Warm mailings 'get ten times the response of cold mail'

The benefits of using direct mail to boost levels of customer loyalty and engagement rather have been revealed at last, with new figures showing that the average warm mailing gets ten times the response one which is received out of the blue – but both beat digital campaigns hands down.

That is according to Jicmail’s inaugural Response Rate Tracker research, which for the first time has enabled the industry body to assess how responsive consumers are to acquisition compared to retention based marketing strategies with mail.

Response data derived from over 1,000 campaigns has revealed an average warm mailing response rate benchmark of 10.9% and a cold mailing benchmark of 1%.

In a climate in which efforts to boost levels of customer loyalty and engagement is taking on increased significance in the face of a challenging economic environment, understanding the response of known customers to advertising mail is all the more important.

The 10.9% response rate reported for warm direct mail highlights the value of speaking to current customers in the mail channel, when the ability to target using third party cookies is waning in an era of heightened privacy compliance.

However, practitioners should be wary of simply regarding warm mail as a more effective channel than cold mail. No brand grows without acquiring new customers, and understanding the effectiveness of the mail channel in driving acquisitions is critical to campaign planning efforts, the organisation insists. A 1% response rate of cold mail compares favourably to that seen by many other channels. A blend of warm and cold is therefore critical to success.

Based on the results of 1,017 anonymised campaigns provided by six key industry players (Join The Dots, Epsilon Abacus, Ginger Black Analytics, Sagacity, The Letterbox Consultancy and DBS Data) Jicmail’s first release of its Response Rate Tracker is billed as a pilot study.

This proof of concept study is designed to galvanise interest from the industry, expanding the pool of submissions and increasing the representation of benchmarks across industry sectors and mail types.

The Response Rate Tracker also reports on the average ROI of warm and cold direct mail, revealing results of 13.5 and 4.4 respectively. Average order value and cost per acquisition benchmarks have also been made available across four different industry sectors – retail, finance and insurance, medical and charity. Consisting of 83% retail and online retail campaigns, the database is currently skewed towards this sector, but future releases should look to redress this balance.

By providing campaign-centric response rate benchmarks, Jicmail has been able to supplement the output of its panel-centric metrics, in which a sample of 1,000 households a month self-report their interactions with, and response to, mail.

An average Response Rate Tracker figure of 5.1% across warm and cold mail combined, is closely aligned to the 5.6% response rate reported by the Jicmail panel, providing a powerful validation exercise for both independent data-sets.

The Response Rate Tracker is designed to assist planners and mail practitioners in setting targets and KPIs for mail campaigns. The benchmarks themselves are a starting point for target setting which should then be iterated upon using a unique set of brand, market and consumer factors that acknowledge the nuance of individual campaigns with different objectives.

Jicmail engagement director Mark Cross said: “These new response metrics are the start of what will become a growing pool of essential benchmarks and reference points for all campaign planners. They starkly exceed conventional digital response metrics and add a valuable layer to existing Jicmail data, together creating new discussions on how performance can be improved through the inclusion of mail in the omnichannel mix.”