by Andrea Lane
Could GDPR signal a return to more traditional direct marketing methods?
Now the GDPR dust has settled a little and many customers have rejoiced at the quick-win overnight clean-up of their email inboxes and approved sender lists, just how might the new legislation affect companies’ decision-making when it comes to contact channel selection for data-driven marketing?
GDPR puts greater control and protection in the hands of the consumer when it comes to their data. Brands must be more transparent and are now held to higher standards for collecting, storing and processing data. Clean data is a marketer’s best friend and with GDPR re-confirmation rates for email averaging just 10% i it might lead us to wonder whether more traditional marketing methods that have been in decline over recent years will now enjoy something of a happy resurgence.
Forcing the marketer’s hand to confront the question of the efficacy of email
Of course, the growth of the web and its ever-increasing importance in most businesses (retail in particular) has firmly established email as the ‘go-to’ channel for contacting customers. But has its affordability and flexibility caused an over-reliance on email for customer marketing? Achieving stand-out amongst all the inbox ‘noise’ has called success rates into question for some time now. Junk email has become more of a burden to consumers than junk mail.ii
“Because email works so well, it is probably not surprising that marketers reported sending an average of over 4 emails per month. Yet at the same time, consumers are saying they get over 21 brand emails per week and that most of these are untargeted and irrelevant. More worrying is that 42% of marketers agree that some or none of their email is actually relevant to the people they’re sending it to.” ii
As for open rates, it’s much easier to click ‘delete’ without even looking at the content of an email than it is to dispose of letterbox mail without at least opening the envelope to see what’s inside. Investing more time in better planning and targeting and more money in alternative (albeit more expensive) marketing media could see improved returns in the long run.
Where budgets permit and content is relevant, at Ikano we have always championed the use particularly of selective direct mail and SMS, having seen both markedly improve response rates and incremental sales.
Knowing your customers is the single most important success factor for direct mail
Granted, the prohibitive cost of direct mail has led to it becoming increasingly off-putting for many businesses - the main exceptions being catalogue-based companies, large financial institutions, supermarkets and major players in the market with voucher-based loyalty schemes. With bigger budgets comes economies of scale in pricing but smaller business can benefit from direct mail too - provided they know their customer base well enough to understand who will and won’t be likely to respond to a mailpack landing on their doormat and the right type of offers to elicit such a response.
Rigorous targeting is critical for ensuring a positive ROI. Long production lead times can also be a barrier to its use in a fast-paced world or when time is of the essence. Its tangibility and potential for creativity, though, can mean it wins through on impact.
If direct mail is to be relied upon in a business, a robust system for recording gone-aways and regular database cleansing is as important as any campaign planning decisions.
The power of SMS - where relevancy and timing are right
SMS offers only limited content, of course, and can be perceived as intrusive, but if deployed with consideration, for the right kind of purpose and backed up by a reliable contact history to ensure acceptable messaging intervals, it can serve as a valuable and relatively inexpensive tool - either on its own or as part of an integrated campaign.
At Ikano we have observed up to a 14% improvement in response rates when SMS is used compared with email alone.
Taking far less time to create than an email it is the ideal solution if a message needs to be broadcast at short notice. Simplicity is key.
Given the latest reported £30:£1 email ROI statistic ii it will long continue to enjoy its place in the marketer’s armoury. The impact of GDPR though might just usher in renewed consideration of alternative contact channels and their respective merits. Keep an eye on your letterbox.
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If you like this, you may like:
i. Jones, R. (2018) ‘Why the GDPR email deluge, and can I ignore it?’ The Guardian, 12 May
ii. DMA (2017) DMA Insight: Marketer Email Tracking Study. Available at: https://dma.org.uk/uploads/misc/589c5b9eaaca9-marketer-email-tracking-report-2017_589c5b9eaabde.pdf (Accessed August 2018)