Direct Mail Isn’t Dead
It was like flipping a switch, or maybe more like opening the door, Patrick Bartel says. Whatever the analogy, one thing was for certain: It worked, and it worked quickly.
Like any small business owner, Bartel dreamed of growth. Since moving from a gas-station garage to his first stand-alone facility in 2003, Bartel had his sights on big things. Almost right away, Bartel’s Auto Clinic was on a $750,000-per-year sales pace, but being just outside Chicago with an eight-bay building, Bartel felt he could pull in more, higher-quality vehicles.
Enter direct mail. Bartel started using direct-mail marketing in 2005, and within two years his original Carol Stream, Ill., shop doubled sales. “Original” is a needed adjective, because he was able to open a second location in 2006 to similar results.
And in May of 2012, he opened a third location. Within six months of opening his doors, car count was at 450 per month (matching his other stores), and the shop was on pace for what would’ve been $1.25 million in sales had it been open the whole year.
“[Direct mail] makes an immediate impact,” Bartel says. “It’s my main marketing (strategy), and it really drives my business.”
In an age where more and more emphasis is placed on new, more advanced marketing technology, one simple fact remains: Mail marketing isn’t dead, and using direct mail is still one of the most viable resources for bringing in customers. All a shop has to do, Bartel says, is understand it and learn how to use it effectively.
A Direct Explanation
Direct-mail marketing is a systematic, targeted approach for reaching your shop’s desired customers. That’s the easiest way to think of it, says Tim Ross, president and co-founder of one of the industry’s leading marketing resources, Mudlick Mail.
Breaking down that definition, the “direct” part comes from the foundation of the whole process: Shops start by identifying their target demographic (i.e. the customers they want). Then, they mail postcard advertisements only to those people.
“What you’re doing is creating a way to get your name, your offers, your brand in front of the people you want coming in every day,” he says.
Taking A Step Back
The auto repair industry is far different than it was 20 years ago, says Ross, who also helps run more than 30 repair facilities with Mudlick co-founder Greg Sands.
“Customers used to come in about three times per year,” he says. “What we’re finding with oil being better, cars being built better, parts and equipment being better, people aren’t coming in as often. It’s closer to 1.3 times per year now.”
This means shops have to expand their customer bases to remain competitive in today’s market. And direct mail is a great way to do that.
Ross is quick to point out that direct mail is a single piece—albeit an important piece—of a shop’s overall marketing program. All businesses need to have quality websites. They need to utilize email marketing and have service reminder programs, as well as many of the other newer, more advanced marketing tools.
“Direct mail, though, is still the move-the-needle element of your marketing,” he says. “It’s very powerful, and it’s tangible to measure.”
Why Direct Mail Works
For a website to be effective, someone has to seek you out. For email marketing to work, customers have to actually open the emails. Social media? People need to be willingly involved.
“And all of it’s great, and it works to an extent,” says Jay Siff, CEO of Moving Targets, one of the industry’s leading marketing firms. “On a gut level, people say [direct mail] is old fashioned, but when you read all the research, kids today profile the same as their parents and grandparents: They go to the mailbox, they grab mail and redeem coupons at the same rate.”
What makes direct mail so powerful, Siff says, is that even if the person takes the postcard and throws it right in the recycling bin, it’s still guaranteed, at some point, to be in their hands. And you’re guaranteeing that it gets into the right hands by carefully selecting the demographics you wish to target.
Direct mail offers simple, manageable tracking. Ross refers to today’s direct mail pieces as “high-tech postcards.” Nearly all companies provide unique phone numbers for each mail campaign that will then track and record the amount of calls coming from that advertisement. Also, as many of the pieces will have specific coupon offers, shops can simply count the cards that are returned.
The returns can be significant, as well. Ross says that Mudlick gives a “safe estimate” of a 0.25 percent response rate on each direct-mail campaign (Bartel says his shops see closer to a 1 percent response rate). That sounds small, but consider that most will send out somewhere between 5,000 and 10,000 pieces per week, and those numbers add up significantly in the long term.
“The average, long-term customer is worth an average of $900 a year to a shop,” Ross says. “This is an investment you’re making by trying to gain these people as customers and build that business with them over time.”
The Focal Points
Essentially, Ross and Siff say there are three areas to focus on in any direct mail campaign: the message, the demographics and the tracking.
The goal of direct mail isn’t to sell a customer work on their vehicle; that’s the service advisor’s job. The goal is to get the customer to make contact with the shop. And, while selecting specific customers in your area, you’re not looking for the bargain shoppers, either. Because of that, Ross says you need to focus the marketing message on how your shop adds value. List warranties, expertise of staff, community ties—anything and everything that will differentiate your shop from your competition.
Still, the majority of mailers do include some “compelling offer” to come try out your shop, Siff says. “People are always looking at it with the same mindset: What’s in it for me? It’s the offer, and it’s showing them why they should be choosing you and your shop.”
Who’s your target customer? Bartel says his shops look for homes within 3 miles of each location that have an average household income of more than $75,000. Ross says to choose your demographic carefully. And this should, by default, include a mix of new and existing customers, as many of those in your customer base should be in those demographics.
Once you know whom you’re targeting, you find the postal carrier routes that will hit those people. That information is available (at a price) through the U.S. Postal Service, or through a number of private entities. Direct-mail companies, if you choose to use one, will also generate that information for you.
This will also help you determine how many pieces to send out each campaign, and how often. Bartel identified four groupings of postal carrier routes that met his demographics. He now sends out 5,000 postcards per week at each of his stores, rotating a different postal route group each week. In all, he averages a little less than 25,000 mailers per store each month.
Siff also suggests looking at “trigger events,” like potential new customers moving to your market or sending out mailers that correspond with your past customers’ birthdays.
Using a third-party company, one that specializes in direct-mail marketing, is the simplest way to track your return on direct mail, but there are ways to do it yourself. Shops can use a dedicated phone line solely as the source for direct-mail-initiated calls, and then keep track of the jobs that come in from it. Also, a shop can simply count the postcards that are brought in or ask customers how they heard of the shop.