Success in Direct Marketing is very easy to define and caculate. However, many unsophisticated companies, especially in the small to mid-size business (SMB) community, don't take advantage of the inherent tracking and analytical capabilities direct marketing provides.
Historically, SMBs use local advertising vehicles (that were geographically, but not prospect/customer defined) such as:
Failing to test concepts before committing significant advertising dollars ignores direct marketing's major advantage. We can take a small sample and test the concept before committing greater financial resources. Assuming the initial test was successful, we can replicate the same test parameters and have a high confidence of success.
A response rate is not the single measure of success. Response rate are affected by the cost of the product/service. Generally as your cost of service/product increases, response rates decrease. A "lower" response rate does not automatically translate into an unprofitable campaign. A profitable marketing program is one that has a positive return on investment (ROI). This metric ranks the "success" of any marketing program regardless of media deployed because it calculates the promotional cost and COG to determine profitability. ROI normalizes analysis by providing a metric useful for any marketing campaign.
The list or media you use is the single most important aspect of any direct marketing (on or off line) program. It accounts for approximately 40% of the program's success. The second most important component is your offer (another 40%).If you target incorrectly, you can have the best offer in the world and it will not make any difference.
