What kind of pricing have YOU gotten with direct mail campaigns?

Question

I have been pricing out different companies to eventually do our direct mail campaign. For about 18,000 addresses it ends up being anywhere between $7,000 to $22,000....but I have spoken with people who did it for much less, in the same area...but they refuse to give me their source:/ Either they are lying or I am just not good at finding the right company.

Answer 1

You may be going about it the wrong way. The first thing you have to consider is that direct mail is an expensive way of doing business. It will cost you -- creative, printing, lists,  letter shop, postage-- approx. $1,000.00/M. That's $10.00 a name. Why so much? There's a lot of labor involved. As you mail more, the cost per name goes down. Now you have to consider that sad fact that you will get at the very very best response, which happens once in a blue moon, three percent AT MOST. That's 3 people out of every 100 mailed who may answer you. These 3 people will have to pay for the other 97. That means you have to get -- before working in profit -- $333.33 from each customer -- and that doesn't take into account the cost of the product to you, let alone the ancillary expenses of getting product to customer(everything from labor to taxes to insurance to debt service)!

Of course, all of the above is predicated on the supposition that you are in the mail order business, or catalog, or book club, or fund-raising, etc. . However, if you just intend to use direct mail as a general advertising medium (more properly, a sales promotion tool) without looking for a direct response, this little exercise has no bearing.

Anyway if 18,000 names is your total universe, you are talking about a very very small busines -- unless, of course, you are selling $2 million Morgan yachts! However, if 18,000 names is just a test sampling of a much larger universe, you might consider doing a smaller test. Cut your mailing to one third. If the response holds up to expectations then grow your mailings incrementally, observing the response at every step of the way. If you find the mailing is a dud, you will have lost only 1/3 of your intended total direct mail budget,and you can go on to other things..

Answer 2

When you price out direct mail services, make sure to get everything in writing. Different companies will charge you a different fee depending on the total scope of the project.

If you are simply buying a mailing list and asking the DM company to handle your mailing, then $22,000 sounds quite high.

If you are purchasing a targeted mailing list of 18,000 names for $7,000, that could be quite fair, depending on the mailing list. The more detailed the list, the more expensive it will be. For example, a list of 18,000 names could be just a few hundred dollars. But if you wanted a list of 18,000 names of registered democrats who are left handed and owned Boston Terriers, that would be more expensive to purchase, simply based on the exactness of your parameters.

If you would like some help with this, please e-mail me. I have considerable experience with direct mail and might be able to help you get your costs down and/or recommend direct mail companies to work with.