20 Jul Internet and Cable Company Reduces Direct Mail Cost While Increasing Responses, Sales, and ROI
The Director of Marketing for a regional internet and cable company was struggling with creating and managing direct mail campaigns through their ad agency.
That agency was selected for brand and advertising creative, and direct mail programs were treated as an afterthought. After the agency provided direct mail creative, the marketing team had to manage the production and mailing process through their local printer. The process was not efficient or as effective as it should be.
The Director and his team understood that direct mail was a critical part of the marketing mix and a very large use of resources. They were challenged by senior management to find new ways to be more effective with the company’s direct mail budget. Agency costs, based on the retainer/hourly fee model, were too high and impossible for the Director to control. He realized the agency team did not have the knowledge they needed to reduce costs, or to optimize direct mail performance. He knew he needed to make a bold change to the status quo and began to look for a new direct mail partnership.
After a comprehensive evaluation, the Marketing Team selected RPM to improve their direct mail programs and processes. RPM brought several clear benefits to the table, including:
- A senior level team of experts solely focused on direct mail performance.
- 20 years of industry experience with acquisition direct marketing for internet service providers (ISP) and telecommunications clients.
- An extensive catalog of interesting and varied direct mail formats—tested and proven for high response and sales performance.
- A powerful process to accelerate learning and uncover data-driven performance breakthroughs.
- A cost-saving, turnkey, fixed-bid approach for setting predictable program budgets.
The RPM team quickly came up to speed on the clients existing programs and developed a fresh course of action to:
- Increase direct mail testing in package format, creative, offer and price.
- Use proven, interactive direct mail formats with more real estate for education, and a deeper explanation of ISP product benefits and features.
- Utilize RPM’s industry experience to create new packages on a tight timeline.
The Director and company management were extremely pleased with the RPM engagement and the early results.
Initial Test – Within the first program, RPM’s new package boosted the overall response rate 10% higher than previous programs. Testing also revealed a package format change that resulted in a 35% higher response rate, while also upselling consumers to a product with a higher monthly revenue and producing greater lifetime value.
Continued Testing – The second test program featured another new format test, new creative, as well as offer and price testing. Results from the second test revealed that the company could generate an equal level of response and sales with a higher priced TV package, based on RPM’s new creative approach. This level of sales with a higher value offer produced a greater ROI. The learning gained was a breakthrough from the status quo, as it was always thought that the lowest price was the best offer.
Through their partnership with RPM, this internet and cable company has been able to quickly improve sales and ROI while also accomplishing a significant savings over agency retainer hours. The company continues to partner with RPM for its direct mail, and the combined team continues to test and learn to find even higher levels of direct mail acquisition program performance.