Small Business Toolkit

Direct Mail ROI Calculator

Direct Mail ROI Calculator

Remember in the dark ages before the internet was in the palm of our hands? When we weren’t as fond of emails and the main way to market your business was through leaflets and pamphlets?

So it’s no surprise direct mail is still a very popular marketing channel.

If you’re here you probably dabble in some direct mail marketing so you’re no stranger to how costly it can be.

That’s why we made this nifty calculator to check your ROI from your direct mailing campaign.

Calculate your Direct Marketing ROI

 

Why Measure Direct Mailing ROI

Let’s take a quick look at what it takes to create a direct mailing campaign and distribute the mail out.

First of all there’s production, and that can be quite costly depending on what you’re creating and the tools you’re using.

That includes: Paper, ink, design team and printer, not to mention the absurd amount of time it can take to make.

Then there’s the distribution, of course you can mass ship your pamphlets and leaflets or include them in packages ordered online.

But if you’re a local business you may also hand deliver them to customers and people. That’s a lot of work and time, and if you’re driving it costs gas as well.

So not only are you putting in a lot of potential money, but you’re also using a lot of effort and time, which would could be a potential waste if you don’t know what your ROI is.



How to work out your Direct Mailing ROI

It’s quite simple to work out your direct mail ROI. It’s exactly the same as working out any other ROI.

You’ll firstly need to define what you class as your campaign costs, this could include costs for design team, and actual gas if you’re driving.

The formula can be a little confusing to work out the ROI but it makes more sense when broken down.

The ROI = total revenue / total spend

To work out the ROi you need to multiply the number of leaflets or pamphlets you produced by the response rate of the news letters.

This is usually an estimate as it can be difficult to gauge response rate to your direct mail, to try and get a more accurate reading include a promotional code you can track back to the campaign.

Then you need to multiply that by the number of estimated customers who purchased something because of your direct marketing campaign.

This also may seem a little difficult, but you can make this more accurate by adding special codes or exclusive products for people who use a code from the pamphlets.

After that you just need to subtract that by the total costs of the campaign and divide that by the total costs.



Some Advice

It’s no secret the general public are skeptical of marketing.

It’s even less of a surprise people dislike direct mail marketing almost as much as marketing calls or scam calls.

It’s all chalked up to the negative stereotypes and people tend to make it worse.

So here are some tips to get your mail read and loved.

– Make your mail useful! Make sure your mail isn’t just shameless promotion, include some products your general audience finds useful, include some tips and advice. Even something as trivial some life advice quotes can make a big difference.
– Treat your customers like actual people. People like to see there’s a human behind the business. So add some personality and some empathy to your marketing. Give them a gift for being a loyal customer. Condiments go a long way.
– Make your promotions obvious and in the face, but not too in the face. If you’re offering useful products with promotions then your customers will not only see you as a convenience but they will have a better chance of converting.
– Make your package attractive. The first thing we need our customers to do is open up the package. So don’t just make it look nice, fancy and, include some gifts or product samples (Refer to point 2)  this way customers are not only opening your package they are loving it!
– Always think about AIDA (Attention, Interest, Desire, Action)