Merkle has a wide array of performance marketing strategies and tactics at its disposal to drive response. Often these techniques use cutting-edge digital technologies or modeling techniques, and sometimes both.
But just as often, we find that low-tech approaches can generate response magic too. Case in point: we’ve found that email, when combined with direct mail, can generate response rates 1.5x to 3.8x higher than direct mail alone. And in this instance, when we say response rates, we’re talking about phone calls only (when clicks are added to the response measure, the impact is even stronger).
First, some background.
We’ve been working with a large wealth management company that provides workplace retirement savings plans to organizations in the public sector. Our focus over the past four years has been on plan participant engagement and retention: getting people to contribute more to their plan today, while also nurturing them to stay with the wealth management provider tomorrow.
Our strategies always include a wide array of tests and experiments — direct mail format, email subject line, list tests with third-party data overlays, and others. But a few years ago, we started looking closely at the impact of the mix of direct mail (DM) and email (EM). The goal was (and is) to optimize the mix — generate lots of response and participant engagement, but do so cost efficiently. Since email costs virtually nothing to deploy, we’ve experimented with various combinations of DM only, EM only (including multiple touches of EM) and DM + EM.
We’ve been tracking this now for 20+ months, and we see the combination of DM and EM generates call volume of 1.5x to 3.8x higher than DM alone. For some audiences, the impact is even higher (4x to 5x higher response). These impacts span a wide range of campaign messages, audiences, and market conditions. And with these campaigns, consumer engagement is high — email open rates range between 30%-50% — and opt-out rates are consistently low.So the mix of EM and DM seems to be effective; the question is, why?
Our current theory is that within the audience receiving both DM and EM, there are two groups: those who prefer email communication and those who prefer direct mail. Sending both types of messages in a campaign activates both groups. There also may be an additional impact across both groups due to the multiple touches (people with an email preference are triggered after receiving the DM piece, and vice versa).
When we do email-only, we see 40% to 80% higher call volume than DM-only. We also see very strong impacts when multiple emails are sent to the same audience — but these impacts aren’t as significant as when DM is added as a touch.* It should be noted that DM-only still performs well in generating call volume, particularly among more affluent and/or older audiences.
But even with these additional insights, our theory is just a theory — we don’t yet know exactly how this mix works. We continue to explore additional sources of data, and are conducting additional tests and analyses to validate the theory. Stay tuned.
For now, we just know this approach works.
* Note: most of the audience in our EM-only vs. DM-only tests has been consumers aged under 40.
