Last month we published a post regarding 10 direct mail stats you probably didn’t know. Today, we will tackle that age old marketing question — “Which direct marketing channel yields the best response rate and/or ROI?”
*(Some of the following data and statistics come from the DMA 2012 response rate report)
Direct mail response rates have dropped nearly 25% over the past nine years. Surprised? Well, you shouldn’t be as we all know direct mail is not the beast it once was in the direct marketing world. But, don’t discount how powerful direct mail marketing still is! Perhaps more notable ‚Äì even with the steady decrease in response ‚Äì direct mail campaigns still draw a much better overall response than digital channels. DMA offers this example: ‚Äúresponse rates for direct mail to an existing customer average 3.40%, compared with 0.12% for email, which is roughly a 30-fold difference.‚Äù
Email offers the best ROI. According to the report, email earned a 28.5 ROI, compared with 7.00 for direct mail. Even though the ROI is better, the response level is still nowhere near direct mail. The difference is that email has a much lower cost than direct mail. Because of the lower cost, email produces the best ROI, but not always the most effective method of communication.
The best response rate was actually…telemarketing. Telemarketing produced a response rate of nearly 13% on a house list. This shows the phone is still one of the best ways to connect with people on a one-to-one basis ‚Äì something direct mail and email just can‚Äôt match. On the other hand, telemarketing also had the highest costs: nearly $78 per order or lead for a customer supplied list.
Email = Lower Response/Lower Cost
Direct Mail = Higher Response/Higher Cost
Telemarketing = Highest Response/Highest Cost