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Case Study: Direct Mail
What Happens When your Formula Stops Producing Results?
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Written by John Rooney
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In this segment, we take a look at what can be done when a proven formula stops producing as it once did in the past. While this particular study features a standard refinance offer, many of the best practices listed below can be applied to multiple categories in and beyond the mortgage industry.
Background:
Tell me if this sounds familiar: An established mortgage company needed to change-up their direct mail campaign to help reverse declining response rates. It’s all too common these days. So, what could be done about it? Based on historical research, and a closer look at the status quo, we decided to test three tangible factors to determine a new formula for success.
Objectives:
- First and foremost, increase response rates back to – and beyond - the 2010 levels.
- Initiate an immediate change in time to drop by week 1.
Strategies:
- Review last year’s “high water mark” response rates to discover historical trends and common denominators.
- Test new mail strategies in the following areas: list sources, letter content, and envelope format.
- List Sources: As a solid alternative, Experian was chosen as a “credit bureau worthy” source that also offers a modeled interest rate filter (i.e. min 5.75%).
- Letter Content: We chose to continue with an existing letter – except we added a timely message with a specific sense of urgency. The letter was established as a standard fixed variable across the board – content changes could be made later, after the test period.
- Envelope Format: The snap-pack style mailer has been a key common denominator. Did it make a difference in 2010? Can it still help improve current response rates? We decided to test it and see…
Tactics:
- Set-up an A/B test using two list sources, two envelope formats, and one letter version.
- Spread the test over four drops, and track results for post-analysis – gather important info for the next month and beyond.
Test Schedule:
Week 1: Experian data – letter/envelope
Week 2: Equifax data – snap-pack
Week 3: Experian data – snap-pack
Week 4: Equifax data – letter/envelope
Results:
So, which combination proved to be the new secret sauce? If you’re interested in taking your marketing to a whole new level, contact me today for a free consultation to learn all the answers, and then some.
Senior Marketing Consultant
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