There is no question that targeted, one-to-one direct marketing works when planned and executed properly. Response rates, revenue per sale and customer loyalty can all increase. So how do you know you’re executing a one-to-one campaign properly? Start by taking critical components of your campaign, such as creative, marketing message and database, and test them. This is what one financial institution did, and it reaped long-term benefits.
Alerus Financial, a North Dakota banking institution, wanted to boost new loan applications. It also wanted to answer two critical questions: Would varying the imagery by age demographic make its marketing more effective? Was the cost of tracking results worth the expense?
To answer these questions, Alerus created a one-to-one direct mail campaign, broken into three age demographics—25 to 35, 36 to 45, and 46 to 55—and varied the imagery on each to best appeal to each demographic group. It combined this demographic segmentation with personalized messaging and used personalized URLs (PURLs) and trackable 800 numbers to measure response. At the same time, a static mailer that used the same creative as the targeted one was sent. Only a single toll-free number was used for responses. The offer was the same for the static and variable segments.
For its static campaign, Alerus received a response rate of less than 1%. The response rate for the targeted, one-to-one campaigns was 3.67%. Now it knew that varying the imagery by age demographic worked.
By tracking results, it learned something else. It learned that the 25-to-35 age demographic was 23% more likely than the 36-to-45 age demographic and 51% more likely than the 46-to-55 age demographic to respond to this type of offer. When it comes to planning for future campaigns, this knowledge is invaluable. The cost of measuring results paid off.
The take away? Testing is worth the effort. Marketers looking to boost their results with targeted, one-to-one tactics should test all aspects of their campaigns. Test the message. Test the images. Test the incentive. Test the database. In many cases, it doesn’t cost more to do this testing—it just takes time and willingness. Yes, there is an additional cost for results measurement, but you should be doing that anyway. And the benefits can be more than worth it.