We recently worked with a client who had been using the Royal Mail to distribute their marketing materials. Among many of their ‘rules’, the Royal Mail only ever distribute to an entire post code area. The ‘advantage’ is that they are cheap, at least on the face of it. This case study will show that the perception of using a low cost distribution service is very often badly wrong as this case study will show.
The company in question were selling a product that was only applicable to people who owned their homes. We always keep information on our clients confidential so let’s say that they were selling paved driveways. This means that their target market was
1) people who owned their own homes and
2) the house had to have a driveway.
We took a random sample of the areas into which they were distributing their materials and found that in over half of the areas, only 40% of the area was made up of privately owned houses. Of those 40%, 20% were flats, which means that 68% of their materials were being delivered to people who would have absolutely no interest in their service!
Lets say they were paying £40 per 1,000. They probably thought that this was a great deal but when you look at the numbers, they were actually paying £125 per 1,000 targeted customer! On top of this, they had to print 68% more leaflets than they required which was not only a waste of money but is also not exactly environmentally friendly!
Using our demographic systems, we were able to identify areas which were much more closely matched to their target market. In addition, we were able to tell our delivery staff to deliver to houses that matched their criteria. In doing this we not only reduced their printing and distribution costs but we also increased their ‘hit rate’ because their marketing materials were delivered to people who could use their services.
For further information on the services provided by Royal Mail (and similar companies), read our article “Distribution Unlimited vs Royal Mail“.
