Direct Mail in the Marketing Mix & Critical Success Factors

7/29/2019 Direct Mail in the Marketing Mix & Critical Success Factors

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Direct Mails Place in the Media Mix &

Critical Success FactorsWarren Paull

01.07.11


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Direct Mail competes in the decision market within the

advertising sector.

This can be described as including all personalised marketingcommunications, where personalisation is defined by the abilityto target (and in turn customise) via (but not limited to) non-modelled data (namely behavioural and/or consumer-

volunteered data), Its is this data which defines the market.

This is a growing market and although the channel suffers fromweaknesses in some areas, it has a unique role to play inpersuading the consumer.

This unique role is derived from its ability to simultaneouslyleverage the rational and emotional decision drivers in therecipient, which in turns makes for an efficient persuasionmechanism.

Summary


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The Market


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Business

Communications

Cost (Transactional) Investment (Marketing Communications)

Need:

Primarily Awareness

Need:

Primarily Decision

Press

Inserts

Television

Radio

Outdoor

Door Drop

Cinema

Experiential

In-Game

Internet Search

Direct Mail

Telemarketing

SMS/MMS

Mobile Apps

Field Marketing

Digital Publishing

Email

Social Media

Internet Display


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Business

Communications

Cost (Transactional) Investment (Marketing Communications)

Need:

Primarily Awareness

Need:

Primarily Decision

Press

Inserts

Television

Radio

Outdoor

Door Drop

Cinema

Experiential

In-Game

Internet Search

Direct Mail

Telemarketing

SMS/MMS

Mobile Apps

Field Marketing

Digital Publishing

Email

Social Media

Internet Display


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Critical Success Factors


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The Detail


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In defining the market for direct mail, Postcomm first segments the business communications market, isolating the advertising sector[1].

I agree; in seeking to understand direct Mails place in the media mix, we should first isolate the business communications market.

We should then divide this into cost and investment; where cost is transactional communications and investment is marketingcommunications. I have presumed that it is these marketing communications which Postcomm has termed advertising.

Postcomm then segments advertising into brand and direct response activity[2]. It is my view that this is an unhelpful definition,based on somewhat outdated notions of brand and direct channels, which were developed when the advertising sector was very

different from today (i.e., there has since been proliferation/fragmentation of media, along with technological developments whichblur the aforementioned notions of brand and direct, leading to the convergence of tactics).

We should instead (and always) attempt to segment the market on the basis of customer need. I submit that the advertising market

can in fact be segmented on the basis of whether the advertisers objective/metric is primarily awareness (i.e., know me, like me -includes attitudinal objectives, as one cannot be aware of something without also feeling something about it (even if this is

indifference)) or persuasion ( i.e., persuading the consumer to make a decision to perform an action, or to not perform an action

(e.g., loyalty do not buy someone elses product)). Indeed, my view is supported by Postcomm later in their report, where they talk

of the convergence of brand and response [3][4].

Postcomm then characterise the market for direct mail as being defined by the ability to contact a named individual (with mediacapable of this, acting as potential competitors to direct mail)[5]. My view is that the only useful way to segment a market is based

upon customer need. I do not accept that the fundamental customer need is to contact a named individual. I contend that this is, in

fact, a mere by-product of the fundamental customer need that is being pursued.

The customer need is to induce a decision

The mechanism employed to achieve this is persuasion, and persuasion is of course best achieved via customising the

communication/persuasion as much as possible to its recipient (which is in turn fed by targeting).

An individuals name may or may not be deemed an important part of this personalisation but, in any case, is only ever one element

the fundamental driver is customising the persuasion to the individual in order to most efficiently induce a decision.

[1] The building blocks for a sustainable postal service, Analysis of Markets (March 2011) 2.63[2] Ibid. 2.64[3] Ibid. 2.81[4] This analysis is further supported by Regulatory and economic challenges in the postal and delivery sector By Michael A. Crew, Paul R. Kleindorfer Chapter 17[5] Ibid. 2.115


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Perhaps the reason for Postcomms fixation on the individuals name is because this was, in the past, primarily/the only way in whichto customise a marketing communication to a targeted individual. This may have led Postcomm to overlook the fundamental customer

need that was driving this; concentrating instead on what was previously the only visible evidence of the need.

The need is decision which is achieved via customisation/personalisation the consumers name may or may not be part of this

customisation/persuasion.

Therefore, when we look at all of the channels available in advertising and map their attributes in relation to the advertisers need,

we see that there is, in fact, only one unique capability common which separates some channels from others. Only one key attribute

which allows us to group channels on the basis of whether they possess this attribute or notThis is the ability to target via non-

modelled data.

To clarify; what defines the market, is the ability to target using an individuals behavioural data and/or the individuals consumer-

volunteered data (modelled data may also be employed of course in addition to these elements).

Of course, there may well be numerous examples of campaigns that have, for example, employed only modelled data for a directmail campaign. However, there are always examples of bad practice (e.g., this is akin to one or two factories that might have carpet

put down on the factory floor instead of hard-wearing industrial flooring; theyre just pursuing the fulfilment of their need/objective

badlyeither because of lack of knowledge or lack of capabilityit is not an accurate reflection of the need itself ).

When we examine the customer needto induce decisionand in turn the elements which feed this (customisation/personalisation

fed by targeting) and then in turn the common characteristics of channels offering this to customers; we then see the ability to target

using non-modelled data defines the market for decision.

Therefore, it is my view that direct mail operates within what we shall term the decision market, competing against other

personalised marketing communications channels, where personalised is defined as the ability to target the consumer via

non-modelled data.


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Postcomm goes on to list what they see direct mails competitors as being (in order of closest substitute), based on the premise thatthe market is defined by the ability to contact a named individual [1]:Direct MailInternetEmailTelemarketingSMSDoor Drop

However, following my view that the market is in fact defined by the ability to target via non-modelled data, I conclude directmails competitors to be:Paid SearchDirect MailEmailTelemarketing

SMS/MMS

Postcomm uses the following to score the substitutability of other channels[2]:TangibleVisualPersonalTargetedEase of response via channel

I however, based on the premise that decision is the key objective and that this is best achieved by personalisation, which is in turn

fed by behavioural and consumer-disclosed data, believe the following are more appropriate:TargetingComplex messaging (degree of persuasion possible)InteractivityMeasurability

[1] The building blocks for a sustainable postal service, Analysis of Markets (March 2011) 2.117[2] Ibid.[3] The building blocks for a sustainable postal service, Analysis of Markets (March 2011) 2.294

Field marketingSocial NetworksInternet DisplayDigital Publishing

Mobile applications


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Postcomm then concludes that direct mails key differentiators are therefore[3];

Physical delivery

Targeting of named individuals

I have to disagree with Postcomm strongly on this point. It is this writers view that physical delivery is not a customer need per se,

therefore is not an acceptable characteristic to use in differentiating direct mail from other channels (or products) available toconsumers in the market. Additionally, and as previously set out, the targeting of named individuals is not a customer need either,

so is also an invalid characteristic to use for this purpose, in my opinion.

However, I do conclude that direct mail does, of course, have key differentiating factors as compared to other decision channels

Based on my analysis, the differentiating characteristic of direct mail is its ability to combine complex messaging with emotionalstimulation. Or to put it another way; it leverages both the rational and the emotional decision drivers.

To explain, in common with many competitor channels, direct mail is very capable of complex messaging (as supported byPostcomms report). Also, like some competitor channels, it has the ability to connect with the customer on an emotional level (via its

tangibility/physical delivery it is able to communicate with the consumer via that most emotional of the human sensestouch, smelland even taste, if so desired), in much the same way as many traditionally perceived brand (awareness) channels do. However,

by combining complex messaging with the emotional, or the non-rational element of the decision process, direct mail offers a very

powerful decision mechanism.

It achieves rational leverage via its capability for long-form copywriting, images and permanent nature of its physicality (i.e., it

can be retained by the consumer for consideration, as opposed to the transient nature of many other media). It achieves emotionalleverage by virtue of the consumers channel associations (the consumers emotional connection with the physical mailbox, which

persists despite (or perhaps because of) a switch to digital communication) and its bandwidth (i.e., in addition to the common

capacity to communicate visual and audible information, it is also capable of communicating tactile, aromatic and taste

information).


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Conclusion

The research and analysis summarised in the document leads this writer to believe direct mail competes in the decision market,

which sits within the advertising sector.

This can be described as including all personalised marketing communications, where personalisation is defined by the abi lity

to target (and in turn customise) via (but not limited to) non-modelled data (namely behavioural and/or consumer-discloseddata).

This is a growing market and although direct mail suffers from weaknesses in some areas, it has a unique role to play inpersuading the consumer on behalf of marketers.

This unique role is derived from its ability to simultaneously leverage the rational and emotional decision drivers in therecipient, which in turns makes for an efficient persuasion mechanism.

For direct mail (and other channels within the market for that matter) to be competitive against the alternatives in themarketing mix, it is vital that product development is undertaken in the industry, which addresses the critical success factors

(product benefits) outlined in this document; making the product stronger in these areas.

It is this writer's view that the decline of direct mail as part of the marketing mix, is in no small part due to the fact that the

digital channels which have emerged in recent years arefar from being different from direct mailin fact, very similar

indeed. This is to say that they use the same mechanisms to achieve the same broad objectives as that which direct mail is/wasused for. The fundamental difference however. is that they are far stronger in the critical success factors outlined herein. In

particular, they are much stronger in many of those critical success factors which determine the efficiency of these types ofcommunications (notwithstanding other CSFs which have a big impact on channel choice, such product features which play alarge role (cost/the risk of investment, etc)).

If the direct mail industry is able to develop products which address the aforementioned (as well as working on pricing modelsetc..) then there is no reason, in my view, why the channel cannot once again shine. Its capacity for complex persuasion,

customisation and, most of all, connecting with the consumer via all human senses, provides powerful building blocks for a

marketing channel. The latter attribute is indeed one which, I suspect, many of the newer channels would very much like to

possess, given the option.

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Direct Mail in the Marketing Mix & Critical Success Factors

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