How much does Direct Mail cost?

Oct 30, 2023

You’re reviewing your marketing budget and are considering adding direct mail to your strategy. But before you dive in, you want to know how much direct mail actually costs.

The short answer is it depends. The cost of a direct mail campaign can vary greatly depending on several factors, such as the type / format of mailing, the size of the mailing list and the type of paper & printing required.

Factors Influencing the Cost of Direct Mail

Direct mail remains a powerful and trusted communication tool, with its cost often determined by various factors, including the acquisition of data, the contents of the mailer, and postage fees. Typically, the cost can range from £500 to £1000 per 1000 mailers, equating to about 50p-£1 per piece. Postage, as expected, often forms the largest chunk of the cost, usually around £300–£600 per 1000, or 30–60p each, depending on weight, volume, and destination.

However, when considering the costs, it’s important not to lose sight of the purpose – i.e., to maximise the return on investment (ROI). While seemingly ‘cheaper’ mailing costs may seem attractive, they often deliver the worst ROI, leading to what one might term the “highest costs”, due to wasted budget & missed opportunity. In essence, the quality of the data (targeting new business or existing customers), the creativity of the content, and the paper & print quality elevate the chance of securing a robust ROI!

Adopting the Right Strategy for Cost-Effective Direct Mail

From our decades of experience, usually the most cost-effective direct mail strategy targets existing or lapsed customers first, rather than purchasing data for mailing to unfamiliar prospects. This approach helps maximise yield and reduces the risk of “lost opportunity” cost, the cost associated with losing an existing customer to competition. Mailing efforts should be focused on retaining, building, and extending the lifetime value of existing customers, selling more products & services, and selling to them more frequently, therefore maximising ROI. Direct mail can play a key part in this, but ‘cheap’ rarely means best.

So, while the costs per 1,000 pieces of direct mail may vary based on several factors, the best ROI is rooted in enhancing the lifetime value of customers. Hence, the question is not so much about the explicit cost of direct mail but rather, “What is the cost of not using direct mail to communicate with our customers, especially if our competitors are?” In other words, can your business afford to not use mail, to help you keep closer to your customers?

Additional Benefits of Direct Mail

Beyond just cost considerations, direct mail campaigns provide a host of benefits that can enhance your overall marketing strategy. In an era dominated by digital communication, the physical & tangible nature of direct mail creates a unique sense of authenticity and trust among recipients. Moreover, direct mail often enjoys higher & better-quality response rates than its digital counterparts and can be personalised for each recipient, providing a tailored customer experience that helps to build loyalty. Teaming up with experienced direct mail companies like bakergoodchild can ensure you tap into these benefits, while maintaining cost efficiency.

In summary, there is no one definitive answer to the question of how much direct mail costs. As with any marketing strategy, it’s crucial to consider factors such as ROI, targeting, and customer lifetime value. By doing so, businesses can make informed decisions about using direct mail to communicate with their customers and usually see a significant return on investment, over time.

So before dismissing direct mail as an expensive option, take a moment to consider its potential benefits and why it remains such a popular communication tool for businesses worldwide. Even the biggest brands in the world still invest in direct mail!

In the end, it’s not just about the cost of direct mail, but rather how much the investment could bring in for your business. If you need help with your next direct mail campaign, don’t hesitate to reach out to bakergoodchild!

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