The term Direct Marketing refers to sending communications to specific individuals, traditionally via postal mail, but more in the last decade via email. The objective is to reach new customers and ultimately, to generate new revenue. The response rate on direct marketing is extremely low when the list is a “cold” list, i.e., prospects who haven’t had contact with you before. by extremely low, consider that a 1% response is good for a cold list, and then of the responders only a small percentage will convert to actual sales. That means that a direct postal mailing can be an expensive proposition. So you can see why email marketing became so popular.
Over the years direct marketers have proven again and again that including an “offer” — a gift or incentive — for responders ups the response rate noticeably. You might suspect that there would simply be more people kicking tires but no more buyers. But, again, there is ample proof that an offer will ultimately bring out more buyers.
So what kind of offer should you incluce in your next direct marketing campaign? Erin Jacobs of Vertical Response advises that, “Before sending out a marketing campaign consider ‘Is there something in this email for the recipients to LEARN, GAIN, or ENJOY?’” Let those words be your cue to what kind of offer will be effective with the people you are trying to reach.
The best response rate I have seen in my career was when I was with a telecom company that used a pocket knife as the offer on a campaign. The response there was a whopping 19%! That meant we had a significantly larger number of names on our contact list. And as Jacobs points out, “If they respond once and find value in your message they are likely to pass it on and everyone wins.”
[Full disclosure: Vertical Response is the firm my consulting group uses to send out our monthly e-newsletter.]