Typically, organisations will back either direct mail or direct email as their chosen method to target their customers, unaware of business benefits which result from employing a combination approach of the two mediums. Choosing direct mail over direct email is an argument which has been occupying marketer’s agendas for too long; pitting these two channels against each other highlights advantages and disadvantages for both.
Click through rates for direct marketing emails are reportedly 1.56% whereas the average response rate for direct mail is 4.4% (DMA, Email benchmarking report 2017). Direct mail has a lifespan of up to 17 days (Proactive Marketing, The best direct mail vs email infographic, 26 Mar 2018) compared to direct email which falls victim to emails being deleted unread. Another aspect often compared is the cost – a prospecting direct mail piece might cost 70p to produce and transmit compared to the 20p per email (this cost is usually to cover data usage) Digital Doughnut, Direct Mail vs Email, 15 Feb 2017. Let’s look at the more granular components of each medium.
Direct mail can be tailored to a specific audience thus companies can ensure that customers only receive collateral that meets their needs and represents their buying habits. Direct mail is tangible as it is delivered directly to customers hands – making it nearly guaranteed that they will see and read your message. Physical presence also gives off the sense of being reliable.
Direct email on the other hand, is off the bat perceived to be inexpensive. It is also typically the case that much less creative effort is devoted to email campaigns than postal campaigns, possibly because the low cost of transmission also psychologically devalues the need for creative input. By extension, perceived low cost can suppress discipline over communication frequency; there is often a failure to align frequency of email communications/offers with the frequencies of a customer’s likely behaviour – resulting in the customer feeling pestered and put off from the product.
However, to equally compare direct email with direct mail, all factors – including creative effort – should be equal. Therefore, we created a randomised control trial (RCT) ensuring the same number of creative variants were applied to each channel. For the trial to work we had to also guarantee that the same level of segmentation was applied through each channel and that timings were equitable and equivalent.
Just under 240,000 customers from the same retail client were chosen to receive the trial. One randomised segment received the postal campaign, a second segment received the email campaign and a third segment received offers by both channels. The measurement for success was not solely based on responses but in fact the incremental revenue generated; this measure ensured there was no altering of commercial success by tracking real business outcomes, from offer to response, to conversion and to value. The results were revealing!
Specifically, consumers who only received the offers by email generated incremental revenue per customer of under £1, those who received the offers only through postal direct mail generated an incremental revenue per customer of around £5, and finally, those who received the offers through the post and by email generated incremental revenue per customer of over £6. The results of this RCT show that commercial outcomes are an important differentiator between stand alone email and standalone postal mail. Therefore, marketers should not be regarding direct email and direct mail as a choice but should investigate how the two channels can work together to provide the greatest incremental and complimentary effect.
In our everyday lives we absorb messages from multiple channels, none of us consume one medium and ignore another. Therefore, the debate around the superiority of direct email over direct mail is redundant and marketers need to be looking forward at implementing a combination strategy rather than choosing one medium over another. The key for marketers is to explore how to provide the greatest incremental, complimentary effect of the two mediums to a specific audience while reducing the amount of untargeted communications which customers and prospects often still receive too much of.