I assume by the volume of junk mail I receive that it works as an advertising method. The smart advertising people these companies hire have all kind of nifty charts and stuff that show definitively their scheme of stuffing our boxes provides more income than it costs to print, right?
But I don’t know a single person who admits to giving junk mail a second glance before it reaches its garbage destination, I certainly don’t. I’ve observed from my PO box as the masses act out the all too familiar ritual of grabbing their real mail, walking over to the trash, and filling the can with enough paper to bring environmentalists and janitors alike to tears. So what am I missing?
Is it-
The printing and mailing of this stuff is cheap enough to warrant annoying us to death in hopes that our subconscious registers their big flashy logos?
Enough people look for coupons that they are bound to see and contemplate the 90% of junk mail without coupons?
There actually is a hidden significant segment of people who make their shopping decisions with shiny paper that strangers rudely jammed into their receptacles?
In 1991 or so, my job included fund raising for the Friends of the Library. We put together a mailing of everybody on our books who had ever been a member and reminded them that their membership had lapsed. I don’t remember the actual numbers, but our response rate (the number of people who actually responded by sending money in) was somewhere around 1/3.
Then we sent out a blind mailing (people we had no prior relationship with) to everyone* who had a library card. The response rate was closer to 1/10.
But the break-even point for printing and postage was somewhere around 1/20 for each mailing, so relatively speaking we made a killing.
*Not actually. It was something like everyone over 18 who had used their library card in the last 18 months who wasn’t already a member and hadn’t been sent the prior mailing.
I don’t doubt that bulk mailing works as I said. I’m concerned with the how.
However, I don’t consider your example as junk mail. You were contacting individuals with specific information relevant to them. I’m taling about the huge tacky ads that you know is junk at first glance and is not the slightest bit personalized.
It depends if you’re in the market for something. Usually I throw that kind of stuff away without a second glance. But a few months ago I wanted my carpets cleaned, and I looked through the pile of ads hoping to find an ad for a carpet cleaner offering a discount. And so I did.
Same reason SPAM works (although the price/benefit break-even point is probably orders of magnitude more extreme in the case of SPAM). The fliers are dirt-cheap to produce, getting them in your mailbox is cheap, and those few people that do read and make use of the fliers provide more profit than the cost required to get them to the majority of people that pitch them.
It works because the response rates are sufficient to cover the costs of generating the junk mail. Just because you toss junk mail away does not mean everyone does. If everyone tosses junk mail then it will disappear.
Even as a consumer who also recycles most of my bulk/ junk mail, I know it works. I usually look at the grocery ads, and the other stuff is tucked in there so I see it in passing. Then when my husband and I decided to redo our windows, we knew where to look and had already “heard” of certain companies, by virtue of having seen their names in passing once a week as their flyers were tossed into the recycling bin.
Is it possible that after 18 years you’re not remembering those ratios correctly?
Frankly, your numbers strike me as implausibly high, based on my experience of doing direct mail solicitations for my newsletter for more than a decade, and based on all that I’ve heard about DM at conferences over the years from people to do a lot more of it than I do. If you had added “of one percent” to each of those fractions, I would have been much less incredulous.
Of course, maybe your community really loves its library.
But to the OP’s question, if you send out mail to enough people, the cost per piece goes down and the response needed to break even can be very small. Direct mail advertisers expect, and typically receive, a small percentage response to each mailing – it can be less than one percent – and budget the mailings accordingly.
As others have said, if nobody responded, they wouldn’t keep doing it.
Not to put words in KneadToKnow’s mouth, but I think that the difference comes from targeted bulk mailing versus the generic, blind approach - the 1/3 number was from people who had already been members of “Friends of the Library” which makes them a pretty good target. It wouldn’t surprise me, though, if blind mailings were about as effective as dry humping.
Anything’s possible. But in this instance, I think I’m remembering pretty clearly.
I had a large ownership stake in the project, as I came up with the idea, came up with the criteria for the list myself, printed the mailing labels, applied them to mailers, wrote the text of the fund-raising letter, took the flats of bulk mail to the post office, and had half of my salary paid by the Friends group I was raising money for. I got commended by my boss, by the public relations director of the library, by the executive director of the library, and the entire board of directors of the Friends of the Library for my effort.
It was kind of a big deal, because our receipts that year were around four times what they had been in any previous single year.
It sort of left an impression.
Keep in mind, I wasn’t selling air conditioners to Eskimos. I was promoting contributing to the library to people who either had done so in the past or had recently used the library. Even the “blind” mailing was pretty narrowly targeted.
Keep in mind that with direct mail, there’s no such thing as a truly “blind” mailing. You’re on their mailing list for SOME reason – you live in the right neighborhood, you have a library card, you own a credit card, whatever. Someone thinks you’re in the target audience.
IANA direct marketer, but when I worked in advertising, a “successful” response was generally 1-3%. The breakeven rate was even lower.
We need a 1% response rate – that’s it! … and 4% will blow away our expectations/minds (happens from time to time).
Banks that went the mass-mailing pre-approved route in the 80’s and 90’s became the biggest credit card companies and remain viable today. I am in the credit industry, and I can tell you that most people have established credit as a result of ‘junk mail’.
Pre-approved offers have dried up, because they are costly up-front investments, but I know that, as a result, many companies have slowed their growth – temporarily and deliberately. When banks and CC companies want to grow again soon, watch your mailbox activity ramp up.
Totally agree with this. I now work in branding, but have previously worked in both advertising and direct mail. I did a significant amount of direct mail work for banks and finance companies - the people flogging you loans. A 2% response was deemed to be a successful (i.e. money-making) response. I once did a DM campaign for car finance that got a 13% response - my client virtually gave me a knighthood.
2% might not sound much, but it’s a lot if your mailing is in the multi-million region.
You and KneadToKnow make good points. My experience is on the commercial side, and the library is presumably non-profit, which changes the picture. Also, KTK didn’t say how much she was asking for, but I’m guessing that if the break-even point was 5%, it must have been pretty low.
How many pieces did you send in each of these mailings, and what were you asking for, KneadtKnow?