When it comes to direct mail, measuring the success of your outbound efforts can feel like a messy, impossible task. After all, can you really quantify the value of a gesture of goodwill?
Reporting on marketing performance is never straightforward, and as with every other marketing initiative, it helps to have solid goals set up for what you want to achieve with your gifting strategy. And, there are lots of different goals that gifting can help you achieve, such as:
- Raising brand awareness
- Increasing pipeline
- Enhancing close rates
- Boosting deal velocity
- Driving customer renewals and referrals
Regardless of what your goals are, the metrics below will provide you with meaningful and actionable insight to help check if you’re on the right track with your strategy and show your campaign successes more clearly.
1. Response rate
As a direct mail performance metric, response rate refers to the number of people who have responded to your direct mail campaign. For BDRs or field marketers, this could be the number of prospects who have replied asking for more information to an email they’ve sent out containing a gift.
This metric is an important one to pay attention to because it provides an insight into the number of prospects who are taking an active interest in your product or service. It also demonstrates the success of using direct mail as an incentive for prospects to engage by showing which key accounts are talking to you post-touch.
Many factors can influence your response rate, including:
- The industry you’re in
- The seniority of your target audience if you’re in B2B
- The budget for your corporate gifts
- The quality of your initial first touch email
- If the gift your send is personalized to the recipient
To measure the overall response rate of your direct mail campaigns, simply divide the number of responses you receive from a specific campaign by the number of gifts sent. So, if you sent out 1000 boxes of cupcakes to prospects and you received 150 responses, your response rate would be 15%.
Pro Tip: Using a direct mail and corporate gifting tool like Reachdesk can help you to get 30% higher response rates.
2. Redemption rate
Redemption rates inform you about how many prospects, customers or employees are claiming the gifts you’re sending out to them. This metric helps you to track the success of your corporate gifting campaigns, as well as makes future campaign planning easier, as it acts as a predictor for the overall amount that your business is likely to spend on gifts.
If the overall redemption rates are low for your eGift campaign for example, this could indicate that the type of gift you’ve offered might not fit with the persona you’re targeting - perhaps a physical gift might work better. If they’re high, then prospects, employees or customers may be more engaged with the gifting campaign. However, irrespective of the results you achieve, the most important thing to remember is that your messaging should take precedence over the gift you’re sending, Relevancy, timeliness, and personalization are king, because the end goal of any campaign should be to build rapport and have meaningful conversations with prospects and customers, rather than guarantee a sale or upsell.
To calculate the redemption rate, divide the number of gifts redeemed by the number of gifts offered and multiply it by 100 to get your redeem rate percentage. Alternatively, you can head to the Insights tab within the Reachdesk dashboard and it’ll already be displayed for you:
3. Cost per conversion
The cost per conversion metric demonstrates how much it costs to convert a prospect into a customer using gifting. It’s also a great indicator of how your direct mail campaigns are performing.
If your cost per conversion is too high, it could mean that your direct mail campaign needs optimization - perhaps your BDRs aren’t targeting the right prospects or your B2B sales sequence needs work. Equally, if your cost per conversion is low, your BDRs are likely doing everything right!
To calculate the cost per conversion of a direct mail campaign, divide the total cost of the gifts sent by the number of prospects converted to customers. So, if the cost of the gifts sent was $10,000 and you gained 50 new customers, your cost per conversion would be $200.
4. ROI
Measuring the return on investment (ROI) of your direct mail campaign will help to show how effective it was overall and how much impact gifting has had on your business’s bottom line.
To find out the ROI of your campaign, take the revenue that was earned from it and then subtract the total cost of the campaign. Next, divide that number by the total cost of the campaign. Finally, take this number and divide it by the cost of the campaign and then multiply that by 100.
So, if your campaign yielded $40,000 in revenue and cost $20,000 to run, that would be $20,000. Dividing that number ($20,000) by the campaign cost ($20,00) and multiplying it by 100 leaves an ROI of 100% - go you!
Here at Reachdesk, we know the brilliant results that direct mail can yield. Recent studies show that direct mail receives an average of 112% ROI – the highest ROI across all mediums, followed by SMS (102%), email (93%), and paid search (88%). Yet some of our customers have experienced numbers as high as 384%! So, we’ve made it easy to track within our tool. If you’re a Salesforce user you can utilize the Influence tab within Reachdesk Insights to see the impact gifting has on your business’s net income. You can see how many opportunities direct mail influences and how much revenue it generates by team, campaign, and individual sender.
5. Cost per send
Calculating the average cost per gift send is a useful way to keep track of overall campaign spending and evaluate the value for money that you’re getting from direct mail and corporate gifting.
To work out the average cost per send, all you have to do is divide the total cost of gifts by the number of sends in your campaign. So, if the total cost of your gift sends is $6000, and you sent out 1000 gifts, then your total cost per send would be $6. The average cost per send we see from Reachdesk users is $27.90.
Wondering what you can send? Here are the Best Corporate Gifting Ideas for Q3 2022
6. Close rate
Close rates tell us how many customers have converted from being prospects in the sales pipeline. If you’re in sales or marketing, you might look at close rates when determining the number of opportunities influenced by gifting to show its effectiveness as a strategy.
To find out the close rate of a campaign, divide the number of customers generated by the number of prospects in the sales pipeline and multiply it by 100. So, if you’ve generated 100 customers with your gifting campaign and there are 500 prospects in your pipeline, then your close rate would be 20%.
7. Cost per acquisition
Cost per acquisition (CPA) refers to the amount of money that each new customer costs to acquire. When measuring the cost per acquisition of your direct mail campaigns, we need to measure how much was spent on gifting for each new customer.
This direct mail marketing metric is important because it helps to determine whether your direct mail campaign is cost-effective. To measure the CPA of your gifting campaign, divide the total campaign cost by the number of new customers generated. So, if the total campaign cost was $5000 and you gained 30 new customers, the CPA would be $166.66.
Wrapping up
You don’t need us to tell you how great the power of gifting can be - the proof is in the pudding. But measuring and keeping track of the results of your direct mail campaigns helps to prove their value to your business.
Knowing which direct mail marketing metrics to measure is vital to being able to optimize your direct mail campaigns and make improvements to your strategy. So get out your calculator and start counting up those wins!
