| |
B2B Direct Mail Lead Generation Success Needs Planning, Testing, Measuring.
Is Direct Mail Useless for DMers?
Is direct mail useless at helping direct mail businessesgenerate leads?
That's the question I was asked last week by a reader of AlanSharpe's B2B Direct Mail Tactics newsletter. Here is her unusualchallenge, and my response.
"My biggest challenge in generating leads from direct mail is toconvince our marketing people that direct mail should be used.This is a completely ironic situation given that we are a DIRECTMAIL HOUSE. Yes, that's right. I've been told that 'direct mailis not good for our business.'
"Apparently, direct mail was tried once long ago and had a badresponse rate. Our other lead generation methods include salesoutreach activities (prospecting, networking, etc.) andcommunity involvement - charities, boards, councils, etc. Ourword of mouth reputation is excellent - we've been in businessfor 18 years, our turnaround time is excellent, our customerservice people are top notch, our team really knows their stuff. . . . However, it seems to me that a larger outreach should bedone as well . . . am I barking up the wrong tree here?"
Myth #1: Direct mail doesn't work for us
The only way to convince management to use direct mail over thelong term to generate sales leads is to prove that direct maileither outperforms other methods or increases the effectivenessof other methods. You can only do this through testing andmeasuring results.
After all, the telephone, not the letter, is the number onetactic to generate leads according to the Direct MarketingAssociation's 2005 Response Rate Report.
Your firm sounds like it is content to do business in your cityonly. That's why they rely on "networking, community involvement- charities, boards, councils, etc." These methods of meetingprospective clients are not sustainable nationally or evenregionally. They are too expensive.
Unless your management wants to grow the business outside ofyour city, or grow the business in an aggressive way in yourcity, you may have a hard time convincing them to try DM. Thisis especially true if your city is small, since your prospectpool is so limited.
Myth #2: We tried it once and it didn't work
You say, "Apparently, direct mail was tried once long ago andhad a bad response rate." Business-to- business lead generationusing direct mail is a program, not a campaign. It consists of aplan, a year-long series of mailings,
and a way of testingmethods and measuring results. I would suggest that if you havenot tried direct mail consistently for at least a couple ofyears, testing different packages against each other, testing DMagainst your other lead generation methods, and measuring yourresults to see which method is most cost-effective, you haveabandoned direct mail prematurely.
Myth #3: Direct mail delivers poor response rates
You say, "Apparently, direct mail was tried once long ago andhad a bad response rate." Direct mail response rates aremisleading if you read them incorrectly. Your response rate onlytells you part of what you need to know. It tells you thepercentage of people on your list who responded and nothingmore.
Your response rate doesn't tell you how much you had to spend togenerate one lead. Or how much you had to spend to make onesale. Your direct mail response rate does not tell you if thesales people who followed up on the leads closed any sales. Orif you broke even. Or if you made a profit.
So don't be fooled by a low response rate. Unless you measurethese other things (cost per lead, cost per sale, break even,return on investment) and compare your results with yourface-to-face prospecting, community involvement and othermethods, you will always be relying on feelings and not facts.One of the things that I like about B2B direct mail leadgeneration is that it is empirical. The numbers never lie. Youcan bank on it.
Recommendations
1. Show your boss a compelling business case for testing directmail lead generation at your firm. Calculate cost per lead, costper sale, break even and ROI. Show your boss the numbers
2. Start with a list of prospects that have been unresponsive toyour other methods, or people that you cannot reachcost-effectively any other way
3. Think niche. Target a narrow group of prospects and go aftertheir business with a year-long campaign, reaching them moretimes and in more ways than your salespeople ever could in a year
I wish you every success!
About the author:
Alan Sharpe is a business-to-business direct mail copywriter andlead generation specialist who helps business owners andmarketing managers generate leads, close sales and retaincustomers using business-to-business direct mail marketing.Learn more about his creative direct mail writing services andsign up for free weekly tips like this athttp://www.sharpecopy.com.
|
