Blog: Marketing and Social Media

Direct Marketing Association

The Direct Marketing Association (DMA) released their 2012 Response Rate Report on June 14. Bottom line: the report concludes that direct mail response rates are slipping, but they’re still higher than most other media.

Also included are marketing benchmarks that all marketers will find meaningful – cost and performance benchmarks – and help them assess the efficiency of their own direct marketing campaigns.

Transactional Data Aggregated – 29 Billion emails

For the first time in its eight consecutive annual publications, it includes Transactional Data from Epsilon and Bizo. Quite significantly, the data aggregates more than 29 billion emails and more than two billion online display ads.

“With transactional data, we have sample sizes in the millions, even billions of impressions and emails,” said Yory Wurmser, DMA’s director of marketing and media insights.  “Transactional data has an edge on survey data for two reasons:  First, sample sizes are big enough that it’s possible to break the data down into more industries, with more significant findings.  Second, transactional data tends to be more accurate, since it takes the human element out of the assessment and shows exactly what happened.”

Direct Mail Response Rates Over Time

The 2012 report compares direct mail response rates over time, another new addition. This revealed that over the past nine years, response rates have declined almost 25%.

Even with this drop, the DMA clarifies that mail campaigns produce a better overall response than digital channels. While direct mail to an existing customer results in a 3.4% response rate, the same size email campaign to existing customers results in a 0.12% response rate – close to a 30-fold increase!

Cost-Per-Lead And Cost-Per-Sale

Interestingly, the DMA report claims that because direct mail costs are higher than email costs, a campaign nets roughly the same financial cost-per-lead and cost-per-sale for direct mail, email and paid search.

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According to the report – other important findings include:

• Transactional data show that only six percent of the actions following an online display advertisement occur immediately following a click, which indicates that click-through rate greatly underestimates the impact of online display.
• Transactional data show that financial services emails had open rates above 30 percent, which ranked the highest among industries.  Retail (Apparel) had open rates averaging 14.7 percent, which narrowly was lower than Publishing & Media (14.9 percent).  In contrast, data showed Publishing & Media as having the highest action rates per impression (0.013 percent).
• For emails, the highest click rate to open rate is for CPG (46.5 percent).
• Cost per order or lead for acquisition campaigns were roughly equivalent for direct mail ($51.40), post card ($54.10), email ($55.24), and paid search ($52.58).
• Email had the highest ROI (28.5), compared with 7.00 for direct mail.
• Email performance went up slightly from the 2010 Edition of the Report.
• The highest response rates—nearly 13 percent to a house list—was produced by telephone marketing.  Telephone marketing also had the highest costs: nearly $78 per order or lead for a house list, and $190 for a prospect list.
• Costs were generally higher for B-to-B campaigns than for B-to-C campaigns.

DMA’s 2012 Response Rate Trends Report is available for purchase through DMA’s online bookstore.  The cost is $249 for DMA members and $499 for non-members.  To purchase, click here.

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ABOUT Lisa M. Chapman:

Ms. Chapman’s new book, The WebPowered Entrepreneur – A Step-by-Step Guide will be available on July 10, 2012 at Amazon.com: http://amzn.to/MyaQmp and on July 12, 2012 at Barnes & Noble: http://bit.ly/M5T0KO .  Lisa M. Chapman serves her clients as a business and marketing coach, business planning consultant and social media consultant. She helps clients to establish and enhance their online brand, attract their target market, engage them in meaningful social media conversations, and convert online traffic into revenues. Email: Lisa @ LisaChapman.com