Direct mail can be a very effective way of spending your marketing dollars; you can reap some very nice returns, but doing it right is the key. First, determine what your goals are. Do you want to bring in new customers, sell to existing customers, promote a new item or announce a new location?
Once you have a goal in mind, choose the type of mailing that will reach that goal. Direct mail has two basic categories: saturation mailing (in which you saturate an entire area) and target mailing (in which you have specific addresses and target specific groups and/or customers). In either case, the most important part of your direct mail efforts is your mailing list, because a bad list can cause numerous problems which waste money on printing and postage. It’s been said that about 60% of the success of a direct mail program depends on the list; about 30% depends on the offer; and only about 10% depends on creativity.
Let’s look a little deeper into the different types of direct mail.
Types of Direct Mail
Saturation Mailing. “A saturation drop using complete carrier routes around your store is the least expensive avenue to reach the masses in your area,” says Mark Sibilia from MyPizzaPromo (www.mypizzapromo.com), a design, print and mailing company based in Richmond Hill, Ontario, Canada. “This is used most often by operators and should be done often to attract new customers and remind current customers that you’re still around.”
Sibilia suggests, however, that the greater benefit of this form of mailing is that, if done consistently and with the proper methodology, these efforts can really paint a clearer picture of who your best customers are, which is most important for the future success of your business.
“Once you decide to try this avenue, you could choose to do a lot of the legwork yourself, which will take you a lot of time,” continues Sibilia. “And not knowing all of the ins and outs of this process could potentially cost you a lot of wasted money as well. So the first step is to get an address list of occupants (no names; just addresses) that comes with a breakdown demographic stat sheet and a map of your whole area. You can specify this request by zip code, a radius/driving distance that you wish to service, or by the number of residents around your store.” Sibilia says that the stat sheet is filled with important demographic information, which is broken down by averages within each carrier route as follows:
• The number of houses, apartments and businesses (this allows you to choose any or all)
• The average income per family
• The average house value
• The percentage of families with children
• The distance from your store
Although some of you already have a good feel of who and where your best customers are, the above information is still important for the following reasons: It allows you to view routes with similar demographics so you can send to similar areas; and you can reach your potential within your area by testing an entire area. As you consistently drop mail around your area, hitting different groups of demographics month in and month out, the picture will become clearer.
Sibilia says that his company’s research shows that you’ll need to hit the same area five times to truly gauge the potential. As the response comes in after each drop, you will be able to, over time, focus your marketing dollars on your most loyal demographics and save thousands of dollars by not marketing to a group that will never walk into your store. “This is where most operators fail,” he explains. “They drop a couple of times and, when they don’t get the response they hope for, they stop. But the only way to really thrive and succeed is by failing along the way and using the knowledge gained from your loss as wisdom for the future.”
Target Mailing. This form of direct mail is another important strategy within your advertising campaign. To beef up your database, most restaurant consultants encourage the purchase of a point-of-sale (POS) system. Sibilia says that with the information and efficiencies POS systems provide, they pay for themselves in no time and afford you valuable advantages. “As you accumulate a database of customers, the system can provide you with a strategy called 30-60-90. This strategy dictates that if a customer hasn’t ordered from you within these amounts of days, it’s time to give them a little nudge. So if a customer’s name pops up on any of these days, you should be prepared to send out a customized message. By addressing these customers by name and knowing their history, you can be as specific as you want—and the more specific you are, the better the connection. A ‘We miss you’ card with a great offer works best.
Statistics show that the marketing costs of gaining a new customer run well over $100, yet some operators refuse to spend $1 to keep a current customer. But, by using the above strategy, you’ll have a good chance of keeping a customer with three consecutive mailings. If you don’t get them back after the effort, then at least you’ve tried. An additional benefit of a POS system is that personal information can be stored for each individual customer, and sending a birthday, mother’s day or anniversary card goes a long way to solidify a relationship.”
Consumer Lists/Business Lists. Sibilia explains that these are usually used to target businesses or specific groups during specific times of the year. This can be a sound strategy for increasing your lunch and/or catering volumes and should be used to target specific groups prior to important days or events—for example, targeting corporations prior to the holiday season or targeting local football clubs prior to a big game. You can purchase these lists based on a number of criteria, which makes this option viable and cost-effective, with the added potential of receiving larger catering orders.
New Movers. A must-use strategy! You can employ a new mover strategy in several ways. You can use services (such as those offered by Perkasie, Pennsylvania-based Moving Targets, www.movingtargets.com) that have everything automated for you, or you can have postcards and gift certificates printed yourself. You can work with real estate agents and agencies and negotiate the sharing of addresses where new homeowners have moved; tell the agencies that you will include a “Welcome home—compliments of [agency/agent’s name] and [your pizzeria name]” on the cards. A new mover program, which is offered by a number of companies in our industry, is a no-brainer; it’s not expensive, and the return on your investment can be dramatic. This gives you an opportunity to say hello to your new neighbors and, as some of these cases show, can translate to a big windfall for you in the long run.
If you plan to send to specific addressees—for example, customers who are in your POS database—inquire about having nondeliverable pieces returned to you so that you can purge your list of bad addresses; you’ll increase your chances of responses per piece in your next mailing. Consider using list brokers to help you purchase lists that will meet your needs. If you maintain your own list, keep it updated and remove any returned addresses. Mailing lists that are older than 18 months may have as much as 30% inaccurate content.
You can take several steps to keep direct mail costs at a minimum and improve your list: Sort the list using one or more criteria, and eliminate duplicate entries or addresses. You can sort by name, eliminating repeats, or sort by phone number (one customer may order from a home phone number and from work with a cell phone number, so if you send mail to both addresses, you send the same offer to one person twice). Always send to a specific person rather than simply blanketing an area, unless this is your goal (i.e., to launch in a new area).
Mining Your Customer List
Use your POS system to help determine the most effective offer for each customer. For a set of customers who order family feasts, market package deals designed for larger groups. Or separate the customers who order wings once a week, and direct mail them offers for new wing flavors, or mail an offer for a wing deal to everyone who has ordered wings within the past 30 days.
You can mine your database to improve direct mail responses in many different ways. One of the more successful ways, which has been demonstrated by many pizzerias featured in PMQ, is the popular 30-60-90 Lost and Lazy Customer program. Sort out customers who haven’t ordered from you in 30 (lazy), 60 or 90 days (lost). Each group is different, so you need to offer a different incentive to each one. Customers who haven’t ordered in 30 days may simply need a reminder. Maybe they haven’t thought about eating pizza in a while, so a “We miss you” card and/or a menu will work. Customers who haven’t ordered in 60 days may have discovered a new pizzeria or were dissatisfied with their last orders and need a stronger incentive to return; they may need a card with an offer such as a buy one/get one free or half-off deal. Customers who haven’t ordered in 90 days need the strongest incentive to return. They may need a free pizza to remind them of what your food tastes like or to try a new sauce, dough or specialty pizza. By knowing your customer, you’ll avoid giving away food and discounts to those who don’t really need it to come back, or wasting a menu on someone who needs a strong offer to come back.
Personalize the label. Many pizza shops provide lists to mailing businesses and have labels applied with addresses printed in basic fonts. This may save time and a little money, but extra effort here can increase your chances of success. Labels say “direct mail” and are more likely to end up in the trash. Instead, you could use a scripted font and blue ink so that, at a glance, the label looks more like it was handwritten. If you are mailing small batches, actually handwriting the addresses is best.
Choose metered mail or stamps. You’ll find a lot of debate about this subject. Some direct mail experts say that using stamps on direct mail increases the response rates. You may have even heard that simply placing the stamp slightly crookedly works even better. Overall, your choice depends on the type of direct mail you are sending. If you’re sending small batches of personalized letters, perhaps by pulling a list of large catering orders from your POS, then using stamps and handwriting addresses will increase the percentage of letters opened.
Match your message to your audience. Different people need different offers, so effectively employ direct mail by looking at the areas where you send and trying to identify who those targets are and what offer they would best respond to. For example, in a college town, you can find certain areas where college kids cluster. Chances are that they’re looking for discounts and late-night delivery options, so send out these types of offers. Look through your POS database; pinpoint where the big feast orders are coming from, and try to identify family-oriented areas. A little database mining can go a long way toward increasing the effectiveness of a mail drop.
Do more selling. When designing a direct mail piece, you may want to drop in some credentials by saying “PMQ Pizzeria has been in the same location for more than 30 years,” but you can use this space more effectively by selling more instead of telling more. Simply changing the statement to “PMQ Pizzeria has been making Oxford’s tastiest pizzas and pastas since 1975” makes your direct mail sell more rather than just tell more.
Give a call-to-action statement. OK, so you have the tantalizing photos of food; you have a selling statement about your shop; you have an appealing mailing label with a blue scripted font; and you’ve targeted specific areas with specific offers—so what else can you do? Give a call-to-action statement, such as “Order online NOW!” or “Call us at 555-1111 now, and we’ll have your pizza ready in 10 minutes!” or “Check out our online deals at www.pmq.com.” Be sure to include an “Act now, before it’s too late” statement.
Don’t forget the expiration. I have heard the story too many times: A pizza shop owner attached a coupon to a menu or a direct mail piece that was sent out three years ago; the response was so good that it blew the doors out. But it was a one-time special, and three years later the shop still gets calls about it. You guessed it—they didn’t put an expiration date on the offer. Expiration dates (including the day, month and year) help in several ways: They keep you from irritating customers who think the offer is still valid; you create a sense of urgency with a deadline; and you don’t have to honor a three-year-old deal when your costs have risen.
Consider guarantees and contact information. One of the best ways to get customers to try something new? Remove the risk. What if they don’t like your new item? What if they always order the same thing? What if they normally order from another pizzeria and really like it there? Get them to try your food by making the offer that if they don’t like the pizza/item, they can bring back any uneaten portion for a full refund. You subconsciously eliminate the risk to the customer. Sure, one or two customers may want their money back, but the amount of new business will offset these. Also, don’t forget to include all of your contact information: address, website, phone number and any special contacts for catering orders.
Plan for arrival. Details determine the success of a direct mail campaign, and knowing when your offers should arrive is a key component. Note when government pay cycles occur. Many jobs pay employees every two weeks, and the weekends that follow these pay cycles are known as power weekends. Have direct mail arrive the weeks they get paid, rather than the off weeks. Certain days work better, too: While Mondays are slow days in the restaurant business, they are also the heaviest mail delivery days. If your offer arrives Monday, it may get lost in the clutter. A better day to target is Tuesday, which is the lightest mail day. Wednesday is also a light mail day, just behind Tuesday. Targeting one of these two days on the week when employees get paid will help ensure success.