Email vs. Direct Mail: The Contest of Cost & Conversions
Email and direct mail. These two have been battling it out for years.
There are plenty of myths about both. Direct mail can’t be targeted. Email can’t be done at scale without going to Spam. Or my favorite myth, that they’re both “dying” channels (when people still check their mail and email, with study after study showing that email is still preferred and used daily even with younger generations).
As a multi-channel data provider, I know the power of these channels to drive sales and, chances are, your strategy may include both. Today most marketers realize that the best campaigns have an omni-channel approach, utilizing triggers and sequences to guide prospects through the buying journey with the right resources along the way. For example, I often recommend that clients trigger direct mail or display ads after an email is opened.
But if you’re stuck on a metaphorical deserted island and can only choose one, which one do you pick? Let’s take a look at how these channels line up side-by-side in some of the most important areas.
Reach & Targeting
It’s true that almost everyone lives somewhere, but almost everyone also has an email address. Figures from Statista estimate there were 3.9 billion email users in 2019, with that number expected to grow to 4.3 billion users by 2023. Both email and direct mail can be segmented by many factors to reach prospective customers that fit your needs. But email is personal. Several people may share an address, but email is usually specific to the individual. Email marketing offers the ability to zero in on specific targets, based on their online and offline attributes, in order to reach their inbox.
Email is recognized as one of the most cost-effective and scalable marketing channels, and direct mail can be inexpensive too, but only for low-cost mailers such as postcards. When planning an email marketing campaign, some of the costs include design, content, the email platform, and the contact data. With direct mail, you have the cost of design, content, mailing list, the physical paper and printing, and of course, postage. The U.S. Post Office recently announced it will increase rates for postage from $0.55 to $0.58. When multiplied across the many recipients of campaigns, that means a dramatic cost increase for direct mail.
You can’t talk about cost without talking about return. When comparing channels by return on investment (ROI), email can’t be beat. It’s estimated that for every dollar spent on email marketing, you can expect a return of $42. And the increase in the cost of postage inevitably means the ROI for direct mail is decreasing.
Looking at email and direct mail, which one is more accurate in reaching the intended recipient? It’s a big question. In general, mailing addresses don’t change that often. While email addresses—especially business contacts—can change all the time. And that’s one of the biggest concerns some marketers have had with email, especially for acquisition campaigns.
For a time, people thought it wasn’t possible to use third-party contact data at scale without ending up on email blacklists that cause reputation damage or having emails go straight to Spam and remain unopened. And especially with today’s increased privacy regulations, these concerns are legitimate—if you’re not using high-quality contact data.
Quality data providers know their data is accurate and will stand behind it. For example, at OMI we guarantee 95% email validity for our contact data for the first 30 days. With high-quality data, you can be confident in your acquisition email campaigns without having to worry about what will happen if you have too many bounces. And higher-quality contact data—made up of highly targeted contacts that match your customer audience—will result in higher response rates.
Some studies report that up to 90% of direct mail gets opened. Wow. But what happens after? Did they simply check to make sure it wasn’t a bill and throw it away? Did they spend a few minutes looking it over, their interest piqued, and forget about it? Did they immediately make a purchase? It’s hard to know.
However, if an email is opened — you know. If a link is clicked — you know. If two links are clicked … well, you get the picture. You also know when it was opened, who opened it, and the type of device they used to open it. Email marketing offers a ton of data you can gather for insights into the mind of your prospect and what works best. Emails are also dynamic—with the ability to embed or link to videos, interactive content, or directly to buying options or to contact a sales representative.
With email, you can gain insights into the entire customer journey. You can personalize the next message you send based on the prospect’s demographics and the behavior they’ve taken when viewing the email. But with direct mail, these insights aren’t available, which means it’s not possible to personalize message two, three, etc. – unless your efforts are combined with information/data emanating from other channels.
You also have to consider that B2B sales cycles are complex. It can take upwards of 10-15 touch points to convert a prospect. With email, these touches can occur at a pace that aligns closely with the prospect’s journey and preferences. Conversely, in most cases, not even the fastest direct mail production process would be able to execute 15 touch points with the right message at the right time at scale. In fact, as a stand-alone channel, direct mail just can’t compete with the speed and personalization of email.
Both methods offer ways to know if your marketing worked and led to a sale. With direct mail, that usually includes mentioning the mailing offer or physically entering the printed code on a website. Email, on the other hand, is as easy as a click.
Email is fast, direct mail is … not. The benefits to this are many—from being able to send out timely, relevant campaigns to the ability to see how a campaign is performing and adjust quickly.
Thinking about email and direct mail marketing from a buyer perspective, the results can go both ways. Do buyers like having a physical mailing that’s both tactile and visual? Or do they think it’s wasteful and not environmentally friendly?
Are they tired of getting emails? Or is it the most convenient place to receive and review offers?
There will always be pros and cons to every marketing channel. That’s why it’s important to know the facts.
The bottom line is this: email offers a cost-effective way to reach new customers with the best ROI. And when you’re using high-quality data from a reputable provider, you can be confident in the accuracy and powerful results that email campaigns deliver.