Direct mail leading channel for customer acquisition

Direct mail is still the channel of choice for customer acquisition and runs a close second for customer retention according to the recently released Media Usage Forecast by Target Marketing.

Customer Acquisition
In 2008, 52% of direct marketers’ media budget will be spent on customer acquisition. According to Target Marketing’s survey, 34% of direct marketers found that direct mail delivered the strongest ROI for customer acquisition. Email came in second place with 24%. In terms of usage direct mail still comes out on top with 81% of direct marketers reporting that they use direct mail for customer acquisition. This is followed closely by email (78%), search engine marketing (60%) and search engine optimization (59%).

Customer Retention
When it comes to the ROI of customer retention efforts, email and direct mail are very close. Thirty-seven percent of direct marketers reported that email delivered the strongest ROI and direct mail came in a close second at 33%. Although the ROI is close between these two channels there is a preference among marketers to use the less expensive email channel when communicating with existing customers. Eighty-five percent of marketers plan on using email in their customer retention efforts, compared with 76% who plan to use direct mail.

Direct Marketing Spend
The majority of direct marketers anticipate that their total media budget for 2008 will either stay the same or increase compared to 2007 expenditures. Not surprisingly the growth of electronic channels is outpacing that of direct mail. Eighty-nine percent of marketers plan to increase or maintain their budget for email marketing. This compares to 76% of marketers who plan to increase or maintain their budget for direct mail.

Among those that are planning on decreasing their direct mail budget, rising postal and paper costs were noted as factors in the decision.

What This Means for Print and Marketing Service Providers
Some of the respondents who planned on increasing their use of direct mail cited advancements such as variable data personalization, Personalized URLs and targeting abilities. Service providers should work with their customers to incorporate these relevant marketing techniques to increase their overall campaign effectiveness.

PODi members should take advantage of these resources:

• Educate your sales staff and your customers with PODi’s digital print case studies. Use the advanced search function to look particularly for Direct Marketing Lead Generation cases and for cases that incorporate Personalized URLs. Also, look for 46 new case studies to be added to the online database next month.
• Learn how you can help develop an effective customer retention program by reading the New Customer Experience report. This report is free to PODi members and may be purchased by non-members at our online store.
• PODi members should also utilize the sales tools on the S3 Council site including the Lead Generation Solution Presentation and Value Calculator. All the resources on the S3 Council site are free to PODi members.

Comments

[Mitch Aase]

I strongly recommend the New Customer Experience report, available above. The section on "Avoiding Pitfalls" is spot on. Thanks again, for all the help and support!

We love you guys...

Mitch Aase
Director of Sales & Marketing
Magicomm, LLC
phone: 978.834.3171 ext: 101
e-mail: mitch@magicomm.biz
web: www.magicomm.biz
fax: 610.808.3986