Getting response is the name of the game. Whether it’s an order or lead generation, you need response to make your direct mail worthwhile. How can you afford to continue mailing the same offer if the response doesn’t make it pay off ? The answer, of course, is that you can’t. At least one of two things has to change—or both.
The first possibility is that the offer may not be appealing enough or may not be professionally prepared. Review it and alter it as necessary. The second possibility is that your list is not the right target audience for your offer.
It sounds simple, doesn’t it? But in reality, it takes much finetuning to make a list a winner.
To analyze your response cost, add up all the expenses involved in doing your mailing—postage, printing, stuffing, addressing, and any mailing-service fees. Divide this total by all the responses you received from this mailing within 60 days. After 60 days, the mailing becomes stale, and few (if any) customers will respond to it.
The number you get after you divide the cost by the response is your cost per response (CPR). Can you make a profit with this CPR? Maybe you can break even and make a profit from quick reorders. Can you sell other products to the responding people? You will need to evaluate these numbers to see whether more changes are necessary for your mailing.
Direct mail is not an exact science; the numbers can be different each time you mail. After several mailings, you’ll see a percentage range into which your response rate will fall. The question to ask yourself is whether you can be profitable and grow your business at this rate. And then, you can adjust as necessary.