Using Data and Variable Messaging to Rethink the Direct Marketing 40/40/20 Rule
The 40/40/20 rule was developed over 60 years ago by direct marketing pioneer Ed Mayer to convey the value each element of a direct mail effort contributes toward driving results. The rule purports that 40% of direct mail success is attributed to the mailing list, 40% from the offer and the remaining 20% from the format, design and copy of the mail piece.
Historically, marketers could only build target audiences using a few data attributes and create a single offer to all of them. With significantly more data available on individuals and technology to create personalized messaging to each recipient, there is a new opportunity to rethink how the list and offer strategy is developed. Consumers are looking for more personalized engagements, and to achieve this, marketers must be more strategic in their approach to the audience “list” and “offer.”
Rethinking How We Look at the ‘List’
Sending out mailings to a broad audience that may or may not be interested in your product, mission or service can be costly. If you are marketing to hundreds, thousands or even tens of thousands of individuals, how can you truly understand their interest in your products, mission or services and treat them as they wish to be treated, in a personalized manner?
The answer is found using data analysis to gain a deeper understanding of your audience and those most likely to respond can give you the information needed to increase engagement and significantly improve ROI.
Gaining insights into “who” is in your database using a combination of first- and third-party data attributes can expand your understanding to aid in creating audience segments. Examining the activities stored in your database can help you learn “what” they purchased or supported, as well as “when” and “where” they took that action.
Drilling into these activities will help you understand what level they’ve engaged with your organization and can provide a broader foundation to build upon your current relationship with them.
Taking this step and developing audience segments will provide much better results than just mailing to everyone in your database. You can also go beyond the who, what, when and where to find the “why” by conducting surveys with your audience to learn what emotion is best suited to motivating your audience to engage and act.
With data insights and an audience segmentation plan, you can speak to recipients in a more personal way with individualized “offer” messages that are more likely to engage them and inspire them to act.
Don’t Just Make an Offer. Engage Them with Insight-Led Emotional Messages
In marketing, one size does not fit all. Multiple studies show that people pay more attention to communications that are personalized. It makes them feel special. In fact, 84.2 percent said they were more likely to open/read a piece of direct mail that was personalized.
People make purchase decisions (and that includes charitable giving) for emotional reasons. According to a 2016 Nielsen report, “Emotions are central to advertising effectiveness.” Additionally, ads that utilized the best emotional response generated a 23 percent lift in sales volume.
Emotional connections through good storytelling, based on audience insights and segments, enhances the success of these efforts – which makes a significant impact on results.
As noted in a post on Sprout Social, when customers feel connected to brands, 57 percent of them will increase their spending with that brand and 76 percent will buy from them over a competitor.
Adding only a person’s full name to a direct mailing has shown to increase the response rate by 135 percent. Imagine what a strategy using audience segment insights and hyper-personalized emotionally engaged messaging can do on top of this. With data and audience segmentation, we’re able to key in and create multiple messages within a single mailing.
Take Your Direct Marketing to Another Level
It’s clear the path to direct marketing success is to revisit how you think about the 40/40/20 rule by making the effort to gain more insights about your audience and develop hyper-personalized messaging to emotionally engage with them.
Take a look at this approach in action with just a few examples of how we’ve taken direct mail success to a new level:
- See how we helped Schoolcraft College double enrollment when compared with their previous initiatives – not by increasing mailing pieces, but decreasing them.
- Audience analysis and personalized messaging through an omni-channel strategy helped to increase total individual giving revenue for the Animal Welfare League of Alexandria by about 200 percent within three months.
- After obtaining data insights through a variety of avenues, we developed a donor-centric fundraising communications plan that, when employed, significantly increased donor responses and revenue for the Coalition on Temporary Shelter.
Contact us to learn more about our multichannel marketing strategies.