3 Questions You Should Ask Your Direct Mail Agency
Selecting a direct mail agency partner is an important decision. Your brand will rely on this team for its growth, and you will rely on this team for your personal success as a marketer. As an agency representative ourselves, we have been a part of many selection interviews. We’ve noticed while high-level questions are often asked, there are several critical discussion items frequently left unaddressed. To help you get a granular understanding of how the agency operates and the value they provide, here are three questions you should be asking your direct mail agency candidates to make sure you select a partner that will represent you and your brand, best.
What is your data philosophy?
Upwards of 70% of your campaign success relies on the strength of your mailing list. The quality of the data sources used to build your mailing list lays the foundation for a performing campaign. It is important you understand your direct mail agency’s data philosophy and approach to list building so you can effectively reach your best audience and efficiently scale your program.
Some agencies practice a data-agnostic approach while others tend to lean on a single vendor or data provider. Limiting your data availability can mean limiting your results and growth, therefore real-world data sourcing competition is incredibly powerful. With access to multiple databases, your agency can collect the most accurate and relevant consumer attributes to identify the most promising lists of prospect targets. Data scientists can then interpret and transform attributes to create new variables to model against.
Data security is another important aspect of an agency’s overall data philosophy. During list building and prospect modeling, the agency will request access to your sensitive first-party data (active customers, former customers, leads, etc.). Before you share any of your information with an outside vendor, ask about their data security standards, certifications, and processing practices. AICPA SOC2 certification and the HIPAA Seal of Compliance are a two examples of data security credentials that agencies can obtain to demonstrate their commitment to data privacy and confidentiality.
How will you establish a performance-driven program?
This may be a loaded question, but it’s included on this list for good reason. Investing in the direct mail channel is a financial commitment. The last thing you want to do is waste money sending pieces to the wrong audience or spend time explaining away an elusive ROI. Since your goal is to build a growing and profitable program, you will need to partner with a direct marketing agency that has a reputable history of launching and then scaling performance-driven campaigns. There are many factors that contribute to this type of program, but agency track record, testing methodology, and multi-channel approach are typically at the core of this discussion.
Direct marketing is not brand marketing. Case studies, client testimonials, and referrals will show you if the agency understands the difference. Watch for success with brands who had similar obstacles or goals to yours. Review their published content to verify they are recognized as industry thought leaders and know what it takes to build a profitable and scalable program. Pay attention to what makes them different from their competitors and even examine whether they are growing themselves.
A dynamic yet risk-averse approach to testing is fundamental to any performance-driven marketing program. Ask how the agency will verify what is working and what is not. Determine if your brand can financially weather the lengthy timeline of an A/B testing strategy or the expense of a multivariate approach. If the direct mail agency has its own methodology, ask how it will quickly, accurately, and cost-effectively identify the winning combination of list, offer and data to continually work towards program optimization. This is also a good time to discuss ROI scenarios and ramp plans to set short term and long term KPI expectations.
Although direct mail can be a successful acquisition and retention channel on its own, when it is part of a larger multichannel strategy, you can expect your overall program performance to experience a significant boost while your cost per acquisitions drop. Your mailing list can be onboarded to social, display, email, and even connected TV to extend your audience reach and maximize your budget. Ask your agency how and if they can implement, test, and grow your program across multiple channels.
How do you encourage a transparent and collaborative partnership?
Effective, efficient, and valuable business relationships are rooted in collaboration and transparency. Ask the agency how you will work together to maximize your program success with regular communication regarding strategy, analytics, and financial expectations.
Verify that the agency’s communication schedule fits your needs, whether that means daily email interactions, weekly calls, or monthly in-person meetings. Are you working with your own dedicated team? Or do your contacts shift based on agency demands or expertise? You must also be comfortable with how campaign analytics are tracked, analyzed, and shared with you. Are you receiving a simple table of results or are you presented with takeaways, insights, and next steps? Do you have access to an API-fed, 24/7 cloud-based dashboard to review your most critical metrics? Lastly, do the payment terms align with your brand’s financial needs? Some agencies require payment up front, charge hourly fees, or operate on retainers. Others keep fees low and tether their earnings to the success of the program with a cost-per-piece model. Some even allow your campaign to generate sales before your final balance is due to help with cash flow. Whatever the explanation, these are all good things to know upfront.
Your direct mail agency is literally touching your audience on your behalf. Asking insightful questions such as these will give you a full understanding of their capabilities and the value they can bring to your business to help you identify the best match for your growth goals. Contact us today to learn how we can help.
Featured in BRAND United on 1.19.2021