Whether you’ve pretty much finalized your 2024 marketing budget, or you’re still scrambling to nail it down, chances are it’s going to have to change (again and again) throughout the new year. Given the uncertain economy, marketers need to be more flexible, and more ready to turn on a dime, than ever.
At Quad, we work with more than 2,900 brands — across every conceivable vertical, from retail and healthcare to CPG and financial services — and what we’re hearing across the board is that marketers are being asked to do more with less. That’s particularly true when it comes to direct marketing, given rising costs across both online and offline channels.
The good news is that when you let data and logistics lead the way, and when you evaluate every channel — including print — with rigor, you can optimize without compromising effectiveness.
With that in mind, we’ve created a 10-part DM budget planning checklist that focuses on the discipline — direct mail — where marketers often see the best response but are struggling with inflationary pressures (particularly postal rate hikes and increased paper costs).
1. Reduce postal costs by bypassing specific mail-processing locations
Partnering with DM vendors that have significant scale allows marketers to benefit from logistics operations that can reduce processing steps, delivering greater postal savings — and speed to in-home.
2. Choose direct mail formats and designs that are optimized for postal savings
New direct mail formats can offer postal savings based on size, weight and other factors. They also deliver production and material efficiencies. And specific designs, offers and promotions can benefit from rate reductions, based on the USPS promotions calendar.
3. Know your pre- and post-production commingling options
Commingling saves money by bypassing the mail-sorting step. Ask your DM printing vendor about commingling your data files ahead of production for a direct — and less expensive — print-to-carrier solution.
4. Maximize rates through list optimization
Go beyond basic list hygiene and adopt advanced optimization techniques. Are you strategically removing and adding names of customers and prospects? Are you using advanced matching techniques for your merge/purge process? Are you using other data sources for change of address beyond NCOA?
5. Consolidate production into one stream
Digital inline printers with advanced personalization capabilities can take dozens of different DM programs (with various formats, designs and messaging, depending on audience segments) and integrate them into one print stream while maintaining program diversity and cutting costs.
6. Use modern pre-launch testing techniques
By testing creative virtually, or by using AI, in-market testing can be avoided or significantly reduced, bringing tremendous savings to your bottom line. Waiting months for in-market testing costs time and money. Virtual testing has been proven to boost response rates and beat controls.
7. Measure more, save more
Determine incremental return on ad spend by strategically holding out part of your program (up to 10%). Holdouts can provide major savings while baselining what your program is truly worth.
8. Reduce expenses by reducing handoffs
Every program, every touchpoint, every step (creative, production, delivery) can require handoffs from separate teams and providers. Every handoff is an incremental “tax” paid by the brand. Integrate — and save time and money — by choosing vendors that can execute on more marketing steps and deliver on more touchpoints while improving brand consistency.
9. Use your data to find incremental savings
Try modeling your audiences to predict the optimal contact strategy. You may be able to reduce the frequency of your touches, saving money across the board, while more precise targeting can reduce your customer acquisition costs. Finding optimal distribution profiles can maximize reach across channels, formats and delivery vehicles.
10. Track mail the same way you track digital
Mail tracking and list intelligence are more automated than ever. With greater visibility into mail performance and list management, marketers can save by eliminating waste and reducing delivery times while improving multichannel coordination and call center management.
Want to learn more and continue the conversation? Check out Quad’s 2024 Direct Marketing Budget Planning Toolkit, which includes a downloadable version of the above checklist plus a webinar, “Direct Marketing Cost Optimization to Save Your Budget,” that you can stream on demand.