Demystifying direct mail: What mortgage brokers need to knowJustin Andrewsdirect mail, marketing, USPS
You've got mail and plenty of it to send out to potential
borrowers ready to pump up your pipelines. After hours of
brainstorming a creative campaign and testing your data lists for
accuracy, you're ready to drop your mail and start making more
money. The copy is catchy and the design is dead-on. You've
invested a considerable amount of time and money into getting the
campaign just right and you're anticipating a great return on your
efforts. You depend on direct mail to help keep the blood flowing
and the hearts beating at your shop, so what happens when direct
mail is unpredictably delayed, nearly causing a full-on arrest of
your operation?
Besides telemarketing, direct mail is the motor that runs most
mortgage brokerage shops vying for those coveted leads, which are
harder and harder to come by. With the dreaded Do Not Call list
imposing growing restrictions on lead generation, reliance on
direct mail is even greater. And the reliance is more than
justified. According to the United
States Postal Service (USPS), the average American spends more
than $244 million on goods and services advertised through snail
mail. But recent prolonged delays with unpredictable, standard,
third-class mail have left many a broker biting their nails as they
wait for the mail to hit and the phones to start ringing.
Before the anthrax scare following 9/11, bulk mailings took an
average of only seven to 10 days to land at their destinations. Now
it can take upwards of 30 days for mail to arrive. And who has time
for that? Speculation runs high about the reasons for these delays.
Perhaps it can be attributed to the USPS Office's Mail Evaluation
Readability Look-up Instrument (MERLIN), a tool used by the USPS to
assist with the acceptance of business mail. Or maybe it has to do
with the size and color of the bulk mail. Whatever the case may be,
we do know that there are no longer any guarantees with standard
third-class mail. Granted, opting for standard (or bulk) mail means
relinquishing total control of delivery time to receive deep
discounts on postage rates. The post office is able to offer
bargains on bulk mail because it is processed at USPS' convenience.
And that means it typically can take anywhere from five days up to
more than a month for your mail to arrive at its destination.
Vital to the survival of many brokerage shops that rely on
direct mail is smarter mailing the need for consistency and
predictability. To circumvent the deliverability delays and
subsequent lagging leads, be sure to consider the following
strategies for your next direct mail drop.
Bar coding
One effective method of speeding up mail delivery is to have your
mail bar-coded. By bar-coding (or automating) your mailings, it
will make its way through the USPS more quickly, as it's processed
on high-speed postal sorting equipment.
Postal pre-sorting
In a perfect world, delivering direct mail would be as easy as
placing a stamp on an envelope, dropping it down the chute and away
it goes. Unfortunately, the world isn't perfect and sending direct
mail isn't easy. It's a complex beast that requires the sender to
adhere to the USPS's 600-plus page manual full of rules,
regulations and procedures. This includes postal pre-sorting. More
than a systematic way to group mail for efficient handling, it
hastens delivery times and offers postage savings. The best way to
exercise presorting is to partner with a provider that extends
Presort Accuracy Verification and Evaluation (PAVE) certified
software. This will help arrange your list in USPS-specified order
to produce labels or files that guarantee your mail is in full
compliance with the standard third-class mail regulations, while
ensuring the lowest postage rates on your mail.
Commingling
Essentially, commingling merges multiple streams of mail from
different senders into a single mail stream. Significant postal
discounts can be had with the right combination of high-volume mail
jobs shared with other companies. In order to receive a five-digit
zip code postal discount, USPS requires a minimum of 150 pieces of
mail that target the same zip code. By commingling runs,
distributors increase the likelihood of meeting the 150-piece
target, thus acquiring significant savings.
A caveat about commingling: Once you begin the process, it's
nearly impossible to stop. Halting a commingling job can only be
done by hand. What's more, by pulling your commingled job, mailing
rates for all jobs combined to create the single stream would
alter. In effect, you would unfairly raise the postal cost for
parties who remained commingled. The moral of the story here is to
not commingle if there is even the slightest possibility of having
to discontinue the job.
Drop shipping
By employing both drop shipping and commingling to your direct mail
campaign, you increase your savings even more. In its simplest
terms, drop shopping refers to trucking mail to a postal facility
near its point of entry. USPS grants you discounted postage by
work-sharing with you. The deeper into the postal system you first
process your mail, the deeper your discounts. In other words, the
closer to the final destination that your mail enters the USPS
system, the less postage you pay.
Simply depositing your direct mail at the local post office
subjects your project to go through some rebate-reversing
rigmarole. Typically, your mail will start at the local post
office, be handed off to the local section center facility (SCF),
then be passed on to the bulk mail center of the destination, after
which it will be forwarded to an auxiliary service facility and
then it will be delivered to the destination SCF, and finally your
mail will reach its desired destination. Mail is delayed from three
to 72 hours at each of these drop-off points. But by drop shipping
directly to the destination SCF, you would capture a three to five
day gain on getting your mail delivered more quickly.
PLANET code/smart seeding
Smart seeding is a mechanism to track mail by assigning a PLANET
barcode to each tray of mail (rather than printing codes on every
piece of mail) to monitor its progress through the postal system
and thus allow you to allocate appropriate staffing needs when the
mail hits. The assigned code gives the customer real-time knowledge
about where the mail is in the mail stream. Whenever mail with
PLANET codes is processed, electronic records are generated and
sent directly to the sender or can be accessed online in the "Mail
Tracking and Reporting" section of the USPS Web site, www.usps.com.
First class mail
As we've already established, standard third-class mail is
unpredictable. Pinpointing delivery timeframes can be tricky, as
they differ greatly, even within the same mail stream. If you have
up to 30 days to spare for your mail to hit, than standard mail is
the way to go. However, if your campaign is time sensitive, then
first class mail is going to be your best option. Though it carries
a higher premium, it offers the best cost/benefit ratio as your
mail delivery is guaranteed.
These are just a few strategies to consider before planning your
next mail drop. The best advice you can take is to invest in
working with an experienced direct mail vendor who is thoroughly
versed in direct mail best practices. By working with an
experienced mail vendor early and often, you'll save yourself a
huge headache, not to mention time and money.
Justin Andrews is vice president of marketing and one of the
founding members of Merit
Financial. He can be reached at (800) 720-6299 or e-mail
[email protected].
