Direct Mail vs Digital Marketing: Clash of the Titans

“Find out what works, and do more of that.” ~ Steve De Shazer

As a direct mail marketer, it is almost impossible to avoid this topic. This is our second visit to the same topic. Second, yes, we just couldn’t resist it! Our research revealed a lot more about each of these marketing methods, direct mail versus digital marketing.

How do direct mail and digital marketing fare in numbers?

For 2015

• Response rate: Direct mail had a net response rate of 3.7% for house list against a 0.62% response rate of all the digital media channels combined.
• Cost-per-acquisition (CPA): Direct mail stands quite competitive at $19 per acquisition against CPA of $16 to $18 for mobile and social media, $21-$30 for paid search, $11-$15 for email, and $41-$50 for Internet display.
• Response rate: Direct mail had a response rate of 15-17%, same as that of social media channels.

For 2016

• Response rate: Direct mail had a record year since 2003, with response rates of 5.3% for house lists and 2.9% for prospects list. On the contrary, none of the digital channels cracked the 1% mark. Online display stayed aced digital channels at 0.9%, email at 0.6%, social media at 0.6%, and paid search at 0.5%.
• ROI: Email aced the list with 122% ROI, leaving behind social media (28%), direct mail (27%), paid search (25%), and online display (18%). For 2017
• Response rate: Direct mail continued its dominance with a response rate of 5.1% against a combined response rate of 2% for all the digital channels combined.
• Direct mail remains the third most used marketing channel.

These figures clearly put direct mail ahead of all the other digital marketing channels in terms of the overall response rate. However, direct mail didn’t do well in terms of ROI, and it comes with a high CPA rate.

What does Smart Money think of the future of marketing?

After a careful study of various reports, Smart Money thinks that the future of marketing lies in multichannel marketing. In fact, the annual reports of the Data and Marketing Association indicate a similar trend. Their data indicates that more than 44% of the participating marketers used at least three channels of marketing in 2015. These figures came out to be 52% and 70% for 2016 and 2017, respectively.

In our opinion, if you’re a marketer, embracing each of the marketing channels is critical to your success. It is best to use a combination of these marketing methods. One such example would be to use direct mail for a focused list, email for bulk mailings, and social media for combined lists.

Always remember what Charles Darwin said,

“The most important factor in survival is neither intelligence nor strength but adaptability.”

Data sources: We took the annual reports from the Data and Marketing Association’s bookstore.

Contributor: Prakash Pandey