Yesterday I sent a results report to a client for a pay-per-click (PPC) search lead generation campaign that my team managed. It showed a performance that was five times higher, in terms of cost-per-lead, than a traditional direct mail campaign. That’s pretty cool. But as I sent the report, I was reminded of this recent report from eMarketer:
It shows how a majority of marketers favor direct mail for lead generation versus search marketing. Scott Brinker was rightly puzzled by this, in a recent post. I agree with Scott that a chief reason for this strong preference for direct mail over search engine marketing (34% versus 8%), when it comes to customer acquisition, is the difficulty many marketers face in getting search prospects to convert.
Indeed, if the lead acquisition campaign my team was leading was instead a customer acquisition campaign, the results would likely have been closer to a dead heat with direct mail in terms of ROI.
But what does that mean? Just that we’re not trying hard enough. As marketers, I feel we cannot allow so many opportunities for conversion to click away from landing pages. There are many tested techniques for improving conversions (new offers, testimonials, guarantees, Web 2.0 landing page design). There are also spectacular new tools to do multivariate testing of these techniques.
Let’s take direct mail for what it should be. It is (usually) the customer acquisition benchmark. Now let’s shift more resources online, but apply them where it really counts: To create campaigns that actually surpass the mail in delivering a strong ROI.
Hi, Jeff. Thanks for the mention in your post!
You know, the other funny thing I noticed in that report was the relationship between customer acquisition and customer retention. Maybe it’s just my flawed intuition, but as surprised as I was about the ROI dominance of direct mail for customer acquisition, it made more sense to me as a customer retention device. If you receive something in the mail from a company you’re already doing business with, it would seem to have an edge. But direct mail was 1 point less for retention than acquisition. Probably just due to the ROI for email marketing to existing customers being so cost-effective, which makes sense. But at first glance these numbers were a bit of a surprise.
Great topics on your blog! Noticed that we share an interest in Tufte and visualization. Just recently was exploring VisualComplexity.com and wrote a post on it here.
I agree, Scott, that it’s odd that direct mail doesn’t rank higher for customer retention. Especially with catalog marketers and non-profit fund raisers, the mail is still by far the most successful way to keep customers.
Also, I appreciate the link to VisualComplexity. I’ve drawn inspiration (or pulled examples) from than portal more than once. Explaining visually is more important today than ever, since we’re all drowning in data. Even eMarketer can use some help. This post from late last year took one of their standard tabular charts (as shown above) and improved its effectiveness by adding differing sized circles to back up the percentages reported.