Average Direct Mail Response Rate – You Might Be Surprised

Average Response Rate

I’ll cut to the chase. The average direct mail response rate is 2.5%. Surprised? Most business owners are when they hear this. Direct mail response rates vary between 1% and 3%. Very rarely is 4% or 5% attained and should never be expected. So, if you’re considering mailing to only a few hundred prospects, don’t bother. It won’t be worth the effort or expense. For example, if you only mail, say, 300 pieces, you will only receive 1-3 responses on average.

Average Closing Sales Percentage

Now it’s time to consider your average closing sale percentage. Say you achieve the 3% response rate of 3 prospects with your direct mail campaign. Now, you have to sell them your product/service. What is your average closing sale percentage? 33 percent? 50 percent? Lower? If you only receive a 1% response rate and your closing percentage is only 33%, you have a 1 in 3 chance of making a single sale. Not very good odds. I wouldn’t gamble the success of my business on those odds. Would you?

Minimum Number of Pieces

When considering a direct mail campaign, I wouldn’t recommend sending any less than 1,000 pieces. With 1,000 pieces you can expect 10-30 responses. If you receive the average 20 responses and have a closing rate of 33% you should make a minimum of 6 sales. If you have a closing sale rate of 50%, you should make a minimum of 10 sales.

If you are willing, I would recommend mailing anywhere from 5,000 to 10,000 pieces. Sure, it’s a hefty investment up front, but should bring a nice return on your investment with response rates varying from 50-150 per 5,000 and 100-300 per 10,000. With a closing sale percentage of 50%, you will attain anywhere from 25 to 150 new customers. Not too shabby. Turn those new customers into repeat business and you’re doing even better. But, that’s a topic for another time.

Target Market

Another important aspect to keep in mind with direct mail is making sure you are mailing to your “target market.” Unsure of who your target market is? In a nutshell, your target market is those who are most likely to buy from you. Not sure who is most likely to buy from you? Here are a few questions to get you started:

• Are your target customers male or female?

• What is their age?

• Where do they live?

• What is their occupation?

• What is their average annual income? This is important when considering the price of the product/service you are selling. You wouldn’t want to market a luxury item to someone who can’t afford to purchase it.

• If selling items for homes, you want to market specifically to homeowners.

Remember, you are in business to make a profit. A direct mail campaign is a very effective way to attract new clientele so long as it is utilized effectively in order to receive a positive return on your investment.

Comments are closed.