Is Direct Mail Obsolete?

May 21st, 2007 by Bob Bly

I’ve been raked over the coals by blogging evangelists and branding consultants all over the Internet.

They call me a “dinosaur” because I am a direct mail guy — derisively referring to direct marketing as “intrusion marketing,” implying it is old hat and ineffective, and stating that blogging, branding, and the like are what’s in and what’s working in B2B marketing today.

Not so, according to an article in BtoB (5/7/07, p. 3.), which notes that 42.9% of B2B marketers’ total budgets go to direct marketing — while only 16.1% is allocated to brand advertising.

Within direct response, direct mail receives the largest budget share — 27.5%.

The smallest share of total budget, a mere 1.5%, goes to “new media — RSS, blogs, and the like.”

Does this mean that branding and blogging don’t really work for B2B … or that they DO work, but B2B marcom managers haven’t gotten up to speed in these areas yet?

Are you surprised that B2B marketers spend more on good old-fashioned paper DM than they do on online marketing?

Could it be that B2B prospects are so bombarded online with blogs, e-mails, ads, and other Internet content, that a piece of paper in the mail breaks through the clutter?

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This entry was posted on Monday, May 21st, 2007 at 1:38 pm and is filed under Direct Marketing, General. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

42 responses about “Is Direct Mail Obsolete?”

  1. Dianna Huff said:

    Bob,

    Direct mail is not dead . . . nor are new media tactics worthless.

    If you read my blog, you’ll note I write posts about traditional marketing and how companies have used them to market to me.

    For example, I’m now a Carbonite (online backup) customer. I heard about Carbonite from a good old radio ad on talk radio.

    However, I heard about Skype from my husband . . . who heard about it from his colleague. He (my husband) then told his company about it.

    You have two very traditional tactics — word of mouth and radio — working very well.

    On the other hand, someone like David Meerman Scott is doing quite well because of his viral marketing activities — which are sheer genius. He would never be where he is if he had stuck to direct mail.

    I would also add that for B2B, corporate Websites and search are key in terms of marketing to other businesses. I’d put the bulk of my budget into my Website first — then use offline and online tactics to get people to the site where I could convert them into known prospects.

  2. Mike Smock said:

    Hi Bob,

    Direct mail is still our preferred method. We use all sorts of “Web 2.0 stuff” including blogs, SEO, RSS feeds, PPC, but for B2B, dealing with higher ticket sales – direct marketing works best. We just blogged about this issue:

    http://twoscenarios.typepad.com/maneuver_marketing_commun/2007/05/there_is_an_int.html

    Don’t know about you, but I’m getting a touch weary of the “new” marketers and their destructive engagement with anybody who disagrees…

  3. Duncan Morris said:

    > Could it be that B2B prospects are so bombarded online with blogs, e-mails, ads, and other Internet content, that a piece of paper in the mail breaks through the clutter?

    I think a decent bit of direct mail, with something about it has something about it. Recently I seem to be getting less and less “junk mail” and more and more “junk email”. Personally I am far more likely to read a direct mail piece than an email. I get enough “solicited” email to take up my day, so why would I bother with “un-solicited”

  4. Bob Bly said:

    DH: Who the HECK is David Meerman Scott? Never heard of him.

    MS: You are totally correct: the new marketers are not content to teach their methods; they want to prove that old methods are old hat, though that is clearly not the case. Not sure why they feel so militant and adversarial about the whole thing — but they do.

  5. Dianna Huff said:

    David Meerman Scott — author of the Web Ink Now blog. http://www.webinknow.com

    Has won two MarketingSherpa awards for viral campaigns. Wrote the book, “Cashing In with Content.” Also wrote the forthcoming book, “The New Rules of Marketing and PR.” To see his campaign in action, see his blog post: http://www.webinknow.com/2007/05/thank_you_for_h.html

    A number of bloggers posted in their blogs how thrilled they were to be in his book — and of course, spreading the word. He told me had a number of authors email him and say, “Now why didn’t I think of that?!”

    Genius.

  6. Hans De Keulenaer said:

    Branding can work for b2b, but requires unprecedented discipline from an entire organisation. I could see it working very well for example in markets where a large number of customers make spot purchasing decisions.

    Whether blogging works depends on why and how it’s being used. We’ve found blogging invaluable to promote a website, and meanwhile have fully integrated 6 blogs into it.

    It is not surprising that new media represent a relatively low part of marketing budgets – this may relate to their cost effectiveness rather than their weight in the mix. However, for new media, with all their metrics, little is known on their effect on sales generation.

  7. Bob Bly said:

    DH: As a direct marketer, I am unimpressed with awards, and impressed with sales results. “Cashing in With Content” is a great title, and makes me want to read the book. “The New Rules” has me skeptical, thinking this guy is another touchy feely new media guy who is going to try to make a buck and a reputation by saying none of the old stuff works and it’s all obsolete, even though he has no data to back that up.

  8. Dianna Huff said:

    Bob,

    Anne Holland at MarketingSherpa is data driven. The viral awards are based on data and results. Here is Scott’s campaign analysis: http://www.marketingsherpa.com/viralawards2007/4.html

    His Cashing In with Content is very good and includes (I think) 13 case studies, including B2B, of how companies used their Websites to generate leads and sales.

    You should also read “The New Influencers” by Paul Gillin. I gave it five stars at Amazon. Excellent, excellent book.

    Anyway, I don’t think B2B DM is obsolete, but judging by what arrives in my mailbox every day, companies need some *serious* help. 99% of it is junk I immediately throw away.

  9. Susan Martin said:

    My 2 cents:

    I guess it’s possible, but I still see direct mail as an intrusion. Similar to Dianna, I throw all DM in the recycling bin on the way back from the mailbox.

    However, I do still do recommend some traditional marketing methods to my clients (who are mostly small professional service firms) particularly around word of mouth or relationship marketing; rarely advertising or DM.

    Personally, I feel that direct mail is an annoyance, as is email marketing, particularly when it is spam, but even to some degree when it’s opt-in.

    The sheer volume of marketing communications coming into the average business via snail mail or email is a bit overwhelming.

    What’s exciting about some of the new media is that people are actively seeking something, so there most likely more targeted. When it works, they connect to a company or individual who can solve their problems. If what they’re reading makes sense or hits a chord with them, the connection is made without any intrusion.

    Question re statistics: You mention amount spent, but do you have any idea of what the return on investment figures are for DM vs. new media right now?

  10. Mike Smock said:

    Hi Susan, Can you share any campaigns you executed for small professional firms where “new media” increased revenues, margin or market share? Thanks.

  11. Kevin Hillstrom said:

    Bob — I say let the customer decide what works. If Direct Mail works, good. If Web 2.0 technology works, good. If they all interact in a positive way, great!! I spent my formative years analyzing catalog performance, now, I generate business by blogging. There’s a place for everything that’s done with honesty & integrity.

  12. Bob Bly said:

    DH, SM: with all due respect, the fact that you personally throw DM away is irrelevant. Enough people read and respond to it that DM is hugely profitable for countless companies — L.L. Bean is just one example. Do you think there is a reason they spend a huge chunk of their budget on catalogs and not blogs or new media?

  13. David Meerman Scott said:

    Hi Bob. It is good to “meet” you. Too bad I hadn’t seen your blog months ago because it is great.

    I certainly hope I’m not perceived as a touchy feely new media guy. The feedback I get from the 25 or so speaking engagements and seminars I do a year certainly wouldn’t indicate that.

    The background that I apply to marketing on the Web draws from 15 years in the online news business. I was Asia marketing director for the late, great Knight-Ridder and VP Marketing for Thomson’s NewsEdge business. I’ve found that adopting the online publishing models that I learned working in publishing businesses is what works in Web marketing and PR. I’ve found that it’s all about learning what buyers need and what problems a company solves for buyers and then creating content in the form of blogs, news releases, ebooks, content rich web sites that reaches buyers with information that they WANT to read. That’s the same approach that an online publisher uses to develop a content product that people want to consume.

    This market-driven approach is very different than what most companies do to develop marketing: Sit in a room and dream up one way broadcast “messages” about their flexible, scalable solutions that improve business process (or whatever). On the web people don’t want advertising, they want content that appeals to them. And they want stories drawn from people like them about what works.

    In my books, free ebooks, speeches and seminars I draw heavily on real-world examples from organizations of all kinds that are using web content successfully including companies large and small, nonprofits, political campaigns, even rock bands and churches. So my approach is certainly data driven. The organizations I write about have measurable results from their web marketing initiatives. Even if my readers don’t agree with me, they can’t argue with the evidence of success of the organizations that use this form of marketing.

    As you’ve pointed out, there is an issue with the title of my latest book “The New Rules of Marketing & PR: How to use news releases, blogs, podcasts, viral marketing & online media to reach your buyers directly” with professionals like yourself. Professionals say more or less what you have—that this stuff isn’t “new.” Good marketing and good writing has always been just that.

    But I do think that the Web opens up opportunities for organizations to tell their own stories on the web without the need for expensive advertising or trying to convince the media to say good things. Instead they go direct.

    And besides, my core market is not professionals like you (although my professional colleagues like Dianna and the 163 bloggers I mention in my book get a lot out of my books and my blog). Rather my core market is the traditional marketer and PR person in a company or a nonprofit, entrepreneurs who want to jump start a business, and agency people who want to understand what’s possible on the web. The title may not work for people in the know about blogs, and podcasts, and ebooks, and online news releases but it is a title that works for those who want to know about a world they may not understand yet.

    Interestingly my “New Rules of Marketing & PR” has sold 5,000 copies even before the book is out—more copies than “Cashing in with Content” has sold over its entire two-year life in print. Hmm… Maybe the title is pretty good.

    I would be more than happy to send you review copies of my books. Just shoot me an email with a mailing address.

    All the best to you.

    David

  14. Bob Bly said:

    I’ve been using content and PR-driven strategies such as you describe since the early 1980s. They work offline as well as online, though I agree that the Web has boosted the use and efficiency of content marketing. In my book The White Paper Marketing Handbook (Racom/Thomson), I call it “edu marketing” or educational marketing. My address is all over my site at http://www.bly.com and I’d love to swap review copies of books with you. Where can I send my books to you?

  15. David Meerman Scott said:

    Yes, this content focus certainly works offline too! Absolutely, let’s swap books. I’ll pop a few into the mail to you.

    Many thanks

  16. John Dumbrille said:

    Interruption is what all media are about. Otherwise it’s carry on as you were. Permission marketing is building momentum and direct mail can be carried out in a permission marketing model too.
    Cold calling still works anyway, it’s how you do it that changes. i guess permission marketing presumes people stay the same, and knew what they wanted in the first place.

  17. Fern said:

    Interesting post today, Bob! Comment to some of you writers: Please stop adding “2.0″ to the end of everything. It’s overused….

  18. Susan Martin said:

    Hi Mike,

    Re your question: In developing new media campaigns for small prof. service firms (with limited budgets) which yield a great ROI, I just use a coordinated combo of standand tactics that I’m sure you’re familiar with:

    1. Develop a traditional marketing platform (ideal client, pain points, solutions, niche / target market, differentiation, branding, positioning, etc.) Without this, the others won’t work…

    2. Content-rich website which clearly speaks to ideal client and their pain, offers solutions, and establishes credibility thru articles, white papers, testimonials, case studies etc., optimize for organic search engine results, frequently update with new content.

    3. Corresponding blog full of useful information and conversation of interest to those ideal clients, their pain, on topics relevant to the solutions they provide, also updated frequently. Supplemented with comments and trackbacks to relevant blogs.

    4. Article marketing campaign geared toward establishing expert status, linking back to specific, relevant, content rich pages of the website and or blog.

    5. Opt-in only email marketing campaign / content-rich e-zine that goes out once or twice a month with links to relevant pages of the site or posts on the blog, and to special offers, etc.

    6. Secure expert status, write columns / posts for highly relevant popular sites or blogs.

    7. Combine with live workshops, seminars, networking, relationship building etc.

    My clients increase revenues substantially (30 – 50%) without touching direct mail or advertising, for as little as 2-4K and some consistent sweat equity.

    Of course, the trick is to actually get them to follow-thru and do all of this, and that’s where my coaching services, support and accountability come into play…

  19. Susan Martin said:

    Dear Bob,

    I agree, my personal opinion on direct mail is irrelevant :-)), I wasn’t referring to catalogues, just mailings. As online shopping becomes more prevalent, do you see it continuing to be strong over the next 5-10 years?

  20. Bob Bly said:

    Susan: the model going forward seems to be: use direct mail and other methods to acquire a customer; capture her e-mail address early; then rely heavily on e-mail for CRM, supplemented by some snail mail for upselling and cross-selling. You would think it could be all electronic, but so far, no: people still like something physical in their hands. Someone could write a good white paper on WHY that is so.

  21. Bob Bly said:

    David Scott: while I agree with you about content-based marketing being effective, many others disagree with us. Their arguments include: “I am in business to SELL my products, not give away free content” and “the customer is already drowning in information on my topic which is available for free all over the Web.” What say you to these naysayers?

  22. Damian Petrini said:

    Timely topic Bob. I just read an article in the April 2007 issue of Technology & Learning magazine called “All Blogged Out?”

    The article sated that of the over 70 million blogs on the internet, only 15 million remain active blogs, while the rest of the blogs are left inactive.

    Technorati, a California based blog search engine, reported to Vallwag.com in April that the number of active blog sites has remained static in recent months.

    Most people create blogs, but then do not keep them up to date or get caught up with other things and forget about the blog.

    Although blogging sites can help create buzz about various products and services, I don’t see it putting much of a dent in the multi-billion dollar direct mail industry.

    The key for most businesses online and offline will be to do a combination of direct mail and blogging as a part of their overall marketing strategy, but they should also not overlook sales reps, telemarketing, email marketing (which if done right, is really direct mail online), joint ventures, press releases, advertising, referral generation, special events, trade shows, seminars, and the list goes on and on…

  23. David Meerman Scott said:

    Web content sells virtually any product. There are 50 examples in my new book and hundreds of others that come to mind.

    As a professional speaker and consultant, I have never, ever made a sales call and I turn down business every week (my guess is the same is true of you, Bob) all due to my online and offline content.

    http://www.ConcreteNetwork.com rises to number on on Google for the word “concrete” and drives nearly a million hits a month and a profitable business through online content about concrte (you can’t get more bricks and mortar than mortar).

    National Community Church http://theaterchurch.com/ does not even have a church building but has built a live community of over 1000 people and a virtual community of hundreds of thousands through video, blogs, podcasts, and other content.

    Robert Scoble carried around a $250 video camera, recorded what employees are working on and what they think of the products they built, and published those videos on the web building an audience of more than four million unique visitors a month and single handedly put a face onto Microsoft.

    Cervelo Cycles http://www.cervelo.com/ becomes a top brand for bike racers with no marketing department — success comes from web content

    You’re not supposed to be able to run a Presidential Campaign with just a blogger, a videographer, and a Flickr photographer. But that’s what John Edwards did in December 2006 as he announced he was running for President.

    I could go on and on…

  24. Bob Bly said:

    David: no one believes more in free content as a marketing tool than I do. But, the problem with the examples you cite is the sales are not measureable: you cannot trace a single dollar of Microsoft sales directly to what Scoble writes on his blog. When we direct marketers send out a mailer or e-mail, we can tell you the direct sales results down to the penny — no guessing, no vague talk about clicks or impressions or search engine rankings. Also, I don’t recall Edwards winning any presidential elections. :)

  25. SpongeBob Fan said:

    John Edwards may have announced his candidacy “with just a blogger, a videographer, and a Flickr photographer.” He’s certainly not running with just these 3. (Great thread, Bob & alll. Thanks!)

  26. Daniel Sitter said:

    I have been using a combination of techniques to reach potential customers, including direct mail. It remains a viable part of my marketing mix.

    From a personal standpoint Bob, it’s almost refreshing to receive a piece of quality direct mail once in a while because I get so little of it anymore! I tend to take a few moments looking it over. I hope my customers do likewise!

  27. Sheri Cyprus said:

    Good point, Bob, about direct marketing being so measurable.

  28. Jodi said:

    Direct mail is definitely not obsolete. In fact, I just answered a question on a TechCrunch forum from an e-mail marketer who was about to launch a postal direct marketing campaign.

    I think that postal marketing will continue to be relevant. LL Bean still sends me lots of catalogs in the mail. I’m actually a multi-channel customer. I look through the catalog, then when I’m ready to order I check online to see if what I want is still available, and finally call with questions and to place the order.

    Done correctly, email marketing, and other forms of internet marketing are also measurable, you just have to think like a direct marketer! And, of course, e-mail can give you information you can’t get with postal mail (such as open rates; it’s hard to tell how many people opened your envelope.

  29. Steve Peterson said:

    Direct Mail is very much a live and profitable. Who ever decided that EVERYONE who bought stuff was online? I know alot of consumers don’t spend their entire day is online like many of us.

    My lovely wife buys all sorts of products by means of direct marketing advertisement. The UPS and Federal Express trucks very regularly stop in front of my house with items that she has bought through direct marketing advertisement methods.

    Steve Peterson
    http://www.PetersonCopy.com
    http://www.HomeandFamily101.com

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    Direct mail is not dead, however it has allowed itself to become victim of increased postage and paper costs and environmental zealots as mailers are mailing too much waste.

    The good news is that new technologies like CognitiveDATA eliminate the vast majority of wasteful mail thus making it more efficient for direct mailers to promote.

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