How to Determine the Cost of a Direct Mail Campaign

Direct mail campaigns can be expensive and the payback expectation is minimal. However, with the right message and target audience, these campaigns can generate significant rewards. Before undertaking this campaign, consider all costs generally associated with this marketing endeavor.

Difficulty: Moderately Easy

Instructions

1. If you are lucky enough to have a marketing budget, determine the dollar amount to use for a direct mail campaign.

2. Determine your target audience. This will help you decide the number of leads you will need to buy. Your targets are usually segmented by demographics such as location, size, annual revenue and industry. You can request list estimates from a variety of lead generating companies.

3. You will need to design and write the direct mail piece. If you are lucky enough to have a competent individual on staff, your costs are minimal. Utilizing an outside firm can become expensive.

4. Art or photography will cost extra if not created in-house. However, for those companies that design and copy internally, there is an abundance of websites that offer free art or art at a minimal price.

5. Printing is a significant cost in direct mailing. Cost can be kept to a minimum with bulk rates. If you are using an outside printing company, request fulfillment and postage as part of the package. This generally lowers the cost per piece and will save time during processing. If this option isn’t available, you will need to calculate postage and fulfillment in addition to the printing costs.

6. All items mentioned above can be estimated or quoted. Once you have these figures, compare it to the budget set-aside. If you are over your budget, consider a narrower target market.

Tips & Warnings

• Compare the cost of a direct mail campaign to that of other marketing efforts with similar results. Determine which campaign will produce the most result with the same amount of resources.