Personalization powers performance. This has been one of the primary truths of direct mail marketing for years. As early as the 1970s, savvy direct marketers would build incredibly detailed profiles of their customers based on magazine subscriptions. They’d then use these profiles to create customized campaigns and send extremely targeted offers, with fantastic results.
The world has changed since then. At that time, print was still a primary source of communication and entertainment, and most of the population was signed up for at least one or two magazines, as well as local and national newspapers. Combined, these provided an extremely detailed cross-section of someone’s interests, political leanings, and even personality.
Today, customer insights have gone digital, and magazine subscriptions have been replaced with trackers that follow our every movement online. Now, marketers have access to unprecedented levels of data that can be used to create highly personalized marketing messages across all marketing channels, both online and off.
This data allows marketers to create messages that are customized to individual users, which often blows response rates off the chart. However, in order to distribute these messages, marketers need modern, cutting-edge tools that can personalize at scale while reaching millions of customers.
In the direct mail industry, this equipment takes the form of cutting-edge digital printers, capable of printing variable data that runs at high speed to drive incredible response and return on investment.
Before this technology was available, modifying design versions was a labor- and time-intensive process that involved manual setup and costly plate and lot charges. Now you can reduce the number of versions to a minimum and add variables to achieve a more one-to-one approach, and reduce cycle times and extra fees.
As this technology becomes increasingly ubiquitous, marketers will be required to adapt, and learn to create messages that target users in a one-to-one manner. Consider this blog your kickstart. Below you’ll learn what variable data printing is, the benefits it provides to organizations of all sizes, and what you need to do to get started and avoid being left behind.
What Is Variable Data Printing?
Variable data printing—or VDP—is a form of printing that allows marketers to create personalized messages for specific individuals, at scale. It’s powered by software that can pull images, copy, or other components from a database and dynamically insert them into a direct mail design based on pre-set variables, such as gender, location, marital status, buying history, or donation history, to name just a few.
All of this happens at high speed during the printing process, which makes it possible to customize every single message, even in runs that measure in the millions. When implemented correctly, this creates a high level of personalization, which in turn leads to better marketing performance.
Use Personalization to Improve Performance by Over 1000%
It’s an old adage in the direct mail industry that personalization improves performance, but recent studies have shown that the sky is truly the limit in terms of response and ROI (Return on Investment). In fact, a study by the DMA shows that using three points of personalization or more improves response by over 1000%.
This is a statistic we sometimes hesitate to share with clients because we don’t want to overstate our case—but this is the reality today. Each company and campaign will see varying results, but imagine what your next direct mail campaign would look like if your response rates improved by even 100 or 200 percent. The return on your investment would be staggering.
Will Variable Data Printing Work for You?
Usually when our clients hear about the benefits of variable data printing, they become skeptical and say something such as, “Yes, but this won’t work for my organization,” or “Has this been tested in my industry?” The short answer is yes, it works for any company that works with direct mail regularly—and many that don’t—regardless of size, revenue, or industry.
There may not not be a public case study for every industry, but that’s often because NDAs (Non-Disclosure Agreements) prevent publicity, not because such examples don’t exist. And even when a case study doesn’t exist, that simply indicates an opportunity to gain a competitive advantage, not that VDP doesn’t work.
The reality is that anyone will respond better to a message that is highly relevant to their needs, wants, and desires. At the same time, consumers are becoming more tone deaf to mass marketing messages that don’t talk specifically to them.
As organizations are increasingly able to wrangle customer data into meaningful insights, personalization will improve across all channels—online and off. It’s just a matter of time before it’s an industry standard, and anyone who ignores the trend will be left behind.
Get Started With VDP by Running a Small Test
Fortunately, today is a fantastic time to get started with variable data printing, and it’s really not as difficult as you’d think. This technology has been around long enough to prove its value, but is still new enough to provide a significant competitive edge for many organizations, especially those in extremely competitive markets.
Now, every organization should not immediately allocate their entire budget to variable data programs, but a small, statistically significant test is a great way to start. A solid rule of thumb for most of our clients is to set aside 10% of their direct mail budget to test VDP, then let the results do the talking. Doing this allows you to see results while avoiding risks that are typically involved with trying something new and unproven in your organization.
How Much Does Variable Data Printing Cost?
One of the other more common questions we get from clients—even if they’re on board to try a test with variable data printing—is, “Won’t this increase my marketing costs?” The answer to that question is the ever-present, “It depends.”
It’s true that when compared side-by-side, a run of 100,000 pieces of highly customized variable printing pieces will be more expensive than a static run of the same volume. However, the return is almost always much higher, which more than recoups the increase in initial investment.
There are also many ways to creatively manage campaigns to make room for tests while adhering to a strict marketing budget. You can reduce frequency, use a lower-cost format, or mail to a smaller list, all as temporary measures to make room to test. Whenever our clients see the results from variable data printing, they vote to continue almost without variation. It’s just important to start.
While every situation is different, a general guideline is that a variable data campaign is on average usually 10-15% more expensive than a standard campaign of comparable volume. Just remember that this investment will come back to your business very quickly as you see the benefits of improved response.
Formatting Your Data for VDP
Once your marketing team is on board, the biggest step to getting ready for a variable data printing campaign is gathering and formatting the data for use in the campaign. For example, to create three or more points of personalization, you need at least three meaningful pieces of corresponding data for each customer, and the design variations to go with it.
Most often, you already have enough data to start a campaign, by making use of information such as gender, address, or recent purchases, but it still needs to be exported and sent to your printer in the correct format. You can also purchase pre-formatted lists, however it is best to market to current customers, who are often your best prospects for new business.
If this is something you’re still struggling with, contact us or your dedicated direct mail printer; an experienced partner will be able to help you format your data and create a campaign that works for your goals and situation.
Personalization Is the Way of the Future. Get Started Now.
When we look back in five, 10, or 15 years, it will be clear that variable data printing is more than a short-term fad. Rather, it’s a revolutionary new technology that is transforming the way we do direct mail and will continue to do so until it’s used by every major brand or company that invests regularly in direct mail.
Time is running out to get ahead of the curve, but you can still get started before the trend passes you by. It’s time to dive into your customer data, get organized, and start creating targeted, personalized messages that will excite your audience. If you have any questions or want to discuss how to get started at your company or business, fill out the form below to get in touch with one of the direct mail professionals at Design Distributors to learn the most effective techniques to leverage this game-changing technology.