Marketers can derive more value from their CRMs and other offline databases—the ones they use, or previously used, to power direct mail campaigns—to fuel a more modern tactic: programmatic advertising targeted to specific households using geofencing, or “addressable programmatic.”
By 2020, almost 90% of all mobile display ads and 86.2% of all digital display ads will be bought via automated channels, according to eMarketer. Programmatic is the future of advertising. While direct mail has been used for decades, it is rooted in valuable data that includes customers’ and prospects’ mailing addresses, purchase history and behaviors and preferences that help marketers determine how likely someone is to be in-market for a particular product or service.
Today, marketers can leverage the same data they use for direct mail to create highly effective digital advertising campaigns, including a tactic called addressable geo-fencing. Addressable geo-fencing uses GPS data rather than IP addresses to target specific locations, such as individual households. Advertisers can target digital ads to prospects from their databases to support direct mail initiatives, or as a standalone initiative. These digital campaigns are typically a fraction of the cost of direct mail and can be a cost-effective way to leverage valuable data.
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While total mail volume declined by 29.85% from 2006 to 2017, direct mail marketing is still alive and well. In fact, direct mail response rates are on the rise, according to DMA’s 2018 Statistical Fact Book. Advertisers can use digital tactics to bolster—not necessarily replace—their direct mail campaigns. Let’s consider a few examples:
- An auto dealership is running a direct mail campaign targeting people whose leases are up for renewal. The dealership can complement the campaign by using addressable geo-fencing to serve those same households targeted ads on their desktops, laptops or mobile devices.
- A plumbing company is running a direct mail campaign targeting households in its database with hot water heaters that are at least nine years old. It can supplement these efforts with a digital campaign targeting the same prospects.
- A credit bureau invests in direct mail to target households that are shopping online for car loans. The credit bureau can bolster this campaign by serving these same households digital ads using addressable geo-fencing.
In all of these examples, marketers are creating multiple touchpoints for their brand. Consumers who see digital ads before the mailer will be primed for the message, and those who see it second will be reminded of the offer you are trying to reinforce.
Digital-only advertisers can also leverage the data in their offline databases to improve their targeting and messaging. Research shows that targeted advertising is more likely to generate results than non-targeted advertising. For example, a survey by the Network Advertising Initiative (NAI) showed that consumers who click on ads targeted specifically to them are more than twice as likely to buy the product that is being advertised. Consumers also prefer ads that are customized based on their behavior and preferences and are more likely to engage with these messages than generic ads. By using data in their offline databases to power programmatic advertising, marketers can improve their targeting and personalization strategies, and in turn, drive better results.
Using digital tactics to improve offline measurement and attribution
Coupling direct mail advertising with digital marketing can also improve your approach to measurement and attribution. Whereas it is impossible to measure how many prospects opened your mailer with certainty, it is relatively simple to track how many people clicked on a digital ad or visited your website at a later time. These digital metrics will help you determine which households are most interested in your marketing message and focus your subsequent marketing efforts. For example, you could invest in a second direct mailer targeting households that engaged with your digital ads, and/or in subsequent digital advertising to drive home your message and increase conversion rates.
Marketers who are trying to drive foot traffic to a particular location can use geo-fencing technology to more precisely measure the effectiveness of their efforts. Let’s revisit the auto dealership example. To better gauge the advertising’s effectiveness, the dealership can track conversions based on the use of geo-fencing technology that incorporates conversion zones and tracks the percentage of people who received the mailer and/or digital ads, and then went on to visit the dealership.
Many marketers are sitting on a goldmine of data. Whether you are a direct mail proponent or not, you can use the same data that fuels these types of campaigns to unlock a whole new era of advertising. The coupling of this data and technology will improve your programmatic targeting, either as a tactic for bolstering your direct mail campaigns or as a standalone strategy.