As someone who has worked with direct mail and printing companies all my life, I have always been biased and had a feeling it would gain in impact as everyone knee-jerked to deploying digital mediums only, losing sight of tactics that worked. I once sent direct mail to a single person using the “bulky mail” tactic and got him to return my call, providing a long-term customer to my client. I’ve witnessed its effectiveness firsthand!
The 2023 Association of National Advertisers (ANA) Response Rate Report reveals that direct mail has emerged as the top performer in return on investment (ROI) among various direct marketing channels. Published in February 2024, this comprehensive report highlights the benchmark performance and cost data for 2023 across direct mail, paid search, digital display, email, social media, and SMS.
Key Findings from the 2023 Response Rate Report
Direct Mail Return on Investment
According to the ANA report, direct mail achieved the highest ROI of 161% when sent to house lists, outperforming all other marketing media. Email to house lists follows with an ROI of 44%, while social media advertising rounds out the top three with a 21% ROI. This data underscores the effectiveness of direct mail in generating significant returns compared to other channels.
Most Used Direct Marketing Media
The report indicates that email marketing and social media advertising are the most widely used media types for direct marketing campaigns in 2023, with an 80% usage rate for each. Digital display advertising (67%), direct mail (52%), and paid search (51%) are also among the top five most used media. Each of these media types has seen an increase in usage compared to the 2022 study.
For many businesses, solo direct mail remains a highly effective strategy for customer acquisition, retargeting, and retention. Companies can use the Direct Mail Impact and Lifetime Value (LTV) Calculator to determine if direct mail is the right fit based on their product or service, revenue model, customer lifetime value, and customer acquisition costs.
Future Direct Marketing Channel Strategy
The ANA report highlights a growing interest in direct mail, with half of the respondents planning to increase its usage over the next 12 months. This marks the second-largest projected increase among direct marketing channels, with SMS/Text showing the greatest projected growth. Meanwhile, the usage of email, paid search, display, and social ads is expected to hold steady.
Patrick Carroll, Director of Strategy at SeQuel Response, commented on the findings, “For another year, direct mail has the highest ROI of any marketing channel for house lists. Even though it’s still underutilized, 50% of respondents said they will increase usage this year, solidifying its position as a powerful direct marketing channel and signaling its ability to support multi-channel acquisition strategies across media.”
Direct Mail Usage in DTC Campaigns
Direct mail marketing is a top three channel for direct-to-consumer (DTC) campaigns, used in 64% of such campaigns. It trails slightly behind social media advertising (78%) and email marketing (76%). In both B2C and B2B campaigns, email, social media, and digital display advertising are equally favored (85%), with direct mail coming in second (56%).
The primary purpose of direct mail campaigns is to drive direct sales (35%), followed by engaging prospects (18%), lead generation (15%), engaging customers (13%), and driving traffic to retail locations (7%).
Direct Mail Response Tracking
Online tracking methods, such as QR codes or Personalized URLs (PURLs), are the preferred way to track direct mail response rates, used by 82% of respondents. This is a significant increase from 67% in the 2022 survey. Other tracking methods include codes or coupons (64%), sales transactions linked to direct mail (54%), matchback (46%), and call center or telephone (39%). Less commonly used methods are list coding (21%), derived or calculated responses (18%), and other metrics (10%).
Direct Mail List Types
More than half of marketers (56%) use a mix of house and prospect lists for their direct mail campaigns. Prospect or potential customer lists, sometimes enhanced with third-party data, are used by 31% of marketers. However, the use of house or existing customer lists has declined by almost half since the 2022 survey, with only 13% of campaigns now relying on these lists.
Direct mail sent to house lists continues to yield the highest ROI at 161%, while the ROI for mail sent to prospect lists is 34%. The average campaign ROI across all channels surveyed is 35%.
Direct Mail Formats
When targeting house lists, the use of postcards has risen by 17% from the 2022 study, with 76% of marketers now favoring this format. Postcards are perceived as more informal and cost-effective, using less material and benefiting from postage discounts offered by the USPS for larger postcard sizes.
For prospect lists, letter-sized envelopes have become the top format choice (67%), with postcards following closely at 62%. The use of catalogs in prospecting campaigns has also seen a significant increase, doubling from 25% to 48% compared to last year’s survey.
Direct Mail Performance Metrics
Response rate remains the primary indicator of campaign success for 73% of marketers. The most common methods for tracking response rates include online tracking (82%), codes or coupons (64%), sales transactions linked to direct mail (54%), and matchback (46%).
Return on Investment (ROI) is the second most important metric, followed by Cost per Thousand (CPT) and Cost Per Response (CPR), which are equally favored as the third preferred metric. Approximately 20% of marketers use alternative metrics to measure campaign performance.
Conclusion
The 2023 ANA Response Rate Report highlights the continued dominance of direct mail in delivering high ROI for marketers, particularly when targeting house lists. As businesses look to optimize their marketing strategies, the integration of direct mail with other digital channels can offer a robust approach to customer acquisition and engagement. With its proven effectiveness and growing adoption, direct mail remains a critical component of successful direct marketing campaigns.
About Me: I’ve helped hundreds…literally hundreds of small business, medium size businesses and worked for enterprise in my life when their staff screws up. Today I maintain a book of clients privately running their I.T. & Digital Marketing initiatives with the aim of growth. I love working with small business and start-ups vs corporate/enterprise environments for personal reasons and have built a life that sustains that happily. Today, I can happily say I can cherry pick who I work with and I can tell you it’s not all about the money.
As someone who has worked with direct mail and printing companies all my life, I have always been biased and had a feeling it would gain in impact as everyone knee-jerked to deploying digital mediums only, losing sight of tactics that worked. I once sent direct mail to a single person using the “bulky mail” tactic and got him to return my call, providing a long-term customer to my client. I’ve witnessed its effectiveness firsthand!
The 2023 Association of National Advertisers (ANA) Response Rate Report reveals that direct mail has emerged as the top performer in return on investment (ROI) among various direct marketing channels. Published in February 2024, this comprehensive report highlights the benchmark performance and cost data for 2023 across direct mail, paid search, digital display, email, social media, and SMS.
Key Findings from the 2023 Response Rate Report
Direct Mail Return on Investment
According to the ANA report, direct mail achieved the highest ROI of 161% when sent to house lists, outperforming all other marketing media. Email to house lists follows with an ROI of 44%, while social media advertising rounds out the top three with a 21% ROI. This data underscores the effectiveness of direct mail in generating significant returns compared to other channels.
Most Used Direct Marketing Media
The report indicates that email marketing and social media advertising are the most widely used media types for direct marketing campaigns in 2023, with an 80% usage rate for each. Digital display advertising (67%), direct mail (52%), and paid search (51%) are also among the top five most used media. Each of these media types has seen an increase in usage compared to the 2022 study.
For many businesses, solo direct mail remains a highly effective strategy for customer acquisition, retargeting, and retention. Companies can use the Direct Mail Impact and Lifetime Value (LTV) Calculator to determine if direct mail is the right fit based on their product or service, revenue model, customer lifetime value, and customer acquisition costs.
Future Direct Marketing Channel Strategy
The ANA report highlights a growing interest in direct mail, with half of the respondents planning to increase its usage over the next 12 months. This marks the second-largest projected increase among direct marketing channels, with SMS/Text showing the greatest projected growth. Meanwhile, the usage of email, paid search, display, and social ads is expected to hold steady.
Patrick Carroll, Director of Strategy at SeQuel Response, commented on the findings, “For another year, direct mail has the highest ROI of any marketing channel for house lists. Even though it’s still underutilized, 50% of respondents said they will increase usage this year, solidifying its position as a powerful direct marketing channel and signaling its ability to support multi-channel acquisition strategies across media.”
Direct Mail Usage in DTC Campaigns
Direct mail marketing is a top three channel for direct-to-consumer (DTC) campaigns, used in 64% of such campaigns. It trails slightly behind social media advertising (78%) and email marketing (76%). In both B2C and B2B campaigns, email, social media, and digital display advertising are equally favored (85%), with direct mail coming in second (56%).
The primary purpose of direct mail campaigns is to drive direct sales (35%), followed by engaging prospects (18%), lead generation (15%), engaging customers (13%), and driving traffic to retail locations (7%).
Direct Mail Response Tracking
Online tracking methods, such as QR codes or Personalized URLs (PURLs), are the preferred way to track direct mail response rates, used by 82% of respondents. This is a significant increase from 67% in the 2022 survey. Other tracking methods include codes or coupons (64%), sales transactions linked to direct mail (54%), matchback (46%), and call center or telephone (39%). Less commonly used methods are list coding (21%), derived or calculated responses (18%), and other metrics (10%).
Direct Mail List Types
More than half of marketers (56%) use a mix of house and prospect lists for their direct mail campaigns. Prospect or potential customer lists, sometimes enhanced with third-party data, are used by 31% of marketers. However, the use of house or existing customer lists has declined by almost half since the 2022 survey, with only 13% of campaigns now relying on these lists.
Direct mail sent to house lists continues to yield the highest ROI at 161%, while the ROI for mail sent to prospect lists is 34%. The average campaign ROI across all channels surveyed is 35%.
Direct Mail Formats
When targeting house lists, the use of postcards has risen by 17% from the 2022 study, with 76% of marketers now favoring this format. Postcards are perceived as more informal and cost-effective, using less material and benefiting from postage discounts offered by the USPS for larger postcard sizes.
For prospect lists, letter-sized envelopes have become the top format choice (67%), with postcards following closely at 62%. The use of catalogs in prospecting campaigns has also seen a significant increase, doubling from 25% to 48% compared to last year’s survey.
Direct Mail Performance Metrics
Response rate remains the primary indicator of campaign success for 73% of marketers. The most common methods for tracking response rates include online tracking (82%), codes or coupons (64%), sales transactions linked to direct mail (54%), and matchback (46%).
Return on Investment (ROI) is the second most important metric, followed by Cost per Thousand (CPT) and Cost Per Response (CPR), which are equally favored as the third preferred metric. Approximately 20% of marketers use alternative metrics to measure campaign performance.
Conclusion
The 2023 ANA Response Rate Report highlights the continued dominance of direct mail in delivering high ROI for marketers, particularly when targeting house lists. As businesses look to optimize their marketing strategies, the integration of direct mail with other digital channels can offer a robust approach to customer acquisition and engagement. With its proven effectiveness and growing adoption, direct mail remains a critical component of successful direct marketing campaigns.
About Me: I’ve helped hundreds…literally hundreds of small business, medium size businesses and worked for enterprise in my life when their staff screws up. Today I maintain a book of clients privately running their I.T. & Digital Marketing initiatives with the aim of growth. I love working with small business and start-ups vs corporate/enterprise environments for personal reasons and have built a life that sustains that happily. Today, I can happily say I can cherry pick who I work with and I can tell you it’s not all about the money.
