Direct mail has shaken off its junk mail tag. Companies are investing more in direct mailings and recipients are more likely to respond than ever before.

The beauty of direct mail is that it is a cost-effective advertising medium, so a campaign can soon pay for itself. But direct marketing is most effective when it is developed over the long term as part of a commitment to relationship marketing.

Direct mail can help you to get to know your customers, tell them about your products, communicate your brand values and establish a relationship that brings long-term loyalty.

For new companies, a little planning and patience is required. You have to begin by compiling your database, because you need the right levels of information to target your best prospects. And you may have to create a rapport with those prospects before you can sell to them.

Direct mail or door to door?

Your first big decision is how to deliver your direct marketing messages. Businesses that rely on local trade may be able to reach almost all of their prospective customers in a door to door delivery exercise. For example, Ikea delivers its catalogue to homes within 60 minutes' drive of its stores.

Door to door enthusiasts include retailers, charities and fast moving consumer goods (fmcg) companies, such as HP Foods and The main advantages of door to door delivery are cost and the breadth of coverage. And, by delivering items with a reply mechanism, such as requests for information or competitions, companies can use the responses to build their own database of prospects.

The best response rates from direct mail marketing are achieved when items are enclosed in an envelope and delivered with the morning mail. Typical items involved in direct marketing include samples, coupons and catalogues.

In 90% of door to door deliveries, some kind of targeting has been used. For instance, specialists such as Circular Distributors use address mapping and postcode systems to select which houses and areas to target. The Royal Mail also offers a door drop service.

Direct mail marketing does have advantages over door to door, even when the majority of customers are located within one area. It provides much more precise targeting, allowing different messages or offers to be sent to different types of prospective customer. Recipients often prefer the personal touch, with letters correctly addressed to them rather than to the occupant.

Make sure that you keep an accurate record of the success of your direct marketing campaigns. Therefore as response to the mailings grows, so does the information held on the database, allowing further targeting and ultimately boosting sales. Direct mail is used by all sectors.

According to the Direct Mail Information Service (DMIS), the average British household receives 12.8 items of direct mail every four weeks. And business managers are sent an average of 14 direct mail items per week. Consumer acceptance of direct mail marketing has risen steadily in the past ten years. Research by the DMIS reveals that:
• 77% of direct mail is opened
• 63% of consumers read the contents

Setting objectives and managing costs

To get the most out of a direct mailing, it is vital to set your objectives. This will help you to evaluate the results and manage the costs. Your ultimate objective will be to produce sales but your mailing could be the first step on the path to sales success. It could be designed to simply introduce your brand and give out information.

Mailing samples, for example, can bring a long-term sales lift as consumers are converted to a new product. And mailings that require a response – such as special offers and competitions – will highlight those consumers that are warm to your product and should encourage you to mail them again.

One of the benefits of direct mail is that you can measure the response, which in turn allows you to manage your costs and maximise sales.

The cost of a mailing is made up of the following:

• The cost of renting or compiling a mailing list.
• The cost of the raw materials – paper, envelopes and stamps.
• Any labour costs arising from the production and dispatch of the mailshot.

A mailing to 1,000 addresses could cost just £250 and the average consumer purchase resulting from direct mail is £80. However, the response you are seeking will depend on the value of what you sell. A furniture maker could cover its mailing costs with one or two orders but a stationery supplier would need to bring in a lot more custom.