Case study: The power of addressed mail

The success of integrated campaigns is well documented. Less well-known is just how well the evidence stacks up on the bottom line for addressed mail.

The success of integrated campaigns is well documented. Less well-known is just how well the evidence stacks up on the bottom line for addressed mail.

Direct marketers have long trumpeted the advantages of the medium for its measurability and demonstrated effectiveness, and along with it the ability to constantly improve return on investment through testing — whether of the creative, the offer, the proposition, or the audience.effectiveness of addressed direct mail

Just take a look at the numbers. According to Key Research, in a study commissioned by New Zealand Post, median revenue return on investment of direct mail campaigns was $4 in sales for every dollar spent. But in some cases returns of as much as $100 were counted, sending the average ROI to $46 in sales on every dollar spent.

With that sort of evidence to back it up, it’s easy to see why 71 percent of marketers believed their campaigns’ success was boosted by addressed mail.

High response, bigger spend

As part of its Christmas campaign, New World ran a large direct mail campaign targeting its top Fly Buys and Christmas Club customers inviting them to receive quadruple Fly Buys points on a designated Christmas Shopper Day. The grocery chain supplemented this with an email to the rest of its Fly Buys customers to inform them of the offer.

On the designated day, 24 percent of direct mail recipients visited and spent in-store, with an average spend 40 percent higher than on a comparable non-campaign day. In comparison, seven percent of the email recipients spent in-store on the day.

“Our stores saw an increase in revenue on the Christmas Shopper Day,” says Sarah Austin, Foodstuffs’s senior marketing coordinator. “The direct mail component of the campaign played an integral role in that success, contributing to the overall lift in Christmas sales.”

Mail drives digital leads and sales

Ultrafast Fibre, a newcomer to the crowded telecommunications market, wanted to reach new customers with its offering. To ensure its message cut through the noise, it sent a direct mail campaign to 27,000 households and businesses across the central North Island.

Over the following week, the Ultrafast Fibre website received over 10 times as many page views than its daily rate prior, and it experienced increased levels of website activity through the remainder of the month.

The campaign resulted in over 25 percent of the direct mail recipients visiting the website, and six percent of qualified leads to retail service provider websites.

Connections to the Ultrafast Fibre network in the following month more than doubled the daily rate since inception, and continued an accelerated growth trajectory. “With our campaign, we really saw the power of addressed mail to generate sales leads and traffic,” says Brett Morris, marketing manager at Ultrafast Fibre. “And thanks to those results, I was able to easily demonstrate the value of the campaign internally.”

Addressing mail in the mix

As part of the study, Kiwi advertisers were asked about current and past usage of addressed mail, its relative impact, and when and why they would consider it as part of a marketing mix. The results speak for themselves.

More than half the respondents viewed addressed mail as ‘vital’ to customer retention.

“As New World’s experience shows, customers respond very favourably to mailings,” says Victoria Forrest, direct marketing industry specialist at New Zealand Post. “Customers not only respond with their actions, but with their wallets, too.”

When asked about the impact of addressed mail, respondents noted direct mail has the most potential for returns when used to build brand equity, increasing brand awareness and positive perceptions. In fact, almost six out of 10 respondents (58 percent) said direct mail had a significant impact on brand equity. 

There are two other lesser known advantages of addressed to consider.

First, you can control placement — unlike with print, TV, radio or outdoor advertising, where the ads or other images that appear alongside paid advertising might be unpleasantly surprising. Addressed mail is a closed, private medium.

Second, where the explosion of digital media has created the need for verification of ad placement, addressed mail has built-in verification. That is, the ability to determine whether or not a delivered ad has been seen. In the US, comScore research showed less than half the online display ad impressions it measured managed to have at least 50 percent of their content in view to audiences for one second or more.

With addressed mail, return addresses ensure any failed deliveries are returned right back to the advertiser helping, in turn, to maintain data integrity.

what to use addressed direct mail for

For more information about your next direct mail campaign, please contact Victoria Forrest on (04) 496 4584 or victoria.forrest@nzpost.co.nz