Contrary to what you may have heard, direct mail is not dead.
Direct mail may be considered “traditional” media and is ripe for new ideas and innovation. But you will most certainly receive offers, coupons, postcards, brochures, and maybe even a packet in your mailbox this calendar year.
A recent study reports that 29.5% of banks and credit unions plan to increase direct mail spending in 2017 while 21.3% plan to reduce their spending on direct mail.
I’m not trying to convince your bank or credit union to invest in direct mail. But if it’s a tactic that fits your strategy, go for it! I’m a social media purist (most of the time). However, a well thought-out campaign can integrate direct mail and social media with measurable success for any bank or credit union.
So what am I trying to do? I want to weigh the pros and cons of direct mail and social media, specifically Facebook ads, so that you can make an informed choice.
How Direct Mail & Social Media Stack Up
- Personal and physical connection
- Response rates are on the rise (DMA: 5.3% in 2016 vs. 3.7% in 2015)
- Custom audience
- Inexpensive, by comparison
- Ability to make edits in real time and easy A/B testing
- Trackable ROI
- Custom audience
We like to get mail! According to Gallup, four in 10 Americans look forward to checking their mail. And DMA reports that 42% of recipients read or scan mail pieces. If you create a well-executed direct mail campaign with a trackable call-to-action, the ROI can be impressively high.
Facebook ads come with built-in data for ROI tracking. You get more bang for your buck (no postage costs here!), and they even allow for audience or message testing before spending a large campaign budget.
Oh, and when you make a copy mistake, Facebook ads allow you to edit in a matter of minutes. Make that same copy mistake on a printed direct mail piece, and you have to live with it (or undertake an expensive re-printing).
- Long lead time
- Tough to calculate ROI without a trackable call-to-action
- Barrier to entry is low
- Potential to waste money if managed poorly
Direct mail is not a quick and easy process. It typically involves design time, proofing and printing. All of which can be expensive on top of paying for postage. That doesn’t even take into account purchasing a prospect list!
By comparison, 100% of your Facebook ad spend is allocated directly to the ad. That is unless you hire a professional to run your ads, which can be more expensive but worth it. Just like you should hire a pro to create your print piece if you lack graphic design skills, so too a professional agency (like Move Digital) has the expertise and experience to meet your goals through ad placement.
What will $4,000 – $4,500 get you in one month with direct mail vs. Facebook ads?? Let’s look at two real Move Digital clients, based on numbers from March 2017.
- Direct mail piece that costs a maximum of $2.00 each to print and mail to 2,000 homes
- $3,000/month agency fee with a $1,500/month ad budget resulted in 10 targeted Facebook ads with custom audiences and a reach of 90,000 people
GIVE IT A TRY-
Depending on your industry and goals, direct mail might be the exact right tactic to achieve your bank or credit union’s goals.
It’s not that one is more effective than the other, but direct mail and social media ads are two different tools that be used to accomplish the same thing. Weigh the pros and cons and do your research.
The key is, and will always be, to start with your strategy first.