Direct Mail Still Leads in ROI by a Wide Margin

When it comes to direct marketing media strategies, email remains king among advertisers while social media is gaining ground and running a close second, according to a new ANA study.

The study, Response Rate Report 2021: Performance and Cost Metrics Across Direct Media, revealed that email was the most used medium in all campaign types (B2B, B2C, and split B2B/B2C), averaging an 82 percent usage rate among respondents. Social media came in second at 74 percent.

Beyond email and social media, the report included overall findings for paid search (51 percent), digital display advertising (42 percent), direct mail (38 percent), and SMS (18 percent).

Although email was the top media choice chosen by marketers, its usage has declined 6 percent since the last Response Rate Report was issued in 2018 while social media advertising scored the most significant shift in reported usage, up 17 percent since the last study.

ROI OF CAMPAIGNS BY MEDIUM

In terms of ROI, survey respondents indicated that while they certainly make use of modern technology in their direct marketing efforts, traditional methods such as sending messages in a letter-sized envelope via the U.S. Post Office can be remarkably effective. Those who did so reported a 112 percent ROI, followed closely by SMS at 102 percent and email at 93 percent.

The mail format that produced the best ROI to “house” lists was postcards (92 percent). The mail format that produced the best ROI to “prospect” lists was letter-sized envelopes (112 percent), the highest of all formats. Other notable formats to prospect lists include dimensional and oversized envelopes, both of which eclipsed 90 percent ROI.

“This important study demonstrates that traditional forms of direct marketing continue to be powerful engines for accelerating brand growth,” said ANA CEO Bob Liodice. “The findings will help marketers plan and optimize their marketing mix and drive sustainable long-term growth.”

FUTURE PLANS

Survey respondents also said that overall, they plan to increase their use of email (53 percent), paid search (52 percent), social media (50 percent), and SMS (50 percent) over the next 12 months. Of all media types covered, marketers said they were least likely to anticipate that social media usage would decline.

SURVEY SAMPLE OVERVIEW

• B2C campaigns were the most frequent type (42 percent), followed by B2C (31 percent) and split campaigns (27 percent).
  Marketers comprised 65 percent of respondents, followed by other (15 percent), suppliers of marketing services (11 percent), and agencies (10 percent).
• The largest industry segment in the survey was technology and communications (23 percent), followed by B2B products and services (20 percent) and health care (10 percent).
• Most respondents came from small companies with annual revenues of $25 million or less (56 percent), 24 percent came from medium-sized companies (between $26 and $500 million in annual revenue), and 20 percent came from large companies (over $500 million in annual revenue).
• Sixty-five percent of respondents reported revenue growth at their organizations in the most recently completed fiscal year.

The study was conducted by the ANA’s Data and Analytics Practice. This unit is critical to help members improve their personal and organizational acumen and to build capabilities to become a data-inspired marketing force.