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Ancient Marketing Technique Yields 4,967% Return on Investment (True Story!)

letter mailDespite our obsessions with smart phones, social media, and all things digital, one of the oldest forms of commercial marketing can still produce huge dividends. Can you guess what it is?

Paper.

Many of us have long since given up on using snail mail to get leads. Plenty of people, in fact, don’t even see a need for direct mail anymore – especially not for marketing.
But there’s that kid in all of us who still hopes that one day you’ll check the mail and inside will be a personalized letter, addressed just to you, with some exciting gift or message inside. Something other than flyers and bills. Right?

I know I do. So when Write Ahead was looking for a way to reach out to a very important group of potential customers, snail mail just seemed like the way to go. What better way to get someone to read our sales letter, than to have it delivered directly to them in hard copy? It’s almost like getting a present.

We launched a direct mail marketing campaign last January to reach out to a very specific type of client. The direct cost of the campaign was $450. The cost of our time to look up all the names and addresses – about $300.

The return? $38,000 – and counting.

If you haven’t done the math, that’s a 4967% return on investment. Not bad!

Now before you run out for a box of envelopes and a roll of stamps, note that I said “a very specific type of client”. Direct mail is less likely to generate strong returns if you blast it out to thousands of people who may or may not fit your ideal customer profile. It’s like any form of marketing, really – shooting in the dark produces more misses than hits. So if you’re planning any kind of direct mail marketing campaign, take the time to research the names of the people you want to reach out to, and make sure they fit your ideal customer profile.

Now, you might be thinking that direct mail isn’t a good marketing tool for your type of business. You’ll especially think that if you’re running an online business. So I’m going to put that myth to rest right now.

A Web Marketing Company’s Outside-the-Box Direct Mail Campaign

I’ll spare the specific details, because you can read all about Ugly Mug Marketing’s totally wacky, unique, and extremely effective direct mail campaign right on this very blog.  (Spoiler alert: it involves life size cutouts of Justin Bieber. No lie.)

At a glance, here’s what they did:

Step 1: They asked – and took time to answer – a key question most people don’t ask when they’re planning a marketing campaign. The question was “What are our prospects currently thinking and talking about?”

Step 2: They assessed those answers, and decided to roll with the most outlandish one. The most fascinating one. The one that would make most people think it was too ridiculous to work. (This is where Justin Bieber comes in – they knew their target market would get it).

Step 3: They narrowed down their prospect list. This ensured that they reached the customers they most wanted to work with. For Ugly Mug, that was just 10 people (who says you need a huge list to make money?). For us at Write Ahead, it was 180 people.

Step 4: They included motivators. Ugly Mug’s campaign included a discount offer. They also only accepted three new clients, even though four responded.
This one sales letter generated $26,495 in revenue.

When we ran our campaign, we ran a discount offer with an expiry date. These tactics encourage the target market to act fast. But they’ve stayed with us, even though the discount expired long ago.

Fringe Benefits

You know what else worked well for Ugly Mug? Writing about their direct mail campaign on the Mirasee blog. Because that’s how I learned about Wayne and his team, and that’s what led me to hire them to completely redesign Write Ahead’s web site. Even though I live in a different country 4,200 kilometres away and I’ve never seen any of them in person.

See? Direct mail works. Even indirectly. (WHOA)

How to Make Direct Mail Marketing Part of Your Business Plan

A business plan for any company (whether new or existing) ought to contain a clear description of your business’s ideal customer. (If you haven’t got one – use Mirasee’s customer profile template to get going!) Every other part of your plan stems from that description. So assuming you have that part well defined, the next step is to think about how your audience might respond to direct mail. Would they prefer formally addressed white envelopes, or life-size Justin Bieber cutouts? Something three dimensional? Something that follows up with a phone call? There are lots of ways to do it.

Make sure, of course, that the way you send your message also fits what you’re trying to say! A life-size cutout may get attention, but it needs to be on topic! If you find it difficult to determine what type of mail to send – then go with what is most appropriate to what you’re truing to say. 😉 A beautiful envelope and stationary for an invitation to a seminar, perhaps, or a thick card with a recipe and invitation to buy or download your cookbook.

Once you’ve identified what it is your ideal customers would like to receive, then it’s up to you to determine how many of them should receive it. How many customers would you like to get from your campaign? Consider both your target revenue and the capacity of your business. Ugly Mug wanted three new clients at $7,000 each. Write Ahead wanted ten new clients at $2,500 each. Both of us surpassed our revenue goals.

One interesting stat to note is that their conversion rate was about 30%, and ours was about 9%. We also sent our sales letter out to far more prospects, so it’s not at all surprising that our conversion rate was lower – our pool was larger and less targeted, and that was on purpose, because we were still feeling out that group of prospects in order to narrow them down even more later on.

Two Completely Different Campaigns… Two Completely Different Lists… The Same Remarkable Results

In the digital age, old fashioned ink on paper can still produce some awesome results. If you follow the steps above you should be able to create a direct mail campaign that does really well. And if you create a campaign that doesn’t produce the result you hoped, don’t worry about it. The lessons you’ll learn during the process will help you hone your skills for your next campaign.

Again, the best way to reduce your risk of an unsuccessful campaign is to have a crystal clear vision of your ideal customer. And then build the campaign around their interests, needs, and desires. Has it ever been any other way?

Have you seen any direct mail campaigns that were awesome? I would love to hear about them in the comments below!

About Jessica Oman

Jessica's outside-the-box approach to business plan writing has helped her clients collectively raise almost $50 million in financing to start and grow new businesses. Sign up for her 5-part business plan training series for FREE here so you can get your business plan done and get your money sooner.

16 comments

  1. David Hooper says:

    So true! Now that so many companies have dropped traditional direct mail to do online campaigns, the effectiveness of even simple campaigns, like postcards, is increasing. Same for calling somebody on the phone.

    With that said, I think many online marketers, who have never done a snail mail campaign should use caution before jumping in. Because it’s so easy to send out tons of emails or do an online campaign, I think we’ve gotten sloppy with our marketing messages. When you’re paying for each one, that can add up quickly.

  2. Michal says:

    For me above examples show that if you know what are you doing, then you can use even the most basic tools and get the results. And no fancy tools will help me, if I don’t understand what I’m doing.
    So, go back to learning!

    1. Jessica says:

      We’re always learning, Michal! Like any marketing campaign, there’s no guarantee that it will be effective or produce returns. The best you can do is target, target, target to increase the probability of a successful campaign.

      But you’re absolutely right that neither fancy or basic tools will help you if you don’t have some idea of what the goals of your campaign are. Spray tactics are rarely successful. Enjoy your learning!

  3. Michelle Gale says:

    One of the things I look for in the businesses I deal with now is sustainability. If they’re willing to push this planet a little closer to the brink in order to make money, I don’t want to give them my business. With all due respect, when you generate unnecessary waste, that’s what you’re doing. We’re at the eleventh hour here. We can’t afford to be self-indulgent around things like this. I invite you to consider the contribution you’d like to make to the world and see how you’d feel about going green and helping your clients do the same. You could make a significant difference, and I bet you’d do just fine financially. You might attract business you otherwise will not. I know hundreds of entrepreneurs to whom sustainability is a primary value.

    1. Jessica says:

      You make a very important point, Michelle, but I disagree that this type of marketing is self-indulgent. There are ways to minimize the environmental impact of sending out a physical object. With a few exceptions like this, our office is pretty close to paperless and the majority of our marketing is still done online or in person at events (which tends to be cheaper, too!). Less waste is always better, which is another argument for a really targeted campaign, as it means your materials are less likely to be thrown away.

  4. Amandah says:

    Great testimony about the power of direct mail!

    Now that I’m a member of our local chamber of commerce (I take care of their social media, too), I want to create a small direct mail campaign. Why? Because I want to test the waters and see what happens. Of course, I can write about my results and help clients at the same time. :

    1. Jessica says:

      Hi Amandah, do you mean you want to reach out to the other Chamber of Commerce members? An interesting take would be to give them a benefit for being members as well. I find discount offers don’t usually work well, but maybe an added feature or service that you don’t offer the rest of your customers could have an impact. I’d love to know what you come up with!

      1. Amandah says:

        Hi Jessica,

        I wasn’t thinking about reaching out to members of the chamber of commerce through direct mail, but I could. My point was that I could use my membership as a part of my marketing strategy. Being a chamber member adds more credibility to my business. Client could hire me over another freelance writer who is not a chamber member and/or involved in their community.

        1. Jessica says:

          Gotcha. That’s the same reason we’re members of our local Board of Trade. I actually haven’t tried to leverage that in any of our marketing, but down the road some of the tech clients we’re looking to target would probably respond well to it. Let me know how your campaign goes!

          1. Amandah says:

            I will! I was just featured online at Cleveland.com and will be featured this Thursday in our Suns Newspaper. I’m super excited.

  5. Razwana says:

    I cannot remember the last time I even received anything in the mail from a marketer that used imagination over and above a piece of paper. A gift would get my attention for sure ONLY if it were relevant to me.

    I will be trying this one out to generate new clients fo’ sho’ !

    1. Jessica says:

      The gifting idea can work both ways, though. There’s a corporate gift company that sends me a free pen, which they’ve already printed with my company name and phone number. They repeat this campaign probably twice a year. Which is great for me – I get branded pens for free! Unfortunately it doesn’t work out to any revenue for them.

      Razwana, I’d love to know what you come up with for your next campaign!

  6. John Gibb says:

    hey Jessica

    3 clients @ $7,000 each, wow!

    What did you sell, business plans?

    I always felt that snail mail and direct copywriter is the way to go with any business, if done right. Your article reminded me to re-think my business and start learning out of the box strategies like this way.

    Much appreciated!

    1. Jessica says:

      Hi John, thanks for your comment! It was Ugly Mug that wanted 3 clients at $7k each. Our goal was different, but yes – we sold business plans (and all the consulting that goes along with creating a great plan).

      What’s the most unusual marketing tactic you’ve used?

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