Cost of Marketing IV: Direct Mailers & Telemarketing

Advertising is the mainstay of any successful business. No matter what your product is or how great your service may be, no one will use it if they don't know it's there. Some of the most popular methods of advertising include email, print, and broadcast advertising campaigns. However, many businesses many not have the budget for a successful print or broadcast campaign, while others may not have a Web site for e-mail advertising. What do they do instead? These businesses have relied on direct mail and telemarketing to get the word out about their products and services.

Direct mailing and telemarketing have become more difficult over the past few years. As the price of postage rises, the cost of a direct mail campaign has risen as well. In addition, the federal Do Not Call Registry, which prohibits telemarketers from soliciting anyone whose name is on the list, has all but crippled the telemarketing industry. However, in the right situations, direct mail and telemarketing can be a cost-effective way to market a new business.

Begin with a list

A successful direct mail or telemarketing campaign begins with choosing the right list. The easiest way to begin creating that list is to start with your current customers, then build outward geographically. The Census Bureau and other data suppliers provide specific demographic data sorted by ZIP code. You can use this to get a better understanding of your geographic market. You can also use the demographics of your current customer base to find prospective customers. If these people buy your product, then people like them will most likely be interested in your product as well.

Direct mail

One of the most powerful forms of advertising is direct mail. Next to newspaper and television advertising, direct mail is the third largest advertising medium in the United States. In fact, a recent survey of consumers showed that direct mail is the preferred method of communication when receiving marketing materials from companies.

Direct mail can include sending brochures, announcements about store openings and events, coupon books, and samples to help increase awareness. For most small businesses that cannot afford television or radio commercials or newspaper ads, direct mail can provide a cost-effective way to target current and potential customers.

Direct mail advantages

A direct mail campaign will offer numerous advantages to a company. Not only can the advertising message be targeted to a specific group, it gives marketers the ability to reach a wide geographic range. And, by using different printing techniques, the marketing message can be personalized to the receiver. In addition, because direct mail uses a printed piece, the message can be given longer than a telemarketing call, television commercial, or newspaper ad. Finally, since people can receive the information in their home or business, they can read it at their leisure, and they may feel less threatened than if they had to speak with a salesperson or telemarketer.

Direct mail disadvantages

Direct mail does have its disadvantages. Many direct mail pieces are often perceived as "junk mail" and may be thrown away before they are even read. Excessive design, printing, and postage costs can also make direct mail an expensive advertising option. To keep costs down, businesses may work with a printer to find out what size mailer is cheaper to send, and what other ways there are to cut costs. An attention-grabbing outer envelope and personalized letter can catch a reader's eye, and can sometimes be done with a smaller budget.

Telemarketing

Government regulations have made it more difficult to use telemarketing as an advertising tool. Telemarketers are prohibited from placing telephone solicitations to anyone who registers on the national Do Not Call Registry or specifically requests that a particular business does not call them. However, if a business has an established business relationship with a person, a telemarketing call can answer questions and address particular interests in a way that no printed material can.

Telemarketing advantages

A telemarketing campaign will typically generate a six to eight times better response than direct mail. These results are highly measurable, making telemarketing an effective way to introduce a company or a new product. Telemarketing also helps maintain contact with existing customers, or set up future appointments with prospective clients. There are no printing or postage costs, and even if you hire a professional caller, the costs are usually minimal.

Telemarketing disadvantages

Probably the most obvious disadvantage to telemarketing is that people have become wary of telemarketers, and many people are using caller identification systems to screen unwanted telemarketers. Telemarketing can even give a company a negative image if done incorrectly. In addition, the recent government measures implemented to curb telemarketing have made it difficult to accomplish this form of advertising. Telemarketers must download an updated national Do Not Call list monthly at www.telemarketing.donotcall.gov and drop any registered phone numbers from their call lists before making calls.

This does not mean telemarketing should be discounted altogether. By hiring a professional to prepare an effective script and delivering a short, conversational call, a business' sales team may be able to make appointments for demos or a meet to talk about the company much easier than with other forms of advertising.

By taking the time to build an effective direct mail or telemarketing campaign, telemarketing and direct mail can be cost-effective resource to help find and retain consumers.