Programmatic Direct Mail: A Modern Twist on Established Marketing
Direct mail is one of the most established marketing tools of our time. For as long as any of us can remember, receiving a brochure or letter in the mail from our favorite stores has been a staple of the American household. But with the arrival of digital marketing, many view direct mail as an old-fashioned and outdated marketing medium.
This is a dangerous assumption for those in the marketing industry.
In fact, quite the opposite seems to be true. Direct mail is providing advertising companies in the US with a 1,300% return, with an average ROI of between 18 and 20%. Moreover, last year direct mail had a response rate of 4.9%, the highest since 2003, and still pulls a higher response rate than any digital direct marketing medium.
Direct mail hasn’t continued its dominance in a vacuum, however. Largely, this success is due to the emergence of programmatic direct mail. In this article we discuss what programmatic direct mail is, how it works, and look at the impact it’s had on the “old-fashioned” direct mail marketing system.
What is Programmatic Direct Mail?
A simple way to consider programmatic direct mail is to think of it has a marriage between digital data and retargeting. Platforms such as PebblePost search for specific indicators as consumers browse the internet, and focus on how an individual interacts with a brand or product online. For example, it will track a consumer’s website browsing and make a note of when an item is added to a shopping cart but not purchased, or when a particular social media post about a product is made or read.
At this point you may be thinking, “Well, this is nothing new. Plenty of algorithms do this.” And this is true. But here is the difference: instead of simply delivering a programmatic advertisement on the consumer’s screen, the programmatic direct mail algorithm will send direct mail.
Here is a quick example to demonstrate how it works: You are a customer who just created an account on Nike.com to get a new pair of kicks at 10% off. You open the email that was just sent to your inbox and shop around the site for a bit. You add a couple of pairs to your shopping cart that you’re on the fence about, but you leave without making a purchase. Instead of another algorithm meant to flood your screen with annoying ads (which may happen anyway), the programmatic direct mail algorithm will kick in and send you a post card with a personalized offer inside.
Connecting Online and Offline Behavior
As we saw above, programmatic direct mail combines data-driven decisioning with automation to enhance marketing efficiency and optimize consumer response. And it does so by connecting the online and offline behavior of consumers without trying to change their behavior altogether.
Lewis Gersh, CEO of PebblePost puts it nicely:
Unlike digital advertising, Programmatic Direct Mail doesn’t attempt to change a consumer’s behaviour. If you think about how consumers use their devices, it’s very task-oriented. . . If that consumer is predisposed to engage with a piece of Programmatic Direct Mail, they can do so when the situation is best for them, as we provide a tangible, physical reminder. We make it easy and desirable for consumers to engage with that brand message — on their terms — and act on it however they like, by returning to the brand’s website or visiting a store, for instance.
As Mr. Gersh points out, programmatic direct mail leverages consumers actions online and their task-oriented approach on digital devices. While many digital marketing tools expect (or assume) immediate responses by consumers, programmatic direct mail allows them to respond on their terms.
Solving Direct Mail Problems
A few of the main criticisms of direct mail over the years is that there are often long lead times to production, data is either difficult to collect or out of date, and it often requires significant capital resources to keep the tool moving. Indeed, it’s difficult to match consumer needs with direct mail campaigns when most of the consumer’s data is now tracked online, and by the time data is collected, the time it takes to produce and deliver direct mail leaves it obsolete.
Programmatic direct mail integrates the benefits of digital (e.g., data optimization, targeting, etc.) with the consumer preference of direct mail. The marriage of the two mediums produces a new, high-functioning marketing channel that can be used across web and delivered to anyone with a mailing address.
