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Personalization, Omnichannel Strategies Drive 2020 Direct Mail

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AccuList’s direct mail marketing and mailing list clients embrace a channel that, despite perennial death notices, continues to outperform in terms of response, but mailers must also rely on evolving strategies for success in 2020.

2020 Success Depends on Data-Driven Personalization

Research consistently shows that personalization bumps up response. Most recently, in a 2019 NAPCO Research report on direct mail personalization, 44% of respondents saw personalized print marketing campaigns increase response by 16% on average, while Canon Solutions research found that adding a person’s name and other personalized database information (along with using full color) can increase the response rate of direct mail campaigns by up to 500%! So it’s no wonder that the recent Printing Impressions article by senior editor Toni McQuilken cites a number of leading marketing and print industry leaders stressing that data-driven personalization is the route to 2020 direct mail success. For example, Maureen Powers, president, Direct Marketing Group at RR Donnelley, asserts, “Personalization is more important than ever before, including with direct mail…We are using the direct mail channel to drive the customer experience through communications such as coupons and personalized offers. We’re also changing how we help our clients message their clients based on individual customer preferences and their point in the customer journey.” Likewise, Jim Andersen, executive chairman of IWCO Direct, stresses the shift toward variable data printing of smaller runs of targeted, personalized direct mail with digital tie-ins: “Today’s direct mail is more effective, relevant, and timely thanks to more sophisticated audience selection and segmentation. This technology uses digital print to personalize every component of a mail piece, including letters, inserts, cards, and call-to-action reply devices that connect the physical mail to an online, digital marketing experience.” 

Customer-Demanded Omnichannel Campaigns Mate Mail With Digital

For Andersen, mail personalization must be part of the omnichannel approach that customers demand today: “One of the biggest opportunities in the direct mail space is providing effective and efficient solutions to consumer demand for personalized, relevant messaging integrated across all channels. Insightful use of data, combined with the flexibility of digital print production, allows marketers to seamlessly integrate tactile marketing in their omnichannel campaigns.” Summer Gould, of Target Marketing magazine, has cited three already-proven ways to combine mail and digital:  1) online display ads that match direct mail data files to an IP address to target specific people by displaying cookie-free banner ads on web pages; 2) Facebook ads that match direct mail data with Facebook data to send targeted ads (see our Facebook Match services); and 3) e-mail matched with direct mail audience targeting to keep offers fresh, deliver response reminders and make added special offers (see our Digital2Direct services). The mail-digital mating can be taken even further to a union of programmatic automation with mail. Printing Impressions cites the example of Brodnax 21C Printers in Dallas, where Jim Singer, managing partner, describes their innovative program: “We take raw XML data to drive intricate, complex direct mail campaigns, including ongoing on-demand digital printing campaigns for local store marketing applications. Every night at midnight we get a massive amount of data, and the automated workflow we built for this programmatic offering” kicks in to generate direct mail campaigns and send them to production.

Data Quality Has Never Been More Paramount

These trends to more personalization and omnichannel integration rely on marketing data for segmentation and targeting, of course. Plus marketers must adjust for growing regulation of data security and privacy. All make data quality a top direct marketing priority in 2020. Yet too many marketers feel overwhelmed by the torrent of omnichannel “big data.” A Forrester Consulting 2019 survey revealed that, while 82% of companies place a high priority on refining data quality, more than a quarter of all marketing campaigns were hurt by substandard data in the last 12 months. Clicktale 2019 surveys of marketing and customer-experience professionals found almost a third of marketers don’t feel they’re effective at utilizing their web and mobile data, over half (54%) said they “don’t believe they have a strong understanding of their customers’ behavior across digital channels,” and 20% reported feeling like “they will never truly understand why their customers buy.” Check out this 10-step data-quality strategy from VisionEdge Marketing if you are looking for a place to start.

 

 

 

 

 

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Direct Marketing Challenged by 2020’s Record Political Spend

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AccuList’s direct marketing clients need to plan for competition for consumer attention across all media as political campaigns’ ad spending is forecast to hit record heights in 2020. Kantar’s Campaign Media Analysis Group (CMAG) predicts that political media campaigns will spend a record $6 billion on advertising in 2020, a 14.3% increase over the $5.25 billion spent in the 2018 midterm elections, and a 37.9% increase over the last Presidential campaign year in 2016, with the biggest gains going to digital media, which will nearly double to $1.2 billion in 2020. Meanwhile, ad media giant GroupM forecasts that political ad spending could reach a record $9.8 billion or more in 2020, again driven by digital ad growth.

Political Digital Competition Will Squeeze Inventory, Drive Up CPM

Nonpolitical marketers will face a considerable challenge, especially if they are advertising in politically divided markets, warns Kantar. For example, in the last three weeks of the 2016 campaign season, political advertising totaled 32% of local TV ad time within the battleground markets studied, an increase of 26% from the beginning of the season, while nonpolitical advertisers watched their share of the market plummet from 77% to 51%. Meanwhile, because digital is a big growth area for politicos in 2020, with a preference for programmatic advertising, marketing agency Hiebing warns that a scramble for digital inventory will significantly drive up CPMs for nonpolitical campaigns. Advertisers should develop a game plan early, either shifting campaign flights out of the election window or diversifying channels and tactics, Hiebing advises. Marketers should also consider Private Marketplaces, or PMPs, which are invitation-only marketplaces where selected programmatic media buyers make deals with publishers. These can offer access to more premium inventory, and better control over brand safety, than open exchanges crowded by 2020 political buyers.

Direct Mail Needs Careful Scheduling, Targeting, Stand-out Tactics

For direct mailers, it’s important to recognize that mailbox crowding will be especially bad around certain key events, such as the weeks before an election date, as well as early voting starts and the delivery of absentee/mail ballots. Marketing-mail drop dates need to be adjusted accordingly. Since bulk mail delivery is slowed, taking a back seat to first-class political promotions, mailers need to build in extra delivery time to the in-home date. Plus, in 2020, you will need to pay attention to the Super Tuesday primaries on March 3 because those primaries will see more impact (and more political mail) than usual as two of the nation’s most populous states, Texas and California, are among the 14-state total; indeed, Super Tuesday this year affects a whopping one third of the U.S. population. Bottom line: Careful planning of mail schedules will be required to get promotions in the hands of target audiences at the right time! Even with good timing, mailboxes are busier and response can be impacted, so marketers also need to make an effort to stand out creatively, perhaps changing up outer envelopes in size and color, and to avoid costly waste with more targeted messaging, via segmentation and personalization.

Marketers Win by Catering to Millennial Direct Mail Fans

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Remember when marketing gurus were calling direct mail “dead,” drowned by a wave of digital, mobile, and social technologies? Well, research keeps resurrecting mail from its low-tech tomb. In fact, recent studies find that Millennials–the 22- to 36-year-old, tech-savvy generation supposedly addicted to mobile devices and digital networking–are bigger fans of direct mail than older generations in some ways!  That’s information that printers, mailing services, and a list broker and direct marketing consultant like AccuList USA can use to convince clients who hesitate over direct mail spending.

Millennials Like Direct Mail in General

For example, a recent study by InfoTrends and Prinova found that response rates for direct mail remain high for all demographics, including Millennials, who open direct mail received at the same high rate of 66% as recipients overall. More significantly, Milennials as a group respond faster to mail–within 2.4 months–which is less than the average response time for all respondents. Plus, the InfoTrends research found that a big 63% of Millennials who responded to a direct mail piece within that three-month period actually made a purchase! Along similar lines, the U.S. Postal Service (USPS) and the American Association of Political Consultants (AAPC) conducted a survey on direct mail’s political impact on Millennials and found that at least 42% of Millennials prefer direct mail political ads over online ads, that twice as many thoroughly read political mail, and that Millennials are more likely to be prompted to action by mail, with 66% likely to research the candidate and 54% visiting the candidate’s website after receiving mail.

But Millennials Also Prefer Specific Mail Tactics

However, research also shows that all mail pieces are not created equal. Mailings that resonate best with Millennials are targeted and personalized, per research. Luckily, sophisticated targeting and personalization are possible with today’s variable printing, programmatic and automation programs, and database segmentation and analytics. Millennials demand printing quality as well, with one quarter of surveyed 25- to 34-year-olds saying they opened direct mail because of the print and image quality. Mailers going beyond the standard No. 10 envelope–including 3-D dimensional mailers, pop-ups and intricately folded pieces–are playing to this audience that appreciates visual creativity. Plus, engaging copy counts, with 25% of that same surveyed group saying they consider reading direct mail a leisure activity. That doesn’t mean that printed mail can be divorced from Millennials’ digital lifestyle. Data in eMarketer’s survey report “US Millennial Shoppers 2017” shows that Millennials prefer digital shopping, even while in stores, and are comfortable with mobile shopping. The Millennial preference for digital/mobile shopping means that integrating print and digital–via QR, AR, or PURL–can significantly boost response, as shown in multiple studies. Research also shows that video is a response-getter for Millennials’ digital promotions. And now mailers have the printing technology to jump on the video bandwagon with audio players and video screens incorporated in direct mail.

For a good overview of recent data on direct mail and Millennials, see this article from The Financial Brand.

What Data Questions Should Agency Agreements Address?

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As a data broker and data services provider, AccuList USA knows first-hand that the era of “big data” has created both greater opportunities and greater complications for marketers in terms of access and use of data. In fact, Advertising Audit and Risk Management (AARM), a North American provider of independent advertising audit and consulting services, recently urged advertisers and marketers to review agency contracts to make sure they address evolving “big data” issues.

Unanswered Data Questions Leave Risky Gaps

Data can drive a precisely targeted marketing strategy by leveraging insights from transactional and customer behavioral data–assuming that the advertiser/marketer has the right to receive and use that data. Based on their experience, AARM cites at least six key, but often unanswered, data questions that advertisers should cover in contracts. Those questions include:

  • Who owns the data?
  • Where is the data stored?
  • For how long?
  • How secure is the data?
  • Is the data kept separate from that of other advertisers?
  • Is your data being used to aid other advertisers?
Everybody Wants to Claim Valuable Data

AARM points out that data ownership is not automatically ceded to an advertiser or marketer despite investment in a media buy generating a data stream. Many within the media chain may try to claim the generated data: Ad agencies, trading desks, publishers, demand-side platforms, and third-party ad servers all may seek unrestricted access, if not ownership, of valuable customer data. That’s why marketers and advertisers need to be sure that legal agreements clearly and consistently spell out data ownership rights, privacy considerations and third-party access rights.

Guarding First-, Second- and Third-Party Data

Ownership and access to third-party data–often sourced from agencies and ad tech providers–is usually clearly spelled out in licensing agreements between stakeholders. But AARM notes that advertisers also need to be careful that second-party data, meaning information gathered indirectly from users via an advertiser’s relationship with another entity (such as an SEO platform or behaviorally targeted digital display ad), is used or shared in a privacy-compliant manner.  Advertisers must guard their first-party data, too, AARM cautions. For example, there are data privacy and security risks for first-party data used in programmatic digital and addressable TV buys, where unregulated, unsupervised use could violate privacy rights.

For AARM’s article, “Big Data. Big Deal. You Bet,” see https://marketingmath.aarmusa.com/2016/12/05/big-data-big-deal-you-bet/