Verticals that Use Direct Mail Are Great Targets for Digital Ads

What Verticals Heavily Use Direct Mail?

Direct mail is a tactic that occurs most often in direct-to-consumer promotions. It’s also typically at the local level. According to direct mail trend data, the top industries using it are:

• Retail
• Nonprofits
• Finance

These three make up around 65% of the production. Restaurants, recreation, real estate, services, education, health care and media also contribute to the direct mail ecosystem. For these local advertisers, direct mail can account for 20.7% of their ad budget, according to the BIA U.S. Local Advertising Forecast for 2022. However, it’s second to mobile digital ad spend.

Of note and not recognized as a vertical is political direct mail ad spend. Experts predict record-breaking ad spending across all channels for the year’s midterm elections. Direct mail is always a channel these advertisers use.

Direct Mail Targeting Isn’t Perfect

In any of these verticals, the business’s goal is to entice consumers with a promotion. However, they have little awareness if the person or household is a “good prospect” for them. The reach of direct mail is broad. Some segmentation takes place for the messaging to make sense. For example, a pool cleaning service could use data to only send flyers to homes with pools.

Offers via direct mail are often time-sensitive, tied to a holiday, season or exclusive price. The urgency to respond is central to the copy on these mailers. That could prompt a response, or it could be too late. Not everyone checks their mail daily, and delays are pretty standard with mail services. A direct mail piece that’s no longer valid is a waste.

The biggest challenge that any direct mail campaign faces, besides relevancy, is that many people dump them right in the recycling bin without a glance.

Direct mail can still provide favorable response rates for these verticals, but they shouldn’t put a disproportionate amount of their ad spend in that bucket.

Digital Advertising and Direct Mail Can Work Together

In the end, it’s not an either-or situation. Advertisers can use both methods, and they can complement each other. The sophistication of digital campaigns has advantages that can work with and accelerate the results of direct mail.

In the case of direct mail, you can target with some key information like ZIP codes, property information or household demographics. It’s a broad stroke that can encourage consumers to take advantage of the offer. However, advertisers can’t know exactly if the receiver needs the product or service.

Digital advertising can provide more relevancy. Your customers can get in front of people actively seeking their products or services.

Using both methods reinforces messaging and brand awareness, so your advertisers have broad visibility.

How Digital Advertising Can Drive Profitable Results

With digital advertising, you have multiple options to present to advertisers. You can help them meet their objectives to acquire new customers and retain existing ones. Digital advertising isn’t a replacement for direct mail. In an integrated campaign, they can both serve advertisers. Here are some key digital tactics to recommend in tandem with direct mail.

SEM

SEM (search engine marketing) is a primary tactic for verticals that use direct mail. It’s where most purchasing journeys start. According to Google, 53% of shoppers do research prior to making a buying decision. To find local businesses, one-third of consumers start with search. And, if a person receives a direct mail piece, they are likely to head online to learn more.

The leads that come from search also have a much higher close rate than outbound tactics, receiving a 14.6% close rate versus 1.7%.

Local advertisers need to have a presence on search. If they don’t, they are losing out on many potential conversions.

Talk to companies about the importance of this strategy, how SEM campaigns work and why they are worth an investment.

OTT and CTV

With the significant uptick in streaming across all demographics, over-the-top (OTT) and connected TV (CTV) video advertising is growing. BIA notes in the 2022 forecast that it’s a small but rapidly growing segment of the local advertising pie. The expected CAGR (compounded annual growth rate) through 2026 is 19%.

OTT ads can be impactful and deliver results. They are video, so they have high engagement. Targeting is also available by geography, preferences and previous digital interactions. In most cases, the ads served to viewers are relevant to them. With relevancy and engagement comes conversions.

If target viewers receive a direct mail piece and then see an ad on OTT or CTV, the brand can build equity. Multiple engagement opportunities help with retention. So, when a person needs a service or product, they’ll recall the company they keep seeing.

Display Ads

Another digital advertising option for your customers is display ads. What’s great about these is that you can test many different scenarios and update offers that correlate with direct mail messaging. 

With retargeting or geofencing, you can get in front of customers most likely interested in the business. Retargeting serves ads to those who previously visited a website. With a special offer, they may return to book a service or make a purchase. 

Geofencing delivers digital ads based on location via a mobile device that shares this information. Thus, if a person enables location data, they may see an ad for the restaurant around the corner or grocery store at the next block. Geofencing performs well, with 53% of shoppers visiting a retailer after receiving a location-based message.

Social Media Ads

Another channel that works well for local advertisers is social media advertising. It allows advertisers to target specific groups based on demographics, interests, preferences and more. It can be an inexpensive ad option that works to attract new customers. 

Since social media is part of most people’s daily life, people use it to discover new products. In research about the success of social media marketing, 69% of companies said it generated leads, and 60% said it improved sales. 

Social media ads are critical to an integrated campaign, ensuring your advertisers have visibility in this channel. Adding it to their marketing mix helps with retention that can elicit the actions advertisers want.