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Direct Mail Marketing Costs
Getting a direct mail item out the door to a client or prospect—Nothing could be simpler, right? It depends…
While sending off the occasional package may be low-hanging fruit for your to-do list, delivering direct mail items at scale requires a lot of coordination—from choosing the perfect item to confirming shipping details and getting everything to its destination in one piece. Plus, you have to do it all without busting the budget.
That last piece can be tricky if you’re not considering every component of direct mail marketing.
While the digital revolution has given marketers unprecedented reach at a very attractive price tag, lowering the barrier to entry has had a predictable side effect: it’s made digital advertising world a much noisier place.
This shift in the marketing landscape has made it imperative to spend every marketing dollar wisely. Throwing the budget at paid ads is no longer a guarantee of success. In the search for innovative ways to make every advertising dollar count, many have discovered the best place to put them is in the mailbox.
But sending items at scale can be costly. It’s essential to carefully consider (and adhere to) a budget when committing money to direct mail marketing. Even more importantly, marketers need to be able to show the impact of their direct mail campaigns on ROI. With so many components and moving parts to consider, careful planning and solid reporting are essential.
Today we want to break down the individual costs of getting the perfect direct mail item out the door so you can have a complete picture of the costs and benefits, and harness the power of direct mail effectively and on-budget.
Direct Mail Costs: The Essential Ingredients
When considering the overall cost of a direct marketing initiative, many people think in terms of Item + Postage = Cost. However, the real cost per send is determined by many factors beyond the price of the item and the postage.
Cost of Direct Mail Items
Depending on the reason for the direct mail—prospecting outreach, candidate touchpoint, or individual thank you or celebratory item for a high-value account—you may spend as little as a few dollars, or far more on an item. Taking some time to consider the purpose and scale of your campaign will help you establish a feasible budget for the item itself. When determining your item budget, you should keep in mind:
- Volume-order items (things like high-quality tote bags, shirts, or practical swag items) cost less per unit—but lack the personal touch that can drive conversion.
- Conversely, highly personalized and valuable direct mail sends, like a personalized piece of clothing or an experience item (think airfare, concert or theatre tickets, etc.) are a higher investment but can drive conversions more effectively for high-value recipients or campaigns.
Deciding which way to go will largely depend on your campaign, recipient list, and desired outcomes.
Stumped on what to send? Our 167 B2B Gift Ideas for the Holidays eBook has many great sending ideas at a variety of price-points to help you select the perfect item.
Cost of Printed Direct Mail Pieces
Sometimes a piece of printed collateral is in order, or you may opt to send printed materials alongside your other item(s)—items like thought leadership pieces, informational one-pagers, case studies, or even a simple, effective hand-written note to personalize the experience. While these can deliver good value and can be an effective item for many recipients, the price of printing and shipping is only one part of the equation. A high-converting printed item must have excellent development (copywriting and graphic design), quality materials and binding, and excellent branding. Though more expensive, the ROI when you do it right is well worth the effort.
Cost of Direct Mail Packaging
Once you have your direct mail item selected and perfected, it’s time to get it packed up for shipment. But what you use for packing material is another area of impact for price and ROI.
The first consideration should be to ensure that your item will arrive in the same as it was shipped. Packaging that secures the item (such as bubble-wrap or air pillow film) is a great investment here. Festive packing touches like crinkle paper or tissue should also be considered, as they add the recipient experience. For slim items, bubble mailers are another option. (Check out page 13 of the above eBook for more info!)
While we know it’s “what’s on the inside that counts,” but don’t be shy when it comes to branded packaging. Having an item arrive with bold branding will cement the experience in your recipient’s mind (important when it comes time to close the deal.) Branded packaging may seem expensive, but it’s the most obvious advertising for your efforts.
For all of your packaging, consider sustainable and earth-friendly materials; recipients are placing more value on socially responsible products and practices.
Cost of Shipping Direct Mail
The moment has arrived! It’s time to send your finished product on its way. A few considerations before you drop off your package.
Depending on your item’s shape and weight, shipping a direct mail item can be a significant portion of the total price. Selecting a shipping provider will have an impact on your shipping costs. For instance, carriers like FedEx and UPS may offer faster shipping speeds, but higher costs at rack rate.
USPS may offer competitive rates for domestic deliveries that don’t rely on speed (for instance, perishable goods or time-sensitive campaigns).
Note: When shipping internationally with USPS or another carrier, customs documentation and fees may also change the bottom line for your package delivery, so be sure to consider these logistics when planning your campaign.
Cost of Direct Mail Automation
You may be thinking, “But if sending can be costly, does it make sense to invest in automation?”
While using a sending platform does mean some additional investment, there’s a host of benefits to outsourcing the process:
- The time investment your marketing team makes in picking, sourcing, packing, and shipping an item could be put to much better use elsewhere. It not only robs productive time, in effect you’re paying more than the price of automation to have high-value employees perform manual tasks.
- Using the power of integrations to bring together your marketing, sales, and customer campaigns with a Sending Platform enables you to bolster your current programs, and realize increased ROI from them.
- Using a platform allows you to track the ROI within your CRM, so you can see the results of your investment in black and white—making direct mail much less cost-prohibitive.
- Using a Sending Platform that offers free warehouse storage enables you to buy and store in bulk, reducing sourcing costs and saving considerable space in the process.
See how companies generate over 200% ROI on new revenue with the leading sending platform.
What Are the Average Open and Read Rates for Direct Mail?
The higher this is, the bigger the odds of converting the recipients. Unfortunately, direct mail isn’t like email, where you can track who opens your direct mailers. One WAY to test your direct mail campaigns is to see how many people convert into buyers.
For now, let’s see what the statistics say about direct mail marketing effectiveness:
- Direct mail recipients buy 29% more items and spend 28% more money (compared to those who don’t receive it)
- Roughly 42% of direct mail recipients read or scan through their mail
- The ROI for direct mail is 29%
- In America, 73% of consumers say they want to be contacted by brands via direct mail so they can read it whenever they choose
So does the effectiveness of direct mail marketing outweigh the cost of direct mail? It very well can if you can nail the demographic and the collateral you’re sending them.
Direct Mail Cost Calculator
So, the shipping equation for each direct mail send isn’t item + postage = cost. A direct mail cost calculator looks more like …
Item(s) + Printing + Fill + Packaging + Design + Time = Total Direct Mail Cost
In this equation, Time has the potential to become the largest (and perhaps costliest) investment for your team.
Even with the investment and the number of moving parts involved in a direct mail marketing campaign, the numbers speak for themselves in terms of ROI and results. Interested in a direct mail ROI calculator, as well? Look no further.
(Profit or Pipeline Generated / Total Direct Mail Cost) x 100 = Direct Mail ROI
If you are interested in saving money, and manual effort on your direct mail marketing campaigns, and (most importantly) saving many hours of time, a tactile marketing automation platform may be the right decision for you.