You’re sold on the direct, guaranteed delivery and WOW factor that only printed newsletters can deliver. But which cost effective marketing channel gives you the most bang for your buck?
You’ll be hard-pressed to find solid, if any, updated studies when it comes to social media and return on investment. In fact, social media’s ambiguous ROI is notorious among marketing professionals—a shocking 85% of social media marketer’s aren’t even sure which tools are best for tracking (Source: Social Media Examiner, 2014).
Because so many people have at least one social media profile and social media advertising is seemingly so affordable, many business owners fall into a monthly trap of spending hundreds, if not thousands, of dollars to boost posts and run ads without scrutinizing the actual return (i.e., how many dollars in sales were generated via social media referrals) and whether this is a cost effective marketing strategy. One of the problems is there’s no concrete way to really track your overall return with concepts like brand exposure. Moreover, if you’re simply trying to understand how much your Facebook or Twitter page plays a role in driving traffic to your website, a lot of the more sophisticated social media tracking platforms cost you additional money, only complicating the ROI calculation. If you do invest any money in social media ads, check out Google Analytics, which essentially tracks where your website traffic is coming from. It’s not a complete picture of what’s going on (for example, someone might see your Facebook ad but open an entirely new window, Google your business, and then make a purchase or appointment), but should provide you with a general idea. Don’t forget to include either the time you yourself invest in brainstorming, creating, and scheduling ads and posts or the amount you pay an assistant or social media manager for this service.
Because it has a more direct purpose and is much easier to track, email marketing is more promising in the ROI department as a cost effective marketing strategy. According to a 2015 report by VentureBeat (a technology trends research and news source), every $1 spent on email marketing yields a $38 return. In fact, email marketing has been found to be a 40 times more cost effective marketing strategy than social media in customer acquisition (Source: McKinsey). Though this is good news for some industries, email marketing isn’t necessarily as effective across the board, and many individual businesses continue to face dismal open rates and even fewer follow-ups. While we certainly don’t encourage you to abandon this marketing channel, we recommend going the direct mail newsletter route first, and then following up with emails when you’re having product launches or events. As you start tracking the response to your follow-up emails, don’t forget to give credit to your printed newsletter as the point of initial contact. In fact, you might consider keeping a separate contact list for your printed newsletter recipients who then receive your emails in order to simplify the process of calculating your ROI.
Because it’s guaranteed to be seen and will likely be perceived as more valuable given its tangibility, direct mail continues to reign with impressive results as a cost effective marketing strategy. In fact, direct mail exceeds all digital marketing efforts combined by over 600%! (Source: Direct Advertising Association Report, 2015). The same report found that although the cost-per-acquisition for direct mail is approximately $19 (compared to $11-$16 for email marketing and $16-18 for social media), direct mail’s average response rate is 3.7%, compared to just .1% for both social media and email marketing, making it a very cost effective marketing strategy. Remarkably, a whopping 70% of consumers report reconnecting with businesses they had lost touch with after receiving direct mail (Source: Direct Marketing News, 2014). What’s more, because so many companies are forever chasing the elusive pot of gold at the end of the digital marketing rainbow, you have very little competition these days!
To determine your own response rate, simply divide your total responses over any given time by the total number of newsletters you send out. Develop methods for tracking your readership before you send your newsletter and tally your responses to make sure this is a cost effective marketing strategy for you.
Of course, the ROI for these cost effective marketing strategies is unique to each business, and it’s up to you to carefully track which cost effective marketing strategy is most successful in driving customers and prospects to your business. While sources like Google Analytics and social media insights can give you an idea, they can also be deceiving, and the more cost effective marketing strategies you employ, the foggier these metrics get. For example, let’s say you have a newsletter reader who decides to check you out on social media. They then make an appointment using your Facebook appointment setter. So did they come to you via social media? Technically, they discovered you through your newsletter and used Facebook as the point of connection. And this is just one complicated scenario of many.
For this reason, we recommend getting very proactive and specific in asking people how they found you. In addition to incorporating tracking methods within your newsletter, your office team should be asking questions like, “How Did You First Hear About Us?” followed by a list of options that includes your newsletter, blog, a social media ad or post, or a Google ad. By the way, unless you’re proactively boosting posts and running ads, be leery of people who tell you they “found” you on social media. Why? Because the organic (unpaid) reach is so paltry, unless they discovered you through a shared post or via hashtag searches, it’s doubtful that social media was the original source. In other words, whenever someone responds with “Facebook” or whatever social media channel you’re on, follow-up by asking, “Oh, did you see our post in your news feed?” This may trigger their memory and lead them to realize that Facebook was not the driving force, but just a landing page, so to speak.