Direct Mail and the Evolving B-to-B Source Mix

It's looking so bad that it might be good.

By Kelsey Voss 06/24/2009 -02:31 PM

I've been asked recently about my new business and renewal source mix, specifically for direct mail. My answer: I have eliminated all direct mail. Since 2006. That's right, not one piece in over 3 years. Why? Simply, the conversion was abysmal and the postage was ridiculously expensive.

A recent AD Controlled B-to-B survey, showed that direct mail remains strong as the number-two new business source (own Web site was number one). But you will certainly find for most marketers, especially those with controlled publications or online-only products, direct mail's future is dim:

For consumer marketing, direct mail is alive if not entirely well.

In a webinar associated with the AD survey, I discuss my source mix and tips on what to do when direct mail doesn't work.

As I mentioned above, the results of our final direct mail campaign were horrible (0.05 percent conversion rate). The campaign was certainly hindered by our 100 percent, electronic-only qualification forms. It was laborious for people to receive a piece of direct mail, be convinced to subscribe for a subscription, log onto a computer (there was no qualification form or BRC included in the direct mail piece, just a link), visit the correct Web site page, complete an online form with 20 questions, hit submit, and ultimately, for our benefit, qualify to receive the subscription.

Our main source was, and still is email. But dropping direct mail still left a source void. We began outbound telemarketing in 2005. It was more expensive than email but it was immediately apparent that it was well worth the expense. We began with requal campaigns and saw 45-50 percent conversion rates. Based on these results, we started telemarketing for new business in 2006, again seeing fantastic conversion rates of 15 to 30 percent for the best campaigns. Hence, telemarketing replaced direct mail.

Despite not using direct mail in years, I predict that it will once again be in my source mix. Direct mail has dropped off so significantly that to receive a mail piece can actually stand out and be effective, especially if it's presented well as first class mail, as not cheap bulk mail. Instead of being one of many non-requested offers in the mail, it may be the only one. It will have a better chance of being opened. I will use direct mail for very targeted campaigns, such as invitations to existing subscribers, requesting their presence at small, exclusive events.

Overall, direct mail will never be what it once was for b-to-b marketing. Web site and email transactions are cheap, easy and provide realtime interaction with subscribers. But my belief is that just like books, radio and TV, communication platforms rarely end for good. Although, I don't hold out much hope for the telegram.