MarketingSherpa Blog

Steve Reitmeister who heads up Zacks.com (who do online subscription sales for a lot of print newsletters on personal investing – see link to my case study on their tactics below), just gave me permission to share this note with you:

Too often all of us “Online Savvy” marketers rely so heavily on email because it is so cheap, so fast and has such great ROI. All this is true. But given the tremendous rise in email, many people are becoming “detached” from the medium.

What’s my point? We are starting to re-introduce a little bit of direct mail back into the mix as we are finding that it stands out more in this world of email overload. Here is my best example:

We recently tested sending direct mail pieces to current subscribers [originally sold via online] to entice them to upgrade to the annual subscription. The notion being that a commitment to annual subscription of $200 right now instead of $20 per month deserves more umph! on our part. And direct mail being more “REAL” gave us that extra umph.

Unfortunately we did not do a split test, but know from previous efforts that the response was superior. Here are the basic #s:

In the past we have emailed customers to upgrade to annual from monthly. We generally get a 1% conversion rate. But when we did the direct mail we got a 3% conversion rate. So lets say we were talking 1000 messages each.

1000 emails = cost of $0
1% conversion
10 new annual subscribers.
@ $200 per
$2000 in revenue
$2000 in profit

1000 direct mail pieces = cost of $500 (simple 2 page letter, stuffed in envelope @ 50 cents per)
3% conversion
30 new annual subscribers
@ $200 per
$6000 in revenue
$5500 in profit

For those who do ROI on % basis I guess the $2000 looks great against cost of zero. But I will take the latter any day of the week. Given the success of this I am also having my B2B group do more initial solicitation of prospects via direct mail with handwritten envelopes. I believe it will stand out more than the 100 solicitation mails they get on a daily basis.

Too early to say success rate, but my gut tells me it will be hard to go wrong.”

My note: Based on the Case Study I did on B2B subscription seller HCPro recently where they revealed DM gets subs that renew better than email sales, I would say Steve is onto a good idea.

Zach’s Case Study:
http://www.contentbiz.com/barrier.cfm?ContentID=2313

HCPro Case Study:
http://www.contentbiz.com/barrier.cfm?currentID=2376

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