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Direct Mail for 10.5 cents per home? Buyer Beware!

Posted by WeMailUSA on July 1, 2013 at 10:05 AM

We’ve all heard the expression that if the price is too good to be true, it probably is. We recently ran into a situation where we nearly lost a large account to one of the national advertising publications that have an insert which they refer to as direct mail. This client owns a high end nursery and landscaping business. He likes the quality of our direct mail cards better, but stated that their insert costs less than half the price, around 10.5 cents. He showed me the sample left behind by the magazine’s rep, and it looked similar in size to our standard piece (and I must admit it looked pretty good). We chatted about the insert for a little while and I started asking some questions. The conversation went something like this:

 

“How many homes do they mail to in your zip codes?”

“Around 20,000”, he replied.

“That sounds about right if you add in PO boxes”.

“PO boxes? They never mentioned that”.

“Don’t sweat it. There are only around 250 PO boxes in these zip codes. Do you know how many businesses they send to?”

“Um, I don’t think so”

“Well, there are approximately 2000 businesses in the zips you mentioned. And how much business do you get from people who rent? Did you know that there are more than 4,000 rental properties in the community? That includes both apartments and people who rent private homes. And while we’re on the subject of homes, are you aware that more than 6,000 homes in your community are part of a homeowners association or condo? Do these people buy your services? Probably not.

My last question is regarding your customer base. You mentioned that you are more of a “high end” business. Since there is a large swing in incomes in the area, wouldn’t it make more sense to target the neighborhoods that are more likely to buy from you?

 

I think you can figure out the rest of the conversation from here. The point is that while “low cost” inserts may sound like a good alternative to direct mail, it often isn’t. The effective rate for this business was not really 10.5 cents per home at all, being closer to 27 cents per home to reach the 7800 qualified homeowners in the community. We never even touched on the increased visibility of having his own “stand-alone” piece vs. being in the pages of the magazine.

 

While direct mail generally requires a larger investment, the return is exponentially higher than any other display advertising, bringing back more than $12 for every dollar spent*.

 

*USPS January 2012

 

 

Neil Schwartz has over twenty-five years of advertising and marketing experience helping local businesses excel. He has received numerous awards for his outstanding achievements. Reach him at [email protected]

 

Categories: Press Releases

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