Direct Mailing

views updated

Direct Mailing

What It Means

Direct mailing is a form of what is called “direct marketing.” Marketing is a multifaceted strategy for selling goods, services, and other products; it entails research, advertising, pricing, promotion, placement (or distribution), and other activities designed to connect the product with the segment of people who will be most likely to buy it. When successful, marketing activities enable a company to perceive, understand, and satisfy consumer wants and needs.

Direct marketing, also known as direct-response marketing, is a specialized form of marketing in which promotional messages are delivered to a target population of people who have been identified as potential customers. Direct marketing’s focus on attaining measurable results that can be tracked over time is what distinguishes it from other forms of marketing, wherein the effects of certain strategies can be difficult to verify. For example, Tangles, a new hair salon catering to young people, might use a direct-marketing campaign to hand out hundreds of leaflets on a college campus. The leaflet contains a coupon for $5 off a haircut; Tangles can therefore measure the success of its campaign—the number of customers it has attracted—according to how many students bring the coupon into the salon for a haircut. Similarly, Tangles could buy an advertisement on the college radio station KZAP; if the ad concludes with a line such as “Say you heard about us on KZAP and receive $5 off of a haircut,” the salon can also measure the results of this ad by counting how many customers mention it. Indeed, any advertisement that asks the audience to respond with some direct action (such as returning a postcard, calling a toll-free number, entering a free raffle, or visiting a website) may be categorized as direct marketing.

Direct marketers deliver their messages via television, the Internet, e-mail, billboards, magazine inserts, and other media. Still, the most prevalent form of direct marketing is direct mail, in which marketing messages are delivered through the postal service. The marketing pieces used in direct mail can take a number of forms, from a simple postcard with the customer’s address on one side and a promotional message on the other, to a “value pack” envelope stuffed with coupons for a variety of local businesses, to a magazine-style catalog containing dozens of items for sale. In the United States and other industrialized countries, the volume of direct mail represents such a significant portion of the total mail circulation that a special rate class (called bulk mail) has been established to handle it.

When Did It Begin

The practice of advertising by mail can be traced to the invention of the printing press by Johannes Gutenberg (c. 1390–1468) in Germany in the mid-fifteenth century. It did not become widespread, however, until the late nineteenth century. In 1872 American salesman Aaron Montgomery Ward (1844–1913) launched the first mail-order business by sending out a one-sheet catalog that consisted of a list of goods for sale, along with prices and ordering instructions. Three decades later Ward had expanded his catalog to a four-pound volume, which was mailed to three million customers. Ward’s success led many other businesses to adopt direct-mail advertising techniques, and the industry grew rapidly: in 1917 a trade organization called the Direct Mail Advertising Association was established, and in 1928 the U.S. Postal Service introduced third-class bulk-mail postage rates to accommodate the large volume of direct-mail advertisements.

Direct mail as we know it today, however, was not introduced until the early 1960s, when Lester Wunderman (b. 1920), now hailed as one of the great marketing visionaries of the twentieth century, conceived of direct marketing as an interactive process between business and customer. Wunderman observed that people’s desires and tastes were becoming increasingly individualized and that shopping was developing into a form of personal expression. Seeking to address the needs of the individual customer, he defined direct mail as a “system of interactive transactions that would restore a measure of dialogue and human scale to the way we made, sold, and bought things.” One of Wunderman’s legendary direct-mail success stories was his creation of the Columbia Record Club, which offered customers a free record when they joined the club and enabled members to buy records from a mail-order catalog. The public response to the record club was overwhelmingly positive and suggested the enormous potential of direct mail.

More Detailed Information

In order to use direct mail effectively (that is, to attain the largest number of responses from the marketing pieces that are distributed), marketers conduct demographic research to determine their target audience. Population demographics include a wide range of statistical data about the people that make up a society, including age, race, sex, education level, occupation, income, marital status, number of children, and other information. A marketing agency that is preparing a direct-mailing campaign collects this information so that it can target a specific group of people, such as “single African-American women under 30 with college degrees” or “divorced dads over 40 with blue-collar jobs.”

Marketing agencies collect demographical information from a number of sources, including the national census (a government survey of the population). Although the census itself is anonymous and marketers cannot get names or private information directly from it, it does help marketers to derive information about people. For example, using information contained in the census, marketers can infer things about a person’s income level and lifestyle based on his or her zip code. Also, many companies are in the business of compiling and selling specialized mailing lists, so a business that wants to launch a direct-mail campaign can select the particular demographics it is looking for and buy a list of all the addresses in a certain area that fit those criteria. For instance, if a high-end day-care business is trying to boost its enrollment, it might buy a list of addresses for families in the area with children under the age of 10 and both parents working professional jobs.

How do mailing-list companies get this kind of information in the first place? Information about the purchases a person makes is often retained by the businesses, sold to the direct-mail organizations that compile the lists, and then resold to other businesses that are seeking to target similar consumers for their direct-mail campaigns. Say, for example, that you buy a new camera. In the box with the camera is a postcard that offers you a two-year warranty; all you have to do is complete the product-registration information that is requested and send the postcard in. A few weeks after you do this, you start receiving promotional flyers in your mailbox for Photosaurus, a new photo-printing business only a few miles from where you live. The flyer promises a free roll of film with your first set of prints at Photosaurus, if you bring in the postcard. But how did the Photosaurus know that you might be looking for a place to print your pictures? In all likelihood, the camera company sold your name to a direct-mail organization, which, in turn, sold it to Photosaurus. Product-registration cards are just one of many ways that companies can track what people buy and predict what they might buy in the future. If a person belongs to a professional organization, fills out a survey, signs a petition, or donates to a charity, it is likely that the information he or she gives will make its way to a mailing list. Also, any time someone registers a change of address with the post office, that information is sold to direct-marketing companies.

Recent Trends

Instead of simply broadcasting advertisements out into the world and hoping for good results, businesses can use direct mail to customize their marketing initiatives and aim them directly at the segment of the population that is most likely to respond. Still, using direct mail as a marketing strategy is not without its downsides. First, many consumers resent getting unsolicited mail, regarding it as both an invasion of their privacy and a waste of paper. In some cases, then, a business that uses direct mail might actually alienate a potential customer who would have been more receptive to some other form of marketing. Also, even after such careful targeting of its audience, a business has no guarantee that a mail recipient will open, or even look at, this advertising mail. Indeed, studies show that huge volumes of direct mail are thrown into the trash unread.

Since the 1990s privacy advocates have become increasingly active in the effort to help people avoid having their personal information sold to direct-mail organizations and their mailboxes flooded with unwanted marketing materials. In the United States one of the first steps to halting the influx of direct mail is to register with the Direct Marketing Association’s Mail Preference Service. Once someone registers, his or her name and address are added to a “do not mail” file, which is updated monthly and distributed to direct marketers several times per year.