A Case of Mass Mail Disected
I own a small rental home in a suburb of a large city. The economic demographics of the area are miserable with unemployment estimates ranging from 20% to 30%. The median income for a household is just above poverty at close to $15,000. Most of the homes are either small single family, manufactured homes or multiple tenant. The street picture shown here was taken just down the road from my rental and is depictive of the area.
Last week one of my tenants showed me a mass mail flyer she had received in her box. The flyer is beautifully printed on 8 1/2 by 11 cardstock, so the company paid extra to make a nice marketing brochure. There are lots of sharp pictures and easy to find calls to action.
There is only one problem. The flyer showcases middle class homes for sale with payments starting at $924 per month or close to 75% of the monthly income for the region, a debt to income ratio that no responsible bank will provide a loan for.
The company spent a lot of money having the flyers designed, printed and mailed. But their marketing efforts fell flat because they sent the flyers to a demographic area that could only hope to one day see a home this nice much less live in one. Now please don’t get me wrong. Multiple thousands of people have risen from poverty situations to become multi-millionaires in income. Also, I believe everyone deserves a chance. However, if I am a CEO looking at the bottom line of my company, mass mailing a flyer to an area that demographically could not purchase my product would not be at the top of my list for good marketing decisions.
What Could Have Been Done Differently?
If I were the marketing person of this company, I would have surveyed the geographic region looking for neighborhoods that are in the range of mid to upper lower income and higher. In other words, I would want an average income of a minimum $35,000 per year and up. Many mortgage companies will loan with a 50% debt ratio. Therefore, taking the monthly payment and adding in $250 for car loans or other debt, we come to a needed income of just under $30,000. I don’t want my sales people to spend a lot of time on people who are marginal and may or may not be approved for loans so I would increase the criteria to a minimum of $35,000 income to provide a buffer.
Living Arrangement Demographic
After finding the income demographic, next I would look for areas with higher than average rental properties. Selling a new home to an existing homeowner in a lower income field is much more difficult as the owner would need to sell their home first to remove the mortgage from their debt before they could be approved to buy my home. That process could take months and I would rather sell my homes quickly for return on investment purposes (ROI). So I am looking for people who could be transient.
Thus, my ideal marketing demographic is an area with incomes at absolute minimum of $35,000 per year and lots of rental homes or apartment complexes. Next I would pick the matching areas that are closest to my subdivision because people are more likely to make a short move than a move of many miles unless they are motivated to be closer to family or job which creates a significantly smaller demographic. Again, I want to sell my homes as quickly as possible. Time is money.
The next question is, does mass mailing even work? The answer is yes and no. If the company who sent out the home flyer looks at their statistics then they are probably going to say, “No,” but the reason is they did not send them to a properly targeted area. If I was head of their marketing and had sent flyers to my highly targeted demographic then my company would probably say, “Yes.”
How to Make Direct Mail Work
The first problem to overcome in mass mail marketing is determining where your target demographic lives. The U.S. Post Office has a program for small businesses that helps provide demographics of mailing routes and zip code areas. By using the program, the sender does not need to know specific names or addresses; a big money and time saver.
I have always recommended that any direct mail piece be a printed postcard instead of a letter in an envelope. Many, if not most, letters that look like an advertisement go into the trash without being opened. We’ve all thrown away mail without even opening the envelope. A postcard does not need to be opened to get its message across and leaves an instantaneous impression. Another reason to use postcards is cost. The postage cost of a small card is less than a first class envelope.
Be honest in your advertising. Many businesses believe that putting messages such as “URGENT” on the envelope will get more people to open them. They might be right, but if the offer is not actually urgent then you have misled your potential customers. If a customer can’t trust your marketing then how can they trust your product or service?
Old & New
Even though we are using an old-school medium, mesh the old and new by placing your website’s URL prominently. Include a specific landing page in order to track leads, but be sure the specific page is easy to type. You could use something like “yourdomain.com/enter” for a contest or, “yourdomain.com/MoreInfo.” It is easy to make the URL a call to action.
Mass Mail Remarketing
Sales people should be given the freedom to mail flyers and promotional materials to customers. A personalized follow-up to a non-purchaser will go a long ways toward bringing the customer back into the store, especially if it includes specific information about the product they were considering. Some businesses have even gone so far as to take a picture of the product and send it to the customer along with the product’s most compelling aspects. Think about it, having the person look again at the product they were drooling over in the store is like eye-candy! Be sure your contact information is prominent. Perhaps include a coupon for a percent off or a complimentary product if they bring the postcard or letter back when they return to purchase the product within so many days. (Always give a deadline.)
Not Dead Yet
Mass mailing is not dead. Mass mail is like most marketing, if done properly it will work and yield results. When cost per conversion is tracked as opposed to cost per customer targeted the benefits become more realistic. For instance, mass email may cost less per thousand potential customers reached, but when compared to cost per conversion it may actually cost more if you are using a sending service.
Contact Us Now
If you have questions about mail marketing, contact your Max Marketing Coach for a free consultation for new clients, or as part of your ongoing coaching for our existing clients.
Publish date: February 16, 2015
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