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Weekly UpdatesTHERE'S A REASON DIRECT mail has often been called "junk mail" in the past--a huge percentage of the mailed pieces would typically end up in the recipient's trash can. Direct mail marketers were totally fine with that outcome, because each piece didn't cost all that much to produce and deliver, and the business they got from the tiny percentage who did respond more than made up for all the junk.
But don't try applying that rather derogatory term to the kind of direct mail that many marketers are using these days. The latest concepts are much more sophisticated, and while they cost more, the return on that investment can be incredibly handsome. Junk mail? Most certainly not.
The buzzword today is variable data printing, or VDP, and it's proving wrong those who predicted that all the direct marketing action would move to the email front, that direct mail was a medium of the past. Printers remain quite busy creating and delivering marketing pieces through the U.S. mail. In fact, email and direct mail are the top two direct marketing promotional methods, according to the Direct Marketing Association.
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"People thought that email was going to take away all the print," says Billy Bradberry, president of Lincoln Printing in Fort Wayne, "but we have not seen that happen."
"I've heard from some clients that they consider email bothersome," adds David Harding, president and CEO of Harding Poorman Group in Indianapolis. "I don't know if email is bothersome, but with direct mail you have a choice whether you throw it in the wastebasket."
Getting personal. The key to variable data printing is that it's anything but mass mailing, not in the traditional sense. "Direct mail has grown up with the advent of variable data printing," Harding says. "It's a lot more effective than the mass mailing option."
In earlier forms of direct mail, the marketer would create a mailing--perhaps a postcard, a brochure or a catalog--and mail the same thing to thousands or tens of thousands of people. The only thing different from one piece to another would be the name and address on the label.
With variable data printing, on the other hand, digital technology allows each piece to be truly personalized, often in remarkable ways. Not only is the name of each addressee different, but that name might be incorporated throughout the mailing. And that's just the beginning. "You can even change a picture based on the data," Harding says.
For example, the models shown in photos might be of a different gender or race, depending on the demographics of the recipient. A candy company customer who typically orders chocolates might get a mailing with a tasty box of chocolates in the picture, while the caramel lover might be tempted by a photo of handmade caramels. A VDP campaign might also alter the message along with the photography, taking a different tone, focusing on a different product line, making a different offer.
PURLs of wisdom, The slickest variable data campaigns blend the customized printing option with the use of PURLs, or personalized URLs. It's just what it sounds like--a customized Web address created just for the recipient of the mailing, usually something like AddresseeName.CompanyName.com.
"It's about being able to connect with a Web page that gives the company feedback that it has been responded to," Harding says. Here's how it works. "I send you a piece with your name, maybe your mortgage interest rate, maybe your mortgage company, and it says 'do you know you can get a better interest rate?'" he explains.
The highly customized card directs the recipient to a PURL. The recipient visits that page and the company instantly knows who is responding to the direct mail campaign. But that's not all, says Bradberry. "When a customer goes to a PURL they're required to enter information about themselves," he explains. That way, the company has now added to its database record on that potential customer, and can use the additional data to follow up with future mailings that are even more tailor-made to the customer's needs and interests. "The more data you have, the more customized we can make the campaign."
The payoff, It all sounds so sophisticated, it must cost a good bit more than old-fashioned mass mailing, right? Well, yes. "It does cost more, but once you do the ROI your cost per lead is less," Harding says.
How so? Because the returns are so much better with highly customized mailings. Consider that if a mass mailer hears back from just a single customer out of every hundred who received the mailing, that company is going to be pretty happy--typical direct mail response rates may be 1 percent, maybe even less.
As for a sophisticated campaign using variable data printing, Harding says clients have had phenomenal results. "They've seen response rates as high as 32 percent by using VDP as an option."
Bradberry can cite statistics from his experiences helping clients market with VDP One client had a database of about 16,600 names of customers and potential customers. Its VDP campaign cost about $35,000, or about $2.10 per customer.
"A lot of people would look at that and say 'that's high,'" he says. And it certainly was high, compared to the 42 cents that the same client paid to reach each customer the previous year using a traditional mass mailing campaign. But consider the results--the traditional campaign generated sales of about $100,000, while the VDP campaign pulled in nearly $400,000 in sales. "They saw a 300 percent increase in revenue."
Catching on here? "A couple of years ago variable data printing was relatively new, but it's starting to become more popular," Harding says. "Adoption here has taken a couple of years but we're starting to see it more and more."
"We're finding the Fort Wayne marketplace is just starting to catch on to the capabilities of very customized direct mail campaigns," Bradberry agrees.
In fact, he says, "a lot of companies want to do a customized direct mail campaign but don't have the data." There are ways to get started on a more robust database for effective VDP marketing. For example, he says, companies might send out relatively traditional, mass-designed postcards directing recipients to their own PURLs, where data can be collected on a Web page. The response rate from the postcard mailing might not be very high, Bradberry says, "but from the people who do respond, then you can send them a more customized campaign."
For those having budgetary trouble with the higher cost of VDP marketing, consider mailing fewer pieces. That's exactly what a lot of companies are doing, according to Harding. The better your data, the more targeted and smaller your campaign can be. "We're seeing print run lengths coming down," he says. He cites national statistics indicating that more than 50 percent of print runs these days are quantities of 5,000 or fewer, and in the foreseeable future industry observers expect 50 percent of all runs to be 2,000 or fewer. "We had more mailings last year, but lower quantities."
Indiana printers expect to serve an ever-growing demand for variable data printing as the benefits become more widely recognized. As Bradberry observes, "Everybody is trying to find a way to differentiate themselves and stand out."
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