Dave Fink is the CEO and Co-Founder of Postie, a marketing technology company that has transformed Direct Mail by enabling it to perform like a digital channel. We discuss the new age of direct mail marketing, why customers prefer direct mail over other marketing channels, and the benefits of testing everything in your business.
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Resurrect Your Direct Mail Campaign With Dave Fink
My guest is Dave Fink, the CEO and Cofounder of Postie. It’s a marketing technology company that has transformed direct mail by enabling it to perform like a digital channel generating an over 13X return to its advertisers. Dave, welcome to the show.
Thanks for having me. I have been looking forward to this.
I’m very curious about how you did that. I long had a soft spot for direct mail, which I used extensively via my business fifteen years ago or longer now. It worked beautifully for a while, and then we moved over here to the States and it wasn’t working very well. I always wondered why. I had a couple of ideas, but I saw it as a dying genre and you’re reviving it. Can you tell me your story of becoming an entrepreneur, starting in the beauty industry with a couple of startups and then transitioning over to direct mail with Postie? How did that all play out?
The synopsis version for the purpose of this conversation is that since about 1999, I had spent my entire career in the consumer internet space. I have had the fun and mental challenge of bouncing back and forth between marketing technology businesses and then consumer brands that relied heavily on marketing technology to provide an advantage.
I have always been in the startup through rapid growth stage where efficiency matters, having some competitive advantage that allows your business to compete with much bigger and more established foundational businesses. It’s mission-critical. At a relatively young age and early stage in my career, I learned that leveraging math, testing optimization, and data prediction in order to be very efficient with the way that you think about growth and scaling is an advantage that early-stage companies have.
You touched on a number of topics there as we got started. One of those topics was direct mail or there are certain channels that are either not as utilized as they have been in the past. Our experience with the past years of building Postie, focusing specifically on the direct mail space, has suggested or enlightened us to the fact that that’s not the case, but that is the case in two key company types.
One of those company types are businesses that were created over the fifteen years or so in the digital era. Those businesses naturally were built on digital media channels. The technology and the innovation that has gone in those channels are remarkable. We all know that at this point. You had a bunch of relatively young and in some cases, inexperienced but very smart marketers that became quantitative at a very early age. They immediately jumped into the most innovative channels, which happened to be digital.
They didn’t move away from direct mail. It wasn’t just the first channel that they went to. They didn’t understand the systems that are required to make direct mail work. All along, this has been a $40 billion-a-year industry here in the US alone. It’s still massive and highly effective. What we are trying to do is help by building innovation and technology that allows a channel to be managed no differently than you would manage any digital channel. We are trying to help marketers who did not grow up in a more analog world to be able to get the value out of the channel because it’s so important right now as there have been consolidation and challenges on our core platforms like social and search.
The reason I stopped here is because I want to make a note to myself. I wanted to ask questions that may be a little bit out of place here. In terms of the deliverability of direct mail, you touched upon a little bit that one of the challenges that the B2B space has is that it’s very hard to reach the end consumer. You are sending the direct mail to a gatekeeper who probably files it. Is there a legit way of sending direct mail to the personal addresses of company leaders that’s off the table?
There are two things that you touched on. One is when you are trying to get through gatekeepers or a tangible piece of mail delivered to a mail room and then distributed to the individual. In theory, there are some additional challenges. The reality is that it wouldn’t be legal to not deliver a piece of mail by the US Postal Service to the recipient. It doesn’t mean that it doesn’t happen.
I don’t know that that’s the biggest challenge. I think the bigger challenge is knowing the individual you want to reach. It’s one thing to say, “I want to reach the marketing team at companies XYZ.” It’s one thing to say, “I know that these 3 people are influencers, these 2 people are the buying decision-makers, and these 2 people are probably involved in the buying committee. I want to be able to reach each of those,” and name seven titles.
Interestingly, now more than ever, there are great B2B data sources out there that are oftentimes used primarily for digital channels like email outreach, but they can be used. There is certainly LinkedIn that is an absolute treasure trove of information. Building not just your ICP or Ideal Customer Profile but also the actual individuals mapping those organizations had never been easier. On the other hand, it’s a lot of work because it’s easier than ever before.
The other challenge that comes into play in delivering a physical advertisement was COVID and work-from-home issues. As we thoughts we had the right data sources and could reach individuals at their workplace, all of a sudden, everybody is working from home.
I’m the first to say that I don’t want work calls on my personal cell phone or my landline. I don’t have one but if I did, I wouldn’t want to be reached there. I would want to be reached in a professional setting during business hours. There’s nothing more offensive than getting called on a weekend for a business call. This isn’t trying to sell me fiber in my own home. This is work calling.
A few weeks ago, I got a call and the caller said, “I’m going to be upfront. This is a work call. I’m calling you on a Sunday and it’s a cold call.” I said, “It sounds like you have a good understanding of why that would be a bad decision. I’m not interested in talking to you right now. I wasn’t trying to be rude, but I get a little bit of time with my family in between busy work weeks. I think that’s bothersome.”
In an active blended with a passive media channel like direct mail, you are actively reaching an individual in a very personalized way but you are giving them the decision on when they want to engage with that ad. I don’t think there’s anything disrespectful about that. The challenge is how you find people’s home addresses. That’s a challenge in B2B. To be quite honest, it’s not something that any data provider has solved. We are also seeing more and more companies moving a higher percentage of their workforce back to the office. That challenge may dissipate over time anyways.
I just want to get that out there. Going back to direct mail. How has the direct mail market evolved in your view over the last fifteen years? You say the new companies have been focusing on digital and maybe they dropped the ball on it, but there was a transition. People channeled resources into digital which had to come from somewhere. Maybe some of it came from direct mail. How do you see the evolution of direct mail? Was there a decline? Is there an increase or is it a lower level? Is it the same level? Is it just digital or was there an extra channel that grew up on the side? Give me a context here.
I would think about it in terms of macro trends within advertising, both in business and consumer engagement in general. My perspective on the reason why folks like us spent so much effort engaging with digital channels was because there are three buckets of capabilities that are valuable in addressable marketing, where you are able to target individuals personally.
It’s different from more of your branding efforts where it’s not one-to-one outside of addressable TV. Linear TVs and billboards outside of homes are not addressable channels, but digital has greatly become addressable. When you think about social platforms, search, programmatic display, and email, those are channels that allow you the ability to reach specific individuals you want to reach. It also provides you with the targeting in many cases so that you can be specific in understanding who you want to target and how to target them.
That leads to your messaging and your frequency. You’re thinking about them as individuals or tight groups of individuals with similar commonalities which allows you to focus on why your product or service would be a benefit to that specific individual or that tight group of individuals. Piece one is the target capability of digital. Piece two is the executional stuff.
With digital ad serving, you don’t have to deal with manufacturing, production, and complex logistics. You still have deliverability issues on things like email or ad serving. No question about that, but you don’t have to deal with the manufacturing. All the automation and deliverability of your ads have been incredibly innovative.
The third piece is measurement. Measurement is a hot topic. There’s no one source of truth per se, but there has never been a time when it has been more possible to triangulate performance, understanding which of your marketing hypotheses or which of your touchpoints are working best and helping you make better budgeting decisions.
All those three things accelerated in the digital era because of technology. In direct mail, up until modern times, none of that had been innovated. The delivery was still the same. The lead times on campaign deployment were still the same. The rudimentary ways that data was being used in most cases were still the same. Not all because there were some savvy folks and organizations out there, but mostly it was much more basic than what has been done over the last decades or so with machine learning and modern math or predictive mathematics. Measurements were clunky and inaccurate. It was possible but it was not as clean as it is now.
Our perspective was not that direct mail isn’t effective or isn’t scalable. It was how we take what we have learned over the last twenty years to create the ideal targeting capabilities, tighten up and make deliverability fast, accurate, smooth, and simple, and then how you make measurement clear so that the learnings that you are taking away from any campaign tactic or strategy, when you replicate that in the future, it delivers the results as expected. Direct mail has always been a channel where those things have been possible. It’s just been hard to pull that off without technology.
Are you saying that now with direct mail, it’s like any other digital channel? You can get all the benefits of measurableness, fast delivery, customization, and direct response elements. Do you have all these things now in direct mail? There’s no drawback of direct mail compared to digital.
Every channel has its benefits and challenges, and marketing is hard. It’s hard to build a brand and tell your story and have consistency, growth, and confidence to keep spending into your test optimization strategy, but 100%. We see day in and day out with thousands of advertisers, tens of thousands of campaigns, and tens of millions of ads that are distributed through the platform that direct mail is a highly performant channel, impactful in your marketing stack, and helps make all your other channels collectively work better as well.Direct mail is a highly performant channel, impactful in your marketing stack, and helps make all your other channels collectively work better as well. Click To Tweet
How do you measure it? It’s harder for someone to respond to a direct mail piece than to click a link and go to a website. They have to physically do something. They have to go to a computer and type something in. Are there other ways to create a response that’s measurable?
There are a number of ways that you can implement primary and secondary measurements. I’m a big proponent that you should be looking at all of your channels in multiple ways. There are two goals in measurement. Goal one is evaluating what you did. If something in your most recent marketing execution delivers positive or negative results, what can you learn from it?
This is the other piece that is more important. Is the expectation of replicating what you did likely to deliver similar results? The reason that’s important is because what you are trying to do is figure out how you can allocate more budget to things that are working. It’s great to know what worked in the past but if that doesn’t help provide guidance into what’s likely to work in the future, then it’s not providing the leverage that you are looking for from being a quantitative marketing organization.
With measurement in direct mail in particular, direct mail is a channel that requires you to know the physical address of the individual, and in most cases the name of the individual. For every cell that is set up through a direct mail campaign, you have this entirely clean audience and data on that audience like name and address. You have this very clear deterministic match key.
This doesn’t apply to all businesses, but more businesses now either have a direct-to-consumer relationship online through a mobile app. They are doing a better job of collecting consumer data at their point of sale, either through a loyalty program or through some registration. That allows them to know their customer better. It also allows them to have a deterministic match key if you know the name and address of your transactor, converter, or customer. You can map that back cleanly to an individual who received a piece of direct mail during a specific tight attribution window. You then know that the direct mail piece had an effect in driving that action.
There are other more complicated mathematical structures. You can look at incrementality and lift compared to a longitudinal view on including direct mail or not including direct mail into your media mix. For those brands that don’t have the ability or haven’t quite implemented the ability to capture that name and address at a conversion event, there are ways to leverage secondary data sets for at least some blend of probabilistic measurements such as URLs, digital fingerprints, or QR codes. Those are not as clean, but you can only do as much as you can do as a brand.
The trick is you have to get the recipient to do something. Sometimes they do something that you can accurately identify them. Sometimes it’s a probabilistic identification, but they have to respond. How do you make them respond? We talked about different frameworks to essentially influence people. I wonder if there is a framework that you use. Maybe 3 or 4 ideas that help a copywriter influence people so that they pick up the phone, go to the internet and type something in, take a picture of the QR code, or do something? What is your framework for that?
I can talk high level a bit about how you drive performance. We have a team of optimization specialists and service providers who are even more nuanced these days about the specific targets they are working on now and in this season.
Please give us the high level.
I will do my best in a 10,000-foot view. First of all, testing is everything. Maybe it sounds obvious, but sometimes we forget about it. The beauty of addressable or quantitative channels is that it’s possible to do A/B and multivariate testing to identify the specific components of audience selection, creative, and frequency in order to learn each time we are allocating the budget.
We want to take something away and understand what is driving the performance. There are best practices, but what works for every brand, product, or service is going to be slightly different. Sometimes it’s dramatically different. There are three levers that you can pull to drive performance. One is targeting and we can come back to that.
The second is creative. That’s everything from the overall design of a piece of creative to the subject line, to the way you are presenting your benefits, to sub-content or any offer, a CTA or Call-To-Action. The overall aesthetic, whether you are using product photography and imagery or lifestyle imagery. All of those things matter and oftentimes mattered on a very nuanced segment-by-segment basis.
What works for your early adopters may not be the same thing that is going to work for harder-to-convert prospects. If you have a product service that appeals to a broad set of geographies, the way that people respond on the East Coast in the winter may be very different than the South or the West Coast where there are very different weather patterns. All those things matter and because of it, you got to test. You have to bring enough budget to every channel to be able to get enough test cells. The bigger budget that you can allocate upfront, the more that you can test, and the quicker that you can learn what works, but you got to be committed to that.
To talk in specifics, I did not always believe this in my career, but over the last ten or so years, I parlay it as the democracy of content. The internet became ubiquitous in how consumers engage with research and how they shop. Being authentic to your brand is critical. It doesn’t mean that you can’t stray away from it to drive a little bit of a higher conversion rate in one campaign or another, but in the long run, consistency and authenticity almost always wins out. What I mean by that is if you start a business, you understand the problem that you are trying to solve. You understand the differentiation.In the long run, consistency and authenticity almost always wins out. Click To Tweet
The key is figuring out how to tell that through all of your advertising channels and all your content channels consistently and frequently, and make sure that the message lands. That doesn’t matter whether it’s an email, a podcast that you are doing, a TV spot, a billboard, content you are presenting at a conference, or a direct mail piece. The consistency with which you communicate to your customers on your product, your service, and your benefit statement of the reasons why they should pay attention matters.
You then start looking at the broad strokes. There was a thoughtful marketer at one of the most notable brands in the world that I was talking to a few months back. He talked about how he’s always wrestling with his brand marketing team on how not everything that they do has to be Rembrandts. I think that was his exact term. Meaning that you got to be able to be a little less precious and test things.
That doesn’t mean stray away from your brand, but that does mean if you want to test a slightly different message or a different set of images, you don’t have to sit around and wait until you have the perfect image or the perfect copy. You can get something that represents exactly what you are going after, you can get it out fast, you can learn quickly, and then you can work on making it more perfect over time.
If you are doing it right, you are going to be throwing out way more content than you are going to be recycling and reusing it. You are always testing and you are always trying to find performance gains. You have winners and losers in your test. If you don’t have enough losers, that means you are not testing enough. You are not trying enough.
Lots of testing is going to go on.
Those are some high levels. You know your audience better than me. We certainly can go down the rabbit hole a bit more if you think about valuables and specifics. To me, those are some principles that you can take into any channel, but you should take them into direct mail.
The three things I heard are content, creative, and testing. If you get those three right, then you have the basic building blocks. Create the consistency and authenticity of the brand is critical. At the same time, don’t allow the perfect to be the enemy of the good. Testing is important and it’s worth sacrificing a little bit maybe of consistency or authenticity to get enough testing so that you can experiment with new types of messages and evolve your marketing. If you’re super consistent, then essentially you are not trying hard enough to figure out what works and what doesn’t work.
I love how you said that. Sometimes we are our own worst enemies, and so you got to move quickly. Consumers are evolving faster than ever before and you can’t be afraid to test.
That’s exciting. I’m very excited about bringing direct mail into the 2020s and making it a digital channel where you can experiment, test, measure, improve, and click like you could do your social media marketing and other marketing channels and email. If people would like to learn more about this new age of direct mail that you are ushering in and they want to engage with you or your team, where should they go?
We follow our own advice here, and so we are always trying to produce better and more formal content on our website. It’s a constant work in progress. Lots of great information about our company but more importantly, on case studies and how brands are using the channel and succeeding are at Postie.com. It’s always great to talk with savvy marketers and brands. I can be found most easily on LinkedIn, Dave L. Fink is my handle. If you look for Dave Fink and Postie, I will pop up. LinkedIn Messenger is a great way to communicate.
Check out Postie and how to send direct mail in the current era. I’m going to test it as well again. If you like a custom operating system for your business, be sure to check out StevePreda.com, which is my website. You can find some book downloads and other goodies. Thank you for coming to the show. Dave Fink, the CEO and Cofounder of Postie, thanks for coming and sharing your inventions in the direct mail space.
Thanks for having me. It’s always great to talk to a fellow marketer who understands this content at a very deep level.