How to Wisely Test Out Direct Mail Retargeting in 2021

How to Wisely Test Out Direct Mail Retargeting in 2021

If you haven’t tested direct mail retargeting yet, you may be missing out on a key tactic for 2021. As the cost of customer acquisition has gone up in the wake of COVID-19, hyper-targeting prospective customers based on their likelihood to convert is the wisest use of budget. With direct mail’s conversion rates at five to nine times that of email retargeting and digital ad retargeting, consumer brands in any industry can realize a more effective use of budget by layering in direct mail retargeting to stay in front of consumers who demonstrated interest. direct marketing response rates

Download our retargeting eBook, “Print and Pixels: Increasing ROI by Adding Direct Mail Retargeting” to learn more about why remarketing with direct mail is so effective.

Retargeting best practicesIndustries for direct mail retargeting

Direct mail retargeting strategy specifics will vary based on your situation, but here are some general best practices to consider as you begin to consider the tactic.

  • Identify your goal up front, and ensure your tracking mechanism measures against that specific goal.
  • Direct mail retargeting is most cost-efficient at 100,000 website visits per month or greater. At SG360°, we have one retargeting offering that is an exception to that rule, in a uniquely economical option for brands with fewer monthly visitors if your execution can work within some pre-defined parameters.
  • A 4.25 x 6″ postcard gets you a preferred postcard rate with first class service, which means it is delivered faster than standard mail. Due to the timeliness that is ideal with retargeting, and the lower cost of this sized postcard (larger goes out at first class rates), this format is almost always the best choice for maximizing return on investment.
  • It is best to use multiple creatives for personalization, but you must match the most appropriate level of personalization to your specific situation. For instance, in healthcare where personal health information (PHI) is a factor, the piece has to be more generic so as not to breach PHI. In retail, your customers may find it a little invasive to receive an image of the exact product they were looking at. Instead, we find the most success personalizing the piece to the category level, rather than the product level.
  • Consider a blackout window for individuals who visit more than once within a few weeks. You may suppress them for 14-30 days so as not to inundate them.
  • To start out, use the best offer that you currently have available. Be consistent with your offers across your marketing channels.

Start with a pilot program

You should always start your direct mail retargeting program with a test. Define your success criteria for the pilot up front, and if you meet that criteria, you can continue. Retargeting works best as an always-on program.

Your pilot program should last 14 to 90 days, depending on how much website traffic you have. As a guideline, one million monthly website visitors provides enough data to complete a pilot in 14 days. Your goal for the pilot length is to be able to evaluate results based on 25,000 pieces mailed over 90 days or less. Why is one million monthly website visitors the guideline in order to mail 25,000 pieces? Because you don’t want to blindly mail everyone. Here’s how the narrowing process works:

  1. Weed out the customers that regularly convert. You don’t need to mail them. Let’s say this is 10%. That brings you to 900,000 visitors.
  2. From there, you’ll have a 60-70% match rate for addresses. At 65%, that brings you to 585,000 visitors.
  3. From there, you only want to mail the top 25-35% who are most likely to respond to the extra marketing push. This is done with the data showing each visitor’s engagement patterns: how many times the visited the website, the number of pages they viewed, what they put in the cart, what categories they viewed, etc. At 25%, that gets you 146,250 visitors.
  4. From there, we can optionally help you target even further, maximizing your return on investment, by filtering for individuals who are known to have purchased via direct mail in the last 12 months. If you accept this recommendation, this may whittle your mail audience to around 25,000.

So, in order to do the maximum amount of data modeling helpful for the most return per mail piece, we recommend the one million monthly visitors. The reason for the 90-day maximum as a general rule is that you don’t want seasonality components to muck up your data. Ideally, you run the pilot and evaluate success as quickly as possible.

The direct mail volume within your pilot program can vary based on your testing budget. Consider what testing budget will make the effort worthwhile for you.

 

If you’d like to speak to us about piloting a direct mail retargeting program, contact us.

To learn more about testing direct mail programs of any kind, retargeting or otherwise, check out our on-demand webinar, “Testing Direct Mail for Maximum Profitability”.

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