Direct mail dead? Not so! Here is my new business. Comments welcome!

[msabath]

<div class="bbWrapper">Hi Fastlaners!<br /> <br /> So here is the concept of my business I am beginning and I would like some feedback from the experienced people on this forum.<br /> <br /> Basically, it&#039;s direct mail. Everyone is so hyped up about the internet and all of the wonderful opportunities that it provides us. And rightfully so! But too often, the old tried and true methods are overlooked. Sometimes they just need a little twist to provide significantly more value. And that is a win win scenario.<br /> <br /> I will go over the three concepts and then discuss my implementation of the systems. <br /> <br /> <b>Targeted niche mailers:</b><br /> <br /> I have access to many many high quality mailing lists for very cheap that are updated frequently. The type of lists range from everyone in the US who has income over $100,000 who purchase stamps and coins for collecting to new movers by zip code to Ford Mustang owners sorted by year of purchase and year of the car.<br /> <br /> By analyzing the markets represented in these lists, I can contact noncompeting businesses that would like to target these niches. Then I print large glossy mailers with 3 advertisements to these lists. I have a great printing company that allows me to print, label, sort, and mail these mailers for a few pennies a piece. <br /> <b><br /> Joint Venture Mailings<br /> </b><br /> This is pretty similar to the previous type of mailing, but it is a crossbreed between that and the mailing to follow.<br /> <br /> Same postcard, still 3 ads. <br /> <br /> However, instead of targeting the masses, I would keep these very local. Find a market, say restaurants, that you want to target. Find two non competing businesses to pay for spots on the ad. These two ads pay for the mailing. On the third spot, I can use for my own offer. Say, a lead generation offer or one of my side businesses like SMS.<br /> <br /> It helps everyone! The two businesses get really cheap advertising and I get free exposure to a few thousand prospects for free.<br /> <br /> <b>The Money Card<br /> </b><br /> Here is the idea that makes the most money and has the highest potential in my mind. Make a 9x12 super glossy thick card. By taking advantage of Every Door Direct through the USPS, these can be sent for pennies a piece. Add in printing cost and it is still super cheap.<br /> <br /> Fill the card up with 12 - 14 ads using the front and back of the card. Charge $600 a mailing per ad on this card.<br /> <br /> The secret sauce I have added and what makes it worth the money for the advertiser is how I&#039;m targeting where these ads go. I will mail it to 12k-15k households. I take US Census data, real estate data, all public information that I can find, and a few paid databases. I overlay all of that information in my GIS system and find geographic hotspots that statistically have the highest rate of advertisement response.<br /> <br /> Then I align my EDDM routes to hit the most of these areas as possible. So instead of just mailing out ads to every house in the area, I mail it only to households that are wanting to use these ads.<br /> <br /> And I can do it for pennies per impression. <br /> <b><br /> <br /> My problems:<br /> </b><br /> My plan is to segment these lists into geographical areas and have salespeople start selling this. This is a barrier for me though. It works much better to be able to provide a physical sample of the mailer and make the sale face to face. But that means I have to hire local salespeople. I don&#039;t know if that will work well. The money is there to pay hefty commissions to salespeople, but how can I hire people remotely without ever meeting them? How would I know I could trust them with the reputation of the company?<br /> <br /> Can it be done without a physical presence? Is it something that can be sold over the phone and email? I&#039;m just not sure about that. I have done a few of these in my area and it works out well when the prospect can see the mailers. I haven&#039;t had much success with the phone and email, but I&#039;m not a very good salesperson.<br /> <br /> What do you think about this system?<br /> <br /> If I can hire salespeople to start hitting up areas around the country, it could be hands off for me. I have systems in place for printing and mailing. It just needs to be sold</div>

 

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[PatrickP]

<div class="bbWrapper">I only get my mail every couple days but I would estimate there are 40 - 50 pieces in there. I only look for bills which usually there are none as I pay on line.<br /> <br /> The other 39 - 49 pieces get thrown out without even looking what they are.<br /> <br /> Other people may or may not do the same thing.</div>

 

[msabath]

<div class="bbWrapper">You are absolutely correct!<br /> <br /> That&#039;s why I think this is different. First, it is an 11x14 high gloss thick card. Even if you don&#039;t pay much attention to it, you will see it. You will read one or two even if it is just on the way to the trash. Mailing 15k of these, even a 1 or 2% response rate turns into 200-300 paying customers. That is well worth $600 dollars to nearly any business. <br /> <br /> The mailings will also go to households that statistically use coupons and ads. So that will increase read and response rates.</div>

 

[AgonI]

<div class="bbWrapper">Bob ross&#039;s method from WF? Unless you are a good salesman, forget about it <img src="/community/imgs/emoticons/em-smile2.png" class="smilie" loading="lazy" alt=":)" title="Smile :)" data-shortname=":)" /> But as long as you have some sales experience(B2B) then you can make money with it. It&#039;s a lot of work though.<br /> <br /> edit: Sorry, just noticed you said you are going to hire salesmen.</div>

 

[PatrickP]

<div class="bbWrapper"><blockquote data-attributes="" data-quote="msabath" data-source="post: 241832" class="bbCodeBlock bbCodeBlock--expandable bbCodeBlock--quote js-expandWatch"> <div class="bbCodeBlock-title"> <a href="/community/goto/post?id=241832" class="bbCodeBlock-sourceJump" rel="nofollow" data-xf-click="attribution" data-content-selector="#post-241832">msabath said:</a> </div> <div class="bbCodeBlock-content"> <div class="bbCodeBlock-expandContent js-expandContent "> You are absolutely correct!<br /> <br /> That&#039;s why I think this is different. First, it is an 11x14 high gloss thick card. Even if you don&#039;t pay much attention to it, you will see it. You will read one or two even if it is just on the way to the trash. Mailing 15k of these, even a 1 or 2% response rate turns into 200-300 paying customers. That is well worth $600 dollars to nearly any business. <br /> <br /> The mailings will also go to households that statistically use coupons and ads. So that will increase read and response rates. </div> <div class="bbCodeBlock-expandLink js-expandLink"><a role="button" tabindex="0">Click to expand...</a></div> </div> </blockquote><br /> <br /> Ok you are flat out wrong in your assumption.<br /> <br /> No I and many like me will NOT read one word. YOU might and others might but you can not make assumptions like you are. That is the way people start businesses which fail.<br /> <br /> I throw out magazines without even looking to see the title of the magazine what hope does your 11 x 12 thick flyer have on people like me? Zero</div>

 

[AgonI]

<div class="bbWrapper">PatrickP, actually there are a lot of businesses who advertise using Direct Mail and see a huge ROI. There is tons of factors that will determine the success of a DM campaign, and it&#039;s definitely a good marketing strategy. <a href="http://www.postcardmania.com/" target="_blank" class="link link--external" rel="noopener">Direct Mail | Bulk Mail | Postcard Printing | Postcard Marketing | PostcardMania</a> There are tons of case studies listed on that site, list of businesses who have used it successfuly and other information. I&#039;ve actually spent a lot of time brainstorming this idea that the OP has posted, but it takes a lot of personal sales experience(or hiring salespeople) to make this work.</div>

 

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[PatrickP]

<div class="bbWrapper">AgonI I never said there were not lots of companies that advertised via Direct Mail. <br /> <br /> What he said wrong was about that even I would read a few lines of what he was sending, when the reality is I would not.<br /> <br /> AgonI, there are lots of companies who thrown money away on advertising which does not work every day.<br /> <br /> They have ZERO way to track their results so the keep falling for the crap that their PR/marketing company tells them to do.<br /> <br /> The link you posted is a horrible example.<br /> <br /> It is a company which makes its money by having businesses pay for direct mail I am fairly confident they would only post studies which support their getting more of your money right?<br /> <br /> <b>As for direct marketing Actually I do it.</b><br /> <br /> I send my direct mail a certain way but it is about the ONLY thing about business I will not say how I do it because I am know of no other company that does it the way I do it and I don&#039;t want any to start <img src="/community/imgs/emoticons/em-smile2.png" class="smilie" loading="lazy" alt=":)" title="Smile :)" data-shortname=":)" /> <br /> <br /> I also know EXACTLY the return I get on my mailings so I know what does and what does not work for my businesses.</div>

 

[wade1mil]

<div class="bbWrapper">With 15,000 mailings and a 1.5% response rate, there will be a total of 225 responses divided amongst the 14 advertisers. This means each advertiser will get on average 16 leads to try and convert to sales. If you charge $600 per ad, make and mail the ads for 40 cents each, pay your sales people 25% commission only, you would profit about $300 with no other expenses or taxes accounted for.<br /> <br /> My dad has done this for the past ten years for large corporations (they have two $3 million printers) and have lists that are far more targeted than the lists you describe above, and a great response rate for a post card to their list is around 2%. Another thing you have to think about is your sales force. If you had one sales guy that sold every ad and he/she made a 25% commission, he would make $2,100 pretax. Not very intriguing. Before I went down this road I would research it like a MF and know the exact numbers to see if it makes sense to everyone.</div>

 

[theBiz]

<div class="bbWrapper">Direct mail works, the more things go digital the more i want to use direct mail, it depends on your business. Its like the 99% who say PPC doesent work, seo doesent work etc. Its difficult to get it working but if you do, its money in the bank. I know someone who was getting an unbelievable response rate, slightly deceptive but they spent something like 40k a month at some point and time i believe. There are plenty of companies making millions of dollars per year mostly coming from direct mail just so everyone here knows.<br /> <br /> Listen to Patrick... i do the same BUT im assuming i wouldent do it to his mailer in which Patrick says works for his company, he must have &quot;figured&quot; out his niche mailers.<br /> <br /> As far as tracking.. potential customers MUST enter their &quot;exclusive&quot; code in order to receive whatever you are giving them for free in the DM offer....(now you know what state and city they are in based off of code)<br /> <br /> That thing you are giving them for free.. that offer expires in 9 days from the time the mailers went out (urgency)<br /> <br /> <br /> I have just seen it work so well but also terrible. The list is important but i think whatever you are offering is important. Some companies pay mailing houses to hand address the letters....if it works it works. <br /> <br /> The times ive seen it work well is either your sending a free product or you make it look official so they are almost scared into reading it, put a gold seal on the letter, etc (government letter replicas).</div>

 

[AgonI]

<div class="bbWrapper">Hey guys, don&#039;t get me wrong. I&#039;ve never done DM so I don&#039;t really know how it works out in terms of ROI, etc. But what I do know is that it doesn&#039;t work for every niche. One good example of where it would work is a company that makes 3,000-5,000$ per sale(audiologists). So, if they were to send a SOLO piece of flyer(i.e. they will be featured in the flyer all by themselves, with both sides having content) to 10,000 residents older than 60, with income of 60,000$/year or more, do you think they won&#039;t be able to get at least 10 leads? If it cost them 7,000-10,000$ to do the campaign, and they sell 10 of those small little things that help with hearing, that converts to 30,000$-50,000$ in sales. Scale it to 100,000 flyers and there you have it <img src="/community/imgs/emoticons/em-smile2.png" class="smilie" loading="lazy" alt=":)" title="Smile :)" data-shortname=":)" /><br /> <br /> edit: that would be the minimum possible conversion rate(0,001%). You would expect at least 1% leads from an ultra targeted audience. That&#039;s 100 people out of 10,000 mailers. Let&#039;s say you convert only 50, do the math how much is the profit! <br /> There are many things to be considered though. How good the offer is, how well is the flyer designed, the timing(season when the mailer is sent out), THE LIST, etc.<br /> <br /> Oh, and PostcardMania is a multi million dollar company. I am not saying they will tell you no we can&#039;t create a campaign for you because your niche wouldn&#039;t work if you were to ask for a quote, but I&#039;m sure they&#039;ll do their best to help you out. But of course, if you don&#039;t understand how it really works, then you shouldn&#039;t rely on their knowledge alone, unless you want to risk a lot of money w/o having any idea what&#039;s going on(as a business owner).<br /> Sorry for the rambling, I haven&#039;t slept for almost 34 hours <img src="/community/imgs/emoticons/em-smile2.png" class="smilie" loading="lazy" alt=":)" title="Smile :)" data-shortname=":)" /></div>

 

[theBiz]

<div class="bbWrapper">Dont do it right now, its an art i can almost promise if you dont have experience your just killing trees both your dollars and the paper needed to send it out.<br /> <br /> I just googled <br /> <br /> direct mail case studied (dont read the ones on sites that actually provide the service)<br /> <br /> direct mail expected response rate<br /> <br /> <br /> I found some good articles but i really believe its expensive and usually rightfully so, you can get 100 crappy internet leads everyday that dont convert or 2 DM leads that you sell them each a 5k product so its the business.</div>

 

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[AgonI]

<div class="bbWrapper">wade1mil, you can&#039;t really send out 15,000 mailers with multiple companies in it. Assuming they are all doing business in a different niche(it wouldn&#039;t make sense that they all be competitors and advertise together) you would be using the EDDM service from USPS. You would pay around 20-30 cents for each mailer(size 9x12) where you can include up to 16 advertisers on both sides. <br /> 15,000 x 30 cents = 4500$<br /> 16 advertisers * 600$ = 9600 - 25%(sales people) = 7200<br /> You are left with about 2000-3000$ profit for ONE mailer only. Usually, if you get them good results, advertisers/businesses will keep advertising there every month (not all of them but you can always replace the ones that stop with new ones), so it&#039;s recurring $$$. <br /> Now, there is no limit in how many areas you can get this mailer rolling, it all depends whether you can find enough sales people to add in advertisers constantly. <br /> You are basically trying to create a different type of ValPak or MoneyMailer</div>

 

[wade1mil]

<div class="bbWrapper"><blockquote data-attributes="" data-quote="theBiz" data-source="post: 241848" class="bbCodeBlock bbCodeBlock--expandable bbCodeBlock--quote js-expandWatch"> <div class="bbCodeBlock-title"> <a href="/community/goto/post?id=241848" class="bbCodeBlock-sourceJump" rel="nofollow" data-xf-click="attribution" data-content-selector="#post-241848">theBiz said:</a> </div> <div class="bbCodeBlock-content"> <div class="bbCodeBlock-expandContent js-expandContent "> As far as tracking.. potential customers MUST enter their &quot;exclusive&quot; code in order to receive whatever you are giving them for free in the DM offer....(now you know what state and city they are in based off of code) </div> <div class="bbCodeBlock-expandLink js-expandLink"><a role="button" tabindex="0">Click to expand...</a></div> </div> </blockquote><br /> You could also use a unique phone number per city, state, etc. I used this method for auto insurance to test different ads and it worked brilliantly. You then can go back to the newspaper or phone book and show them hard figures of how many leads you got from ads, and renegotiate based on what makes sense for your business.</div>

 

[theBiz]

<div class="bbWrapper">I know those local coupon books work and know of a local company with around 10 employees netting what i would say has to be 750k-1m a year.</div>

 

[theBiz]

<div class="bbWrapper">Wade do you have experience with lists and which ones are crap, what to look for etc? Im interested in learning more about lists.</div>

 

[wade1mil]

<div class="bbWrapper"><blockquote data-attributes="" data-quote="theBiz" data-source="post: 241857" class="bbCodeBlock bbCodeBlock--expandable bbCodeBlock--quote js-expandWatch"> <div class="bbCodeBlock-title"> <a href="/community/goto/post?id=241857" class="bbCodeBlock-sourceJump" rel="nofollow" data-xf-click="attribution" data-content-selector="#post-241857">theBiz said:</a> </div> <div class="bbCodeBlock-content"> <div class="bbCodeBlock-expandContent js-expandContent "> Wade do you have experience with lists and which ones are crap, what to look for etc? I&#039;m interested in learning more about lists. </div> <div class="bbCodeBlock-expandLink js-expandLink"><a role="button" tabindex="0">Click to expand...</a></div> </div> </blockquote><br /> I have general knowledge of lists, but I think each mailing will have variations based on what you are selling (product or service), price point, target market, offer, etc. Maybe we can start a thread instead of hijacking this one and everyone else can provide some input based on their experience. What do you think?</div>

 

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[theBiz]

<div class="bbWrapper">Sure I understand the list is very important so i would like to know of good list sources and where to research/ buy</div>

 

[JAJT]

<div class="bbWrapper">I&#039;ve heard (no actual experience) that direct-mail works exceptionally well for local storage places. <br /> <br /> I would have to imagine this would work similarly well to any neighborhood-specific businesses as long as it filled a need.</div>

 

[DeletedUser2]

<div class="bbWrapper">we use nextmark.com for most of our list buys.<br /> <br /> also look up luke Jaten and his post card profits. a very good course. simple, direct and consistent.<br /> <br /> low startup costs, and can be a killer ROI if done right.<br /> <br /> <br /> <br /> Z</div>

 

[theBiz]

<div class="bbWrapper">Zend coming through once again.</div>

 

[Kak]

<div class="bbWrapper"><blockquote data-attributes="" data-quote="msabath" data-source="post: 241832" class="bbCodeBlock bbCodeBlock--expandable bbCodeBlock--quote js-expandWatch"> <div class="bbCodeBlock-title"> <a href="/community/goto/post?id=241832" class="bbCodeBlock-sourceJump" rel="nofollow" data-xf-click="attribution" data-content-selector="#post-241832">msabath said:</a> </div> <div class="bbCodeBlock-content"> <div class="bbCodeBlock-expandContent js-expandContent "> You are absolutely correct!<br /> <br /> That&#039;s why I think this is different. First, it is an 11x14 high gloss thick card. Even if you don&#039;t pay much attention to it, you will see it. You will read one or two even if it is just on the way to the trash. Mailing 15k of these, even a 1 or 2% response rate turns into 200-300 paying customers. That is well worth $600 dollars to nearly any business. <br /> <br /> The mailings will also go to households that statistically use coupons and ads. So that will increase read and response rates. </div> <div class="bbCodeBlock-expandLink js-expandLink"><a role="button" tabindex="0">Click to expand...</a></div> </div> </blockquote><br /> I think a postcard card having a 1-2% close rate, not responses, responses just waste more of your money, is not being conservative enough. I would not do this unless 1/1000 close made financial sense.<br /> <br /> It may be almost as cheap with a better response to scale down locally and hire high-school kids to put these on peoples doorsteps. 5.50/hour*60/hour= 330 out for 5.50 and no postage paid. <br /> <br /> I am thinking that the card&#039;s independence from the mailbox will help a lot!</div>

 

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[deepestblue]

<div class="bbWrapper">If direct mail didn&#039;t work, no one would ever receive a direct mail piece in the mail. Same for any other form of advertising. Every method works, but it has to be &#039;worked&#039; to work.</div>

 

[theBiz]

<div class="bbWrapper"><blockquote data-attributes="" data-quote="" data-source="" class="bbCodeBlock bbCodeBlock--expandable bbCodeBlock--quote js-expandWatch"> <div class="bbCodeBlock-content"> <div class="bbCodeBlock-expandContent js-expandContent "> I think a postcard card having a 1-2% close rate, not responses, responses just waste more of your money, is not being conservative enough. I would not do this unless 1/1000 close made financial sense. </div> <div class="bbCodeBlock-expandLink js-expandLink"><a role="button" tabindex="0">Click to expand...</a></div> </div> </blockquote><br /> 1000k leads at 1% = 10 leads. if you close 1 out those 10 you will get your 1/1000 close, it sounds repeated but basically if i gave you 10 leads would you close one of them? Id say most should be able to. It also depends on your business, some businesses offer multiple services so if you dont get them for one thing you can get them somewhere else they werent expecting it.</div>