Cost of Direct Mail Advertising
But in today’s Internet-driven, eco-conscious world, there are better alternatives to direct mail. In fact, by today’s standards, it’s actually expensive to start a direct mail campaign. So how much does direct mail advertising actually cost?
On this page, we’ll answer that question and compare direct mail advertising to some reasonable alternatives.
First, let’s break down the cost of direct mail.
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How much does direct mail advertising cost?
Direct mail — also called “junk mail” by those who dislike it — was once an effective way for companies to reach local customers.
Direct mail operates off of public addresses, which are kept by every municipal government in the United States. Marketing companies collect those addresses into mailing lists and then sell the mailing lists to businesses.
Those same marketing companies could also contract with local businesses to send mail on their behalf.
Regardless of how they do it, we broke down the cost of direct mail in the table below.
Direct mail marketing breaks down to four basic steps — setup process, setup cost, cost of media, and cost to continue.
1. Setup process
First, the setup process is graphic design. By that, we mean that you write the text and create the imagery of your direct mail ad before it goes on the actual paper. You can do so through your company, a freelancer, or even yourself, if you’ve got the design chops!
But it’s important to acknowledge that your time is valuable. If you invest in direct mail marketing, you need to be sure that it’ll pay off in the long run.
In addition to money and time, direct mail comes with another cost consideration — your reputation.
We’ll level with you on this one. Direct mail is better known as “junk mail.” It’s frequently thrown away, and the number of people who even open your envelope will be a fraction of your total mailing list.
Regardless of what you offer, some people just don’t want unsolicited mail. It’s kind of like telemarketing through the postal service. So for every piece of unwanted mail you send, you could harm your reputation.
But if you’re okay with taking that risk, your next step in direct mail is setup cost.
2. Setup cost
Setup cost refers to paying a direct mail provider for their mailing list(s) and services. Both the lists and services depend on who you want to reach, how much mail you want to send, and what you want to achieve overall. With that in mind, direct mail setup costs can range from $50 to $7200, depending on your criteria.
That’s often a flat rate with most direct mail providers, but it’s possible your costs will recur on a monthly, quarterly, or yearly basis.
If that’s the case, you can expect your direct mail cost to be significantly more than we estimated above.
That’s still only about half the total cost of direct mail, though. You also need to consider the cost of supplies.
3. Cost of media
In this context, “media” refers to paper, envelopes, stamps, ink, and dozens of other little supplies that make direct mail possible. Your direct mail provider will often sell these supplies as a package with their mailing services. In that scenario, you can expect to pay $51.40 on average for a batch of supplies.
Compared to the setup cost for direct mail, this isn’t that much of an increase to your overall bill. Still, if you expect to run multiple campaigns with different designs, mailing lists, and supplies, you can multiply all of these costs by two, three, or more to get your final price.
In other words, running multiple campaigns could theoretically rack up more than $22,000 over the course of a year — maybe even more, depending on your goals!
However, there are still some costs you have to consider with direct mail. And the last one is major.
4. Cost to continue
Direct mail providers often require a cost to continue, kind of like a subscription fee, so if you plan to run multiple campaigns (or a single campaign for a long time), you can expect to add more fees on top of what you’re already paying.
These costs come from redesigns, reprints, resupplies, and more. Plus, most direct mail services throw an extra fee on top of that just to continue working with them — kind of like a landlord increasing your rent after you’ve lived in an apartment for a year.
That means your direct mail costs could increase year over year, but your net returns could be stagnant. That decreases your ROI, which makes it harder to justify a direct mail strategy in the long run.
And if direct mail can’t deliver a consistent ROI, it’s not an ideal strategy for your business.
Alternatives to direct mail marketing
Direct mail marketing is basically local marketing, but there are much better ways to get local customers. Thanks to the Internet, every business now has access to low-cost, high-ROI marketing strategies that deliver dependable results.
Below are just a handful of direct mail marketing alternatives that companies can use for local marketing:
- Local search engine optimization
- Web design
- Web development
- Pay-per-click advertising
- Social media marketing
- Google My Business
No matter how you spin it, all of the above marketing strategies let you promote your business for less money than direct mail — and often less time, too. In fact, given the possible long-term results, all of the above strategies will work better for you than direct mail.
That’s because the Internet makes it easy for businesses to market how they want. You can connect with service providers, design ads yourself, and simply add your business information to different directories to get new customers.
While those things take time and money just like direct mail, they don’t require such a high level of investment with such a low level of response.
Some of these local Internet marketing ideas are even free, like Google My Business. That means even if you just get one new customer from your Google My Business account, you’ve made pure profit.
Most of these online strategies are also designed to promote your business for far longer than direct mail.
With direct mail, you only get one quick blast out to your potential customers per payment.
That means you’re not just getting a one-time deal, like you do with direct mail. Instead, you’re investing in the long-term future of your company, and with it, daily potential to earn more revenue.
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At WebFX, we have a full team of Internet marketers who understand direct mail and all of its alternatives.
We specialize in Internet marketing strategies that you can use for a fraction of the cost of direct mail and significantly better ROI.
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