Direct mail can be incredibly effective as a marketing tool, whether you’re wanting to drive engagement, increase sales or raise brand awareness. However, like any marketing channel, testing and optimising are key to tracking success as well as making data-informed decisions for the future, to help reach your marketing objectives. Keep reading as we’ve put together the best practice when it comes to testing and optimising your direct mail campaigns.

• The Importance of Testing Direct Mail Campaigns

• A/B Testing

• Multivariate Testing

• Optimising Your Direct Mail Campaigns

• Tracking & Measuring Success

• Create Successful Direct Mail Campaigns with DMS

The Importance of Testing Direct Mail Campaigns

Everyone says continuous testing is important when it comes to marketing campaigns, but why? Testing allows you to identify the key aspects or elements that resonate with your audience. Every audience is different, and therefore what may work for one company, may not work for another. A testing strategy can therefore help reduce the risk of any wasted budget on ineffective campaigns, as well as support the continued improvement of your direct mail strategies, as they will be based on data-driven results, rather than what you just ‘think’ might work. This is particularly vital in a world where consumers are increasingly selective about the media they engage with, making the ability of direct mail to cut through the digital noise a key component of a successful campaign.

What to Test?

The types of elements you may wish to test for your direct mail campaigns are:

• The design and layout
• Messaging and copy
• Offers and incentives
• Formats and Sizes
• Timing and frequency of sends

When planning your tests, consider the profound impact of personalisation. Personalising mail is crucial as it creates a one-to-one connection, with data showing that personalized mail is 30% more likely to be opened than generic mail, making it a critical variable to test. You should also test the tactile elements—different paper stocks, weights, and finishes—as they directly influence a consumer's perception of your brand, a topic we cover in depth in our guide on choosing the right paper stock and finishes.

A/B Testing

What is A/B Testing?

A/B testing, also known as split testing, involves sending two variations of your direct mail piece to different segments of your audience to determine which performs better. Only one element will be different between the two variations, in order to clearly see which aspects enabled the winning version to be the most successful.

How to Conduct A/B Testing

1. Define Your Goal: Identify what you want to achieve with the A/B test, such as increasing response rates, boosting conversions, or improving engagement.
2. Choose a Variable: Select the one element you want to test. For example, you might test different headlines, images, or offers.
3. Create Variations: Develop two versions of your direct mail piece. Version A (the control) and Version B (the variation).
4. Segment Your Audience: Divide your mailing list into two equal and random groups. The first segment will receive Version A and the second Version B.
5. Send and Measure: Mail the two versions and track the performance of each. Key metrics to monitor include response rate, conversion rate, and ROI. Just make sure they are sent at the same time (unless you are testing send times).

The ability to rapidly create and test small batches of highly variable mailers is now easier than ever thanks to advancements in digital printing. This technology is essential for effective A/B testing, allowing for cost-effective experimentation with different colours, imagery, and calls-to-action before committing to a full campaign run. For detailed guidance on achieving high ROI through testing, explore our insights on A/B testing techniques that drive ROI.

Best Practices for A/B Testing

Our three tips for A/B testing include:

1. Testing one element at a time in order to accurately attribute results to the variable being tested.
2. Ensure your test groups are large enough to yield statistically significant results.
3. Use tracking mechanisms like unique promotional codes, personalised URLs or dedicated phone numbers to measure responses.

Multivariate Testing

What is Multivariate Testing?

Multivariate testing involves testing multiple variables simultaneously to understand how different elements interact with each other. The benefit of this over A/B testing is that the testing of various elements can be conducted much more quickly.

How to Conduct Multivariate Testing

1. Identify Variables: Select several elements to test, such as the headline, image, and CTA.
2. Create Combinations: Develop multiple versions of your direct mail piece, each combining the variables in different ways.
3. Segment Your Audience: Divide your mailing list into segments that will each receive a different combination.
4. Send and Measure: Mail the different versions and analyse the performance of each combination.

Best Practices for Multivariate Testing

Our two tips for multivariate testing include:

1. Begin with A/B testing to understand the impact of individual elements before moving to multivariate testing.
2. Consider using marketing automation tools to manage the complexity of multivariate testing and data analysis, as testing various factors all at once can become complicated.

Optimising Your Direct Mail Campaigns

The optimising stage of a direct mail campaign comes after you have conducted your tests. From analysing the test results you can form clear learning that would want to implement going forwards to optimise future campaigns.

Before implementing large-scale changes, the foundation of optimisation must be robust data quality. Even the most perfectly designed mailer will fail if it reaches the wrong address. Dedicating resources to data processing and ensuring how clean is your data is key to maximising your postal spend. Furthermore, leveraging your test learnings to improve list segmentation is critical, ensuring you’re communicating the right message to the right audience, a strategy we cover in detail on how to segment your mailing lists for higher engagement.

Analysing Test Results

After conducting your tests, analyse the data to determine which elements performed best. Look for patterns and insights that can guide future campaign decisions.

Implementing Changes

Based on your test results, implement changes to optimise your direct mail campaigns. This might include adjusting your design or choice of colours, refining your messaging, or changing your offers.

Continuous Improvement

Optimisation is an ongoing process, so continuously test and refine your campaigns to keep improving results. Regularly review performance metrics and adjust your strategies as needed.

Tracking & Measuring Success

The key metrics to measure when determining the success of a direct mail campaign is the:

Response Rate - which is the percentage of recipients who responded to your mailer, in the form of taking the desired action, like making a purchase or signing up for a service. This is also commonly referred to as the conversion rate, especially if the CTA is to make a purchase. The average warm Direct Mail response rate is currently 7.9%, far exceeding average digital channel performance. Furthermore, research indicates that the average Direct Mail item is retained in the home for 7.4 days, increasing the opportunity for response and brand interaction.

ROI - stands for return on investment and is calculated by comparing the revenue generated from the campaigns to the cost of the campaign. The latest data shows that direct mail campaigns often deliver £3.90 average for every £1 spent for cold direct mail, and £2.90 for every £1 spent on door drops, demonstrating its high profitability and strategic importance in the marketing mix. Another key consideration when calculating ROI is the cost efficiency achieved through postal discounts and bulk mailing, which significantly lowers campaign expenditure.

Tracking Mechanisms

To track metrics such as response rate and ROI, you will need to include a tracking mechanism in your direct mail campaign. It needs to be something that you can measure to determine the success of the campaign, for example:

• A Promo Code - that is unique to that particular group of participants, or to each recipient entirely, so that you can track how many have been redeemed and therefore the overall success of the campaign.
• Personalised URLs - that are especially for your direct mail campaign, so that you can measure site visits and responses.
• Dedicated Phone Numbers - that are specifically for the campaign, and the number of call responses can be measures to quantify campaign success.

The rise of omnichannel marketing means tools like QR codes on direct mail are now a standard mechanism for seamlessly connecting the physical mailer to the digital conversion funnel.

Create Successful Direct Mail Campaigns with DMS

At DMS, we are here to support you in creating successful direct mail campaigns, whether you require complex fulfilment or high-volume mailshots. From printing and production through to postage and fulfilment, we can help you at all stages of your campaign. Our team are experts in their field, and we regularly work with clients carrying out mailer testing for optimisation, helping them to make different versions of their campaigns and manage the required sends.

Speak to the team for more information and to get started with a free quote.