalization? Buyers Demand It

So why worry about an edge gained by just 5% of competitors? When 78% of Internet users say personally relevant content increases their purchase intent, and 81% of consumers say they want brands to know them better and to know when (and when not) to approach them, any brand that is ignoring that demand for personalization is ignoring the bulk of their potential market. What do customers and prospects want? Feldman’s infographic breaks it down into “four R’s” based on research: Recognize, Remember, Relevance and Recommend. People expect to be recognized by name and to have their preferences remembered so that brands can make suitable recommendations and send relevant offers.

The Payoff Is Big in Financial and Brand Clout

The bottom line shows why the “four R’s” matter. Studies find that personalization can cut acquisition costs by up to 50%, lift revenues by 5%-15%, and increase the efficiency of the marketing spend by 10% to 30%, per the infographic’s sources. Plus, in a competitive market, personalization will woo the 60% of shoppers who prefer to do business with brands that provide personalized, real-time offers and promotions. This is especially true if the customer experience is consistent across channels. With omnichannel personalization, studies show that marketers can achieve the multiple goals of boosting response, improving customer experience, increasing brand loyalty, driving revenue and delivering creative consistency across channels.

Omnichannel Personalization Includes Direct Mail

While discussions of one-to-one marketing often focus on digital efforts, traditional direct mail also has benefited from the technology trends driving personalization. Of course, a postcard or an envelope are, in a sense, always personalized by name and address for delivery, but inside the envelope or mailer, a letter, reply card, lift note, coupon, etc. can be personalized even more extensively. For example, a personalized pre-filled reply card has the advantages of both increasing response by cutting recipient effort and ensuring reply completeness and accuracy. More important, with enough quality data on recipients and modern variable data printing (VDP), messaging can be modified for each recipient based on database/list information such as purchase history, demographics/firmographics and online activity. A business-to-business campaign can be tailored by industry, title, association membership, online visits and more. A retailer can use product purchase history to craft discount offers, up-sales and cross-sales. An auto insurance mailer can leverage policy expire date, owner age, vehicle information, online quote requests, etc. to create a timely, personalized offer. VDP can even tailor graphics to fit individualized content. Plus, printing a personalized url (PURL) is one option that can take a curious recipient to a personalized online landing page with a pre-populated form and select offers. Or unique QR codes can be printed to take each recipient to a custom, personalized web page. There’s no reason for direct mail to remain stuck in the “Dear FirstName” era of personalization!

Emerging Technologies Create New Breed of Interactive Mail

To help boost direct mailer use of emerging technologies, the U.S. Postal Service offered postage discounts this summer for use of interactive mail tools such as QR codes, Augmented Reality (AR), Virtual Reality (VR), Near Field Communications (NFC), and Video in Print. But taking a new technology from gimmick to ROI booster requires inspiration even more than discounts. So here are some success stories courtesy of the USPS, too.

Use QR & AR to Link Print to Digital Experiences

Among the USPS-cited case studies of use of mobile- or tablet-scanned QR and AR codes is this example of how QR codes proved their value for organized sports marketing. Sports event managers created more than 50 unique codes for signage, publications and e-tickets to provide information, social media sharing, and mobile store access, and succeeded in getting QR-code users to scan event material an average of 1.6 times and increased downloads of the official app to 15 million. Meanwhile, AR proved its traffic-building value for a furniture retailer’s mailed yearly catalog; recipients used the app to superimpose pieces of furniture onto a real-time 360°/180° view of their homes, resulting in both more app and website visits by customers for the retailer. The information gathered by apps can achieve other retail marketing goals besides traffic and sales, of course. The USPS cites a beauty company’s print ad AR app that allowed digital trials of nail polish, with the goals of preventing product returns and improving future stocking decisions and color choices. Over 10% of users scanned the ad with their smartphones or tablets to try on 40 different nail polish colors.

Use NFC, Video and Mobile in Print for Immediate Interaction

Near Field Communications (NFC) relies on chips and radio waves to communicate with smartphones rather than scannable codes and has the advantage of instant access without app download. The USPS notes a movie premiere’s NFC-enabled posters that encouraged users to tap an image with their smartphones to access behind-the-scenes footage, and an Uber campaign in England with NFC-enabled coasters in pubs, right on the table with the smartphones–and the drinks inspiring ride requests. Video-in-Print (VIP) uses a video device included in a mailer or print ad and can work well for targeting high-value customers. For example, an auto company promoting a new truck used publisher data to select 20,000 readers who fit the target truck owner profile and sent them a VIP magazine insert. Mobile-in-Print also creates immediate interaction by placing mobile call or text capabilities in print media. Consider the case of a multinational auto insurance company plagued by complaints about help line delays: The insurer sent out mobile-in-print mailers that prompted customers to use the keypad embedded on the page to enter their mobile telephone number and license plate information to receive instant insurance quotes on their mobile devices. For more examples of innovative direct mail ideas courtesy of the USPS, see
https://www.uspsdelivers.com/16-case-studies-to-inspire-your-next-direct-mail-campaign/

Latest Data Shows Direct Mail Is Still Alive, Well and Effective

Some marketers theorize that “direct mail is dead” about as often as “Game of Thrones” fans theorize about the fate of favorite characters. So for all of AccuList’s current and future direct mail list and data services clients, here is current proof that direct mail is alive and well, and still a key direct marketing tool.

Marketing Mail Enters 2019 on a Growth Path

The U.S. Postal Service reports that revenue for the first quarter of fiscal 2019 (October-December 2018) was up 2.9% to a $19.7 billion total over the same prior-year quarter. A decline in First Class Mail dollars and volume was more than offset by Marketing Mail’s 4.9% increase in revenue, up by $218 billion, and 4.8% bump in volume, up by 1 billion pieces, combined with Shipping and Packaging revenue growth of 8.7%, up by $516 million, and a 5.4% volume bump, up by 93 million pieces.

Mail Response Outpaces Other Channels

We’ve reported it before, but it bears repeating because it explains why direct mail is still an important marketing tool in this digital age: The 2018 DMA/ANA Response Rate Report shows an average direct mail response rate of 9% for house lists and 5% for prospect lists, stellar rates compared with response rates of 1% or less for e-mail, social media, paid search and display ads. In fact, lower mailbox volumes actually have helped turbocharge mail response in an era of digital promotional bombardment, from e-mail, to online ads to mobile ads. Consider that, each day, an average of 107 e-mails per person are received globally and an average 63 ads per person are viewed, but only an average of two pieces of mail are received per person. It’s clear which channel gets the audience attention and why 75% of households read or scan their direct mail ad materials daily, per a USPS 2016 study. Not only was direct mail the top purchase influencer among Baby Boomers, even beating out family and friend recommendations, per a 2015 MarketingCharts study, but even younger, digitally addicted generations are fans of direct mail, too. According to USPS studies, 77% of Millennials pay attention to direct mail advertising, 90% think direct mail advertising is reliable, 57% have made purchases based on direct mail offers, and 87% of Millennials say they like receiving direct mail. Direct mail works or an even younger group of consumers as well: 69% of 18- to 24-year-olds prefer reading print and paper communications over reading from a digital screen, per paper-producer Sappi.

Mail Wins by Being Trusted, Engaging and Personal

How can direct mail work so well across generations of consumers? First of all, in an age where trust in advertising is at a minimum, 76% of consumers say they trust direct mail when they want to make a purchase decision, and trust it more than digital channels, per a 2016 Marketing Sherpa study. Direct mail is also more engaging, memorable and persuasive, per neuroscience studies. In fact, a 2015 Canada Post neuroscience study of direct mail found that direct mail’s motivation response, its persuasive power, is 20% higher than digital media’s motivation response. Finally, in an age when personalization is expected and demanded, direct mail can harness multi-channel databases to machine learning/AI, variable data printing and behavior-based triggers to produce timely, highly personalized messaging, images and offers, way beyond the old first-name addressing of the past. Need more convincing? Check out direct mail solutions provider Compu-Mail’s slide show of 35 direct mail statistics for 2019.

Personalization Is Now Key to Insurance Marketing ROI

Personalization has become a mantra for all direct marketers, but it is especially relevant to AccuList’s insurance marketing clients. According to an Accenture 2018 study, 80% of insurance consumers are willing to share data to get more personalized offers, messages, pricing and recommendations from auto, home and life insurance providers. Although over 70% of insurance marketing campaigns claim to use some personalization, surveys show marketers are not doing enough to satisfy that customer demand. As a result, marketers can miss out on personalization’s proven power to improve response and ROI, lower acquisition costs, and enhance cross-selling.

Personalization Revs Mail’s Acquisition Power

While digital data often leads conversations, the importance of personalization in traditional direct mail, still an insurance workhorse, should not be ignored. After all, direct mail is considered more personal than digital by 69% of recipients, giving personalized content extra power. Direct mail also gets an average 9% response rate for house lists and 5% for prospects, per 2018 DMA/ANA data, compared with 1% or lower for other channels. Plus, for the digitally addicted, adding direct mail to digital bumps up conversion by 28%. A recent article on insurance marketing from agency Ballantine advised on top ways to maximize mail ROI, and, no surprise, personalization dominated—assuming clean, up-to-date mailing lists with important targeting parameters. First, marketers can use variable data printing and database parameters to personalize content and images to match the consumer’s life stage, so, for example, auto policy creative targeting a young single first-time car buyer differs in messaging and images from the creative for an older couple with a minivan. Next, marketers can personalize rates by taking into account factors such as the age and gender of the targeted recipient. And they can tap personal interests by leveraging affinity relationships, such as a specific sports team or association affiliation, via targeted discounts. Personalization shouldn’t stop with the mailing package but should then continue through the customer journey. Marketers can study the sales funnel to find when leads are most likely to drop out so that processes can be simplified, streamlined and further personalized to boost conversion. Simple examples include pre-filled forms and postage-paid return envelopes.

It’s All About Prospect and Policyholder Data

Meanwhile, One Inc., an insurance software company, offers a helpful roadmap to digital personalization. As with direct mail, marketing begins with quality consumer data and analysis, taking a step beyond age, gender and location to parameters that identify unmet needs and customer value for targeting and prioritization—such as a recent move, a new home, a new baby or an upcoming policy expiration date. Next, marketers need to track lead and policyholder actions to decide on the specific digital behaviors that will trigger a personalized response, say following up an online request for information with a series of lead-nurture e-mails. Then, marketers can design and test small campaigns of personalized content and process before expanding to more channels and audiences. Once strategies and processes have been developed and tested, an investment in marketing automation technology can follow, including AI algorithms using real-time data and behavior to tailor offers, customer service, cross-selling, lead scoring and more. Indeed, the advent of AI in the digital world is accelerating consumers’ personalization expectations, and the impact on the insurance industry is expected to keep rising in 2019, per articles.

Retention Relies on Smart Personalization, Too

Meanwhile, studies show personalization is also essential to cost-effective policyholder retention. One Inc. provides this example: An auto policyholder has a documented poor experience when filing a claim, putting the client in a “high risk” category for churn. Based on industry data that policyholders typically shop roughly two months (60 days) prior to policy expiration and that roughly one-third of shoppers switch carriers, marketers use the policy expiration date and contact information to send a letter 60 days before the policy is set to expire, personalized by the policyholder’s name, of course. The letter includes a personal note that acknowledges the poor experience and pledges to do better, an offer of a discount for renewing early, and rep contact information for quick response to questions or concerns.