Direct Mail Marketing: Multi-channel approach achieves 700% ROI

SUMMARY: Retro can be both cool and effective — just ask Intronis, a data protection company. It implemented a multi-channel campaign centered around a dimensional mailer, with an initial direct mail incentive being an Atari game console replicator.

The effort included two direct mail pieces sent to high-value prospects to drive a 30-minute phone conversation with Sales, along with an email element to introduce the campaign. Even though the campaign featured fairly expensive incentives, the effort drove a 700% return on investment.

by David Kirkpatrick, Reporter

THE CUSTOMER

In this era of big data, data protection is becoming a more prominent industry. Intronis provides cloud, backup and data protection for the small business marketplace, currently serving around 50,000 customers after having been in business for 10 years.

Intronis sells its services through the IT services channel and seeks to engage with IT service providers, also known as managed service providers (MSP), that in turn directly serve clients with Intronis' data protection services and software.

Aaron Dun, Chief Marketing Officer, Intronis, said the company's MSP prospects are often small businesses themselves, with maybe 10 to 50 employees. The target prospect will be the owner or director of technology, and both of these roles are not easy to bring into the pipeline via typical marketing efforts such as email campaigns or cold calls.

CHALLENGE

The goal of the effort was to actually reach that elusive target audience.

"One of the things that we were working on when I got here was segmenting out our customer opportunity, and then figuring out as we come out with a number of products that we made sure that we were attracting the right partner and the right customer," Dun said.

The team began segmenting that prospect base into the larger MSPs alongside other solid potential partners, who were a bit smaller and earlier in their growth curve as well as earlier in Intronis' sales funnel.

Dun said the go-to-market strategy became targeting the larger MSP segment and then "make sure that we were continuing to drive a healthy percentage of larger accounts through the funnel."

CAMPAIGN

The first aspect of the effort was what Dun described as an "exhaustive research effort" to understand the needs and requirements of the MSP segment and how Intronis could meet those needs and engage with those prospects.

Something that became clear while taking stock of the existing marketing efforts was that the team was engaging with both of its key segments with the same strategy and messaging. They also understood when reaching for higher level employees — even up to CEO — at the larger MSP segment, the messaging had become more tailored to a topic that would grab that prospect's attention.

Dun said the CEO of Intronis pushed the team to think differently about the new campaign, and they acknowledged that email wasn't necessarily going to be the best channel to reach prospects in this effort. The decision was made to execute a multi-channel campaign centered around direct mail.

Knowing their target audience was largely male between ages 30 and 50, the team found a classic Atari video game replicator and immediately decided that would be the incentive for the main dimensional mail piece in the campaign.

Step #1. Tailor the campaign for the targeted segment

The team realized that it had created two segments for marketing purposes, but they weren't really taking advantage of that segmentation.

"When you are running a thousand miles an hour, you just start executing campaigns," Dun said. "We realized, 'Hey, wait a minute. We spent all this time creating two segments on purpose. Why are we using the same marketing for both?'"

He added that the team understood that the MSP segment was different and that the current marketing campaign wasn't doing anything that was specifically designed to get that segment through the buying cycle.

Dun said the key difference in the MSP segment was the size of the businesses in that segment. Intronis' value to larger companies can be more clearly stated with marketing and sales activities.

He explained the difference, saying, "If you have two or three customers, the value of our product isn't going to be as obvious, perhaps, than if you had a hundred customers."

Another difference was the buying cycle itself. In the smaller business segment, the prospect being marketed to might be doing the evaluation and the purchase decision, so the sales conversation and then the conversion to sale might be relatively short.

The larger MSP segment typically had a more sophisticated process for vetting new technology, so the sales cycle would be longer and involve more internal gate keepers, along with possibly more than one person making that final purchase decision.

Dun said the challenge was opening the door with all those different people at companies in the MSP segment.

Step #2. Develop the dimensional mail piece

With the target audience determined and the incentive — the Atari replicator unit in this case — chosen for the mailer, the next phase was actually putting together the direct mail piece.

"When we came up with this idea of an Atari, we said, 'All right, now what?' Can't just send an Atari. There's this thing, and sure people will be excited about that, but how do we make it real? How do we bring it to life? And how do we drive the action which we wanted people to take, which was get a meeting with our sales people?" Dun said.

According to Dun, getting to that conversation was important because the sales team at Intronis was very good, and its solution addressed a well-understood pain point for its prospects. Dun added getting those "at bats" gave the sales team a good opportunity to close the deal.

The decision was made to make the incentive two parts. Everyone targeted in the campaign would receive the Atari unit, and anyone who then scheduled and followed through with a 30-minute sales call would receive a second dimensional mail piece, which included an upgrade to a Wii, Xbox or PlayStation console gaming unit.

The exterior of the first direct mail piece had a sticker saying, "Intronis got game," along with the company URL. The interior included the Atari unit wrapped in blue tissue paper with a letter placed where the recipient would find it first. The letter explained the total incentive with the upgrade offer in exchange for the 30-minute sales call.

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The messaging on the letter was, "Not everything that is old is this retro cool. It's time to upgrade your data backup and storage."

Step #3. Determine the timing of the direct mail sends

Dun said the team regularly tested different elements of the campaign as it progressed, and one element tested and tracked was how sending on different days affected the performance of that campaign send.

One result of this testing was learning that Monday afternoon was the best day and time to send the direct mail piece. Doing that allowed the package to arrive on a Tuesday or Wednesday, giving the sales team the rest of that week for follow-up and scheduling that 30-minute conversation.

The team figured out that Monday was the best the day for the sends because, one week due to a holiday, the package was sent out on Tuesday afternoon, getting to recipients on Wednesday and Thursday.

The result of sending one day later than usual was that the package went home with recipients on Friday afternoon, and by the time Sales called on Monday, some of the steam behind the effort was lost.

"When you called them on Monday and asked about the Atari, it's a cold call. There's no warm intro there whatever," Dun said.

He concluded what the team learned from that test. "We send them on Monday, or we don't send them," Dun said.

One other timing aspect to the campaign was determining where the prospect was in the sales funnel. The Atari mailer was only sent to prospects who were fairly far down that pipeline. Dun explained it was a matter of finding that point where in the buyer's journey that it made sense to hit the prospect with a high-value campaign, such as sending an Atari unit, and a follow-up higher end gaming console as an incentive to schedule a sales call.

Step #4. Include email in the multi-channel campaign

Although direct mail was the focus of this campaign, email also played a role.

The first email was sent before the initial mailer. This send was automated with the "from" field populated with the salesperson's name assigned to that prospect and with messaging letting the recipient know that they would be receiving an Atari unit in the mail along with a request for a call.

The campaign also included a follow-up phase for prospects Dun described as "non-responders," defined as anyone the sales team did not speak with, excepting anyone who responded with, "I'm not ready to buy," or "I'm not interested in buying."

"Our analysis suggests that we get most of our conversations and opportunities in the first week, and then there is a trailing second week, and then if we haven't gotten to them inside of two weeks, it's not going to happen," Dun said.

He added that the non-responders — people who didn't respond to the email, didn't engage on the landing page and didn't have any conversation with Sales — were a relatively small percentage of the campaign, but as the effort went through multiple rounds, that number began adding up.

The email messaging to the non-responders took what Dun described as a "cheeky" tone. He explained that after sending an Atari unit, the team felt it couldn't send an email with a boring subject line. He said the messaging was along the lines of, "If game's not your thing, how about a steak dinner?"

The incentive for these sends was a $200 gift card to a steak house.

Step #5. Define the buying cycle

In order to maximize the effectiveness of the sales pitch once the campaign achieved the conversion to the 30-minute call, the sales team followed a specific process.

The first goal was to ascertain the prospect had a pain point that Intronis could meet. From there, the prospect went through a qualification process via Sales to make sure there was an opportunity to actually make a sale.

For this campaign, the first question on the sales call was, "How did you like the Atari?" According to Dun, that incentive was universally seen as "amazing." So much so that one CEO emailed to say it was best marketing idea he'd ever seen.

Because the second stage was another direct mail piece that involved a pricier gaming console — a Wii, Xbox or Playstation — the sales team was given discretion on whether to set up the 30-minute phone call or not but were encourage to go ahead and take the meeting even if the prospect was clearly just trolling for the free gaming console.

"That's just part of the campaign cost," said Dun.

He added that the initial group of 50 prospects targeted in the campaign were highly vetted and considered the best potential customers, so the response was favorable.

One feedback he received from Sales was that the conversations went very well and that even prospects who were in the early stages of the sales cycle were likely to eventually convert. Out of that first group, a little over 20% ended up becoming Intronis customers.

RESULTS

The key metric from this campaign was a conversion rate of 35% and an ROI of 700%. Out of the initial group of 50 prospects targeted, 50% went ahead and scheduled the 30-minute call with Sales, and 22% of the 50 converted to Intronis customers.

This campaign delivered over 10% of Intronis' bookings in 2014.

This campaign featured fairly expensive incentives — two gaming units and a $200 gift card to a steak house for the follow-up campaign targeting non-responders — but Dun said, "We're willing to invest a little more in the acquisition of those customers because our expectation is that they are going to spend more with us. And, by and large, that has been the case."

One interesting result of the campaign was a bit of internal PR. All the Atari units were stored at the office in a conference room, and the marketing team would assemble the direct mail pieces themselves whenever a new round of the campaign was executed. The team has shared photos with the rest of the company of the Director of Digital Marketing, Richard Delahaye, standing in the middle of all the Atari units, and they also uncovered an old Atari ad featuring Stevie Wonder to share with the office.

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Dun said his best advice, as well as his key takeaway, from this campaign is to "get outside your own head. We all have such preconceived notions about different campaign ideas that you can be very prescriptive in what you think is going to work and not going to work."

He also added that this campaign was successful because the team took a very methodical approach with each round, including only 50 prospects and tracking the results of each round to improve subsequent rounds.