Target vs. Saturation: Direct Mail Acquisition Strategies
Best ways to develop direct mail acquisition campaigns for new customers.
March 22, 2016
One of the most common goals of a direct mail campaign is new customer acquisition.
When you are introducing your product or service to new prospects, there are several things to consider: Do you have an effective design and message? Are you sending it at the right time? Do you have a strong offer? But perhaps most importantly, are you sending it to the right people?
There are two main approaches to developing a list for an effective acquisition campaign. The first is Saturation, which is essentially blanketing your message to everyone in a given area. Your list cost and postage rates are lower with this option. The second is Targeted, in which you refine the list by selected criteria and send to those specific individuals. With Targeted your list includes names along with the addresses and you will still qualify for many postal discounts depending on your volume and the make up of the list. Which is right for you?
Here are a few things to consider:
Choose Saturation if... Your call to action is centered around a specific location, such as a retail store. You can select specific areas by zip code, for instance, or a radius around your location. Use it to boost brand recognition, increase walk-in traffic, and promote local offers.
Choose Targeted if... Your product or service is internet-based or otherwise not restricted by physical proximity. The exception here would be if you want to test a broad campaign in a specific market or locality.
Choose Saturation if... Your product or service has broad appeal to any demographic. A good example would be pizza delivery.
Choose Targeted if... Your product or service has a specific audience, like people with kids or pets, or if it appeals primarily to a certain demographic, whose qualifiers may include things like household income, age, or gender. A good way to define this is to draw insights from your existing customer data. (Our data team can help with this.)
Message & Offer
Choose Saturation if... Your sales message and benefits appeal to just about anyone. Your offer is straightforward and likely discount focused.
Choose Targeted if... Your point of difference only speaks to a specific audience. Your unique benefits align closely with your ideal customer persona. (For instance, all your effort is most likely wasted if you mail a piece promoting travel getaways for singles to married couples with children.) Your offer appeals to the recipient because of its benefits, not just a discount. Having the prospect's name adds value because you can use it to personalize your offer.
Dollars & Cents
Choose Saturation if... Your business aligns with many of these statements:
- Your average sale amount is relatively low.
- Your revenue is primarily driven by volume.
- You want to reach a large number of people for a low price per piece.
- Your business is transactional vs. relationship focused.
Choose Targeted if... More of these statements align with your business:
- Your average sale and potential customer lifetime value is high.
- Your revenue is driven by building relationships with the right people.
- You're more focused on cost per acquisition than cost per piece, because reaching the right people means a higher chance of response.
Hopefully these points have given you a good starting point as you consider your next acquisition campaign.