Direct Mail and Digital Marketing: Partners, Not Rivals

direct mail and digital marketing

Bricks to Clicks

At first glance, the battle of direct mail vs. digital marketing may seem like a classic either/or choice. For years, both strategies have had their supporters and detractors, always ready to defend their favorite. Each technique offers advantages that are boosted by marketers, companies, and organizations as the best way to meet their goals. The reality is, though, that to drive the best ROI and engagement, both methods have to be carefully considered.

In this article, we will look at the advantages and challenges of both direct mail and digital marketing. Through looking at the differences between the two, we’ll help you decide which one works better for your business or organization overall or for specific campaigns.

The Power of Tangibility: Direct Mail

Direct mail marketing works well today based on more than a century of experience. Ink on paper, with all of its longevity, has both pros and cons to be weighed by businesses of all sizes.

Advantages of Direct Mail

The best reasons to use direct mail have been well-known for many years and include:

  • Familiarity by both marketers and audiences, including digital-first millennials and Gen Z

  • Ability to reach large, broad audiences easily in more places

  • Multiple physical designs and formats

  • Trusted for transactional, legal, and operational messaging

  • Wide variety of physical, tactile experiences are possible because of appeals to senses (sight, sound, touch, smell)

  • Longer and deeper brand and message recall

  • Segmentation and personalization (through VDP) increasingly used to right-size marketing campaigns and spend

  • Less physical clutter compared to digital

  • Measurable tracking and attribution through matchback, QR codes/PURLs, and call-tracking software

Challenges of Direct Mail

Direct mail, especially in less-experienced hands, may have some limitations, such as:

  • Less two-way audience interaction

  • Longer lead time usually needed to plan and execute campaigns, as well as make changes based on testing and results

  • Variability in production costs due to labor and materials issues

  • Increasing postage rates

  • Expertise in some channels and methods is less widespread than in the past

Digital Marketing in the Digital Age

Digital marketing includes many online marketing techniques, such as:

  • Email marketing

  • Text/SMS

  • Video

  • Websites

  • Pop-ups

  • Pay-per-click ads

  • SEO

  • Apps

  • Podcasts

  • Social media marketing

  • Automated/programmatic marketing

So, the growth of digital channels in the last 20 years has been impressive. However, no strategy is perfect in every campaign for every brand. To achieve success, the pluses and minuses must be evaluated and balanced against each other.

Advantages of Digital Marketing

As some technologies mature and others are introduced and deployed by marketers, the advantages of investing in digital channels have become more apparent. They include:

  • 1-to-1 personalization

  • Lower costs for many types of campaigns

  • Faster deployment of campaigns

  • Real-time response tracking and analytics

  • Wide reach across national barriers

  • Adaptability to a wide variety of platforms and devices

Challenges of Digital Marketing

The limitations of digital marketing have also become more apparent as audiences mature and marketers adjust to a quickly changing landscape. Here are the main challenges to growth:

  • Digital fatigue as consumers are overwhelmed with messages & platforms

  • Competition continues to grow

  • Privacy and data security concerns in response to hacking, misuse, etc.

  • Ad blockers limit reach to internet users

  • Algorithms evolve to better capture search activity, ad placement, etc.

  • Software and hardware platforms evolve in response to consumer and marker preferences

  • Attribution often limited or not precise

  • Technologies depend on power and internet access

Investment Breakdown: Exploring Costs – Direct Mail vs. Digital Marketing

When deciding on a channel in your marketing strategy, one crucial detail to consider is the budget for the campaign. One long-time myth is that digital marketing is cheaper than traditional marketing. Considering all of the factors that can affect the cost of a campaign run in a single channel – any channel – it’s impossible to say which method of marketing is cheaper. Instead, think of how your costs need to be balanced against other elements, and how those may affect your goals.

Please note that the investment amounts referenced here are reflective of mid-market and enterprise-level companies.

Breakdown of Costs in Direct Mail

A lot of factors and variables make up your direct mail costs. Each comes with its own advantages that have to be carefully weighed against others when planning your direct mail marketing. Here’s a breakdown of some of them:

  • Fixed costs – standard expenses for services or goods that don’t change regardless of the quantity mailed or client such as set-ups, project management, design and copywriting, and consultation fees

  • Variable costs – charges for items or services that usually change from one campaign to another, such as data (lists, tracking and analytics), postage (depends on quantities mailed, format, mail class, etc.), printing (paper, ink, coatings/finishes, printing process, quantities produced, printing process, labor)

Breakdown of Costs in Digital Marketing

Digital marketing costs vary significantly depending on which channel is being used in your strategy. And for each channel you’re in, your company size and industry vertical also play a role. Generally speaking, total costs may fit into specific (but wide) ranges for channels like:

  • Email – $10,000-$1 million per month (software, list management, design & copywriting)

  • Pay-Per-Click (PPC) – $100,000-$500,00 per month (ad spend, keyword bidding, management)

  • Social media – $10,000-$100,000 per month (ad spend, content creation, community engagement & planning)

Targeting and Personalization

Data – and how to use it well – is a critical factor in both direct mail and digital marketing success stories. Instead of putting an audience on blast, focusing on specific segments or individuals with more relevant offers and messages saves money (improving ROI), strengthens loyalty and the customer experience, and results in greater retention and more sales.

Targeting Capabilities in Direct Mail

Data segmentation is a powerful way to target customers and prospects by specific groups to drive action. For example:

  • Geographic – their physical location (e.g., city, state, zip code, neighborhood or target radius)

  • Demographic – their personal characteristics (e.g., age, gender, income)

  • Behavioral – their customer activity, such as buying products and services, using the RFM (Recency, Frequency, Monetary) model

  • Psychographic – their attitudes and values, interests, and more broadly, lifestyle, all form a personality profile

Variable data printing (VDP) allows customers to be targeted on a 1-to-1 basis with a mail piece that includes a personalized offer, headline, image, or other element from hundreds of possible data points. Results show that personalized mail pieces, because they have a higher perceived relevance and value to the recipient, achieve a higher conversion rate than non-personalized ones.

Personalization Features in Digital Marketing

By its nature, digital marketing is precise when it is based on data. And like direct mail, it is powerful when it drives action along every part of the funnel to prompt action by customers.

  • Behavioral targeting – their online behavior and interactions (e.g., completing forms, searches, browsing/shopping from pages)

  • Customized content and messaging – demographics, interests, behavior, and intent can all be leveraged to create personalized emails, ads, and content (e.g., product suggestions)

Thanks to VDP, these same strategies can also be used to target audiences using always-on direct mail triggers. This results in higher conversion rates and better customer experience.

Measuring Success: Analytics and ROI

The success of a direct mail or digital marketing campaign can be measured in a variety of ways, but the one that’s important to most marketers is return on investment (ROI). By comparing what you get back in purchase or other metrics with what you spend, you can make adjustments to optimize your next campaign.

Tracking Direct Mail Campaign Success

Direct mail success can be measured by looking at three key figures:

  • Response rate – Divide the total count of responses by the number of pieces mailed, then multiply by 100

  • Conversion rate – Divide the number of sales by the total number of responses, then multiply by 100

  • Return on Investment (ROI) – Subtract revenue generated by the mail piece from the campaign costs, then divide by the campaign costs. Next, multiply that result by 100 to get the ROI figure

To maximize the value of your direct mail campaign, consider and test ways to reduce your costs while not affecting response. 

Analyzing Digital Marketing ROI

To understand the effectiveness of your digital marketing, use tools like Google Analytics to track, then review key measurements of actions taken by the customer:

  • Click-through rate – Divide number of clicks received for an ad by number of impressions (number of times) the ad is shown, then multiply by 100

  • Conversion rate – Divide number of conversions by total number of ad interactions, then multiply by 100

  • Bounce rate – Divide number of single-page sessions by number of sessions by all web visitors, then multiply by 100

  • Social media engagement – Divide total number of interactions by total number of followers, then multiply by 100

Reviewing data on these metrics helps you identify patterns or trends that can inform decisions about how to refine strategies in your channel(s) and/or your spend to achieve better results.

Integrating Direct Mail and Digital Marketing

How you reach customers and prospects will vary depending on your audience, budget, time, and other factors. In some cases, either direct mail or digital may work best at producing that all-important ROI that you desire. On the other hand, some campaigns may work best when they incorporate both. 

When you combine direct mail with your digital marketing efforts, you can:

  • Generate more leads and develop buyer personas from data collected from more online and offline touchpoints

  • Attribute actions and sales to the correct channel

  • Build or reinforce your digital branding and loyalty with direct mail pieces that provide staying power as well as pass-along value

  • Target segmented audiences with personalized copy, images, and offers, thanks to variable data printing (VDP)

  • Achieve higher response rates than sending out emails alone

  • Engage customers at a deeper level

Digital marketing will not entirely replace traditional marketing. Instead, both forms of marketing are evolving to coexist in the marketplace. When both are available, they offer marketers a full range of options for their marketing campaigns, helping marketers decide what methods or combinations work best to meet their goals. 

Synergies between Direct Mail and Digital Channels

When integrated with multichannel marketing, data-driven direct mail is an even more powerful tool in creating and deepening customer relationships.

For example:

  • QR codes – When scanned on a direct mail piece, they provide a bridge to a digital experience, such as a landing page or an app

  • Informed Delivery – A free preview image of a coming direct mail campaign by itself can build anticipation in the customer for their mail delivery, but a dedicated (and free) USPS campaign is an opportunity to directly connect them with an online channel immediately

  • Retargeting/Programmatic mail – Meeting customers when they are on a website triggers the send of a direct mail piece that makes the conversion

Tips for a Comprehensive Marketing Strategy

Ultimately, people don’t buy based on your channel. People buy for four reasons:

  • Price

  • Service

  • Exclusivity

  • Quality

The challenge is in figuring out which channel best communicates any or all of those reasons to your target audience for that campaign.

To get started:

  • Define your audience or segment

  • Set your goals and how they’ll be measured

  • Choose the right channel or combination of channels

  • Develop your messaging

  • Create a marketing plan with specific tactics

  • Track results & KPIs

Wrapping it up

The benefits of direct mail marketing – as noted above – are many and well-understood. It’s one of many reasons has grown and thrived for over 50 years. At the same time, we know how to create digital marketing campaigns as part of an integrated marketing strategy that improves your overall conversion rates and ROI. 

Looking for a direct mail marketing partner that can help you build a unified customer experience across channels? Contact our team today to talk about how we can help your company or organization!

More From the Blog