Direct mail has long been a vital communication channel for financial services. It is used to engage with customers and prospects on everything from information about fluctuating interest rates to new loan and mortgage products. Its popularity is backed by research from the Direct Marketing Association (DMA), revealing that approximately 70% of all banks and credit unions use direct mail, with 35% planning to increase their use.
Why direct mail is poised to become the number one communication channel in 2022
Direct mail spending is holding up well despite the growth of digital channels offering low-cost methods for financial services players to communicate with their audiences. The plethora of digital channels – from email to social media and content – makes it difficult to generate cuts. With consumers spending more time on their screens at home, especially during the pandemic, people are becoming numb to messages in the digital space.
It’s also important to remember that some people still can’t communicate digitally. They may struggle with online communications. Or maybe they are not connected to the internet at all.
Recent research from JICMAIL reveals the value of direct mail. They found that 96% of people were engaged in direct mail in the second quarter of 2020, compared to 91% in the same quarter of 2019. A good email open rate is between 10 and 20%, but average rates opening times for emails can vary enormously. .
Direct mail is important for banks (and all industries, for that matter) because it provides a strong physical presence on the doormat. Your audience can’t avoid it. It is also possible to be very creative with direct mail, because the size of a screen is not a constraint. Finally, direct mail can reinforce messages as part of a more comprehensive communication campaign on other media channels.
If targeted accurately, direct mail helps generate a strong response, whether it’s going online and filling out a form, making a purchase, or taking some other brand-friendly action. .
Obtaining accurate address data is essential for direct mail success
Inaccurate address data is the biggest obstacle to delivering effective direct mail campaigns. Without constant attention, the data quality of a database will decline. Contact data is degrading at a rate of 2% per month, with 25% of data being corrupted each year as people change residence (2.2 million people move to the UK each year), get new phone numbers mobile phone or die. Correcting this erroneous data has significant time and cost implications, with an average of 2% of an organization’s revenue lost by changing it. It’s time and money that could definitely be better spent.
Another problem in the mobile age is the growing reliance on user-supplied data, which leads to an increase in inaccurate data collection at the customer onboarding stage. Those who enter their contact information on a small screen are much more likely to make a typing error; this is often referred to as “fat finger syndrome”. It’s no surprise that around 20% of addresses entered online contain errors, such as misspellings, wrong house numbers and incorrect postcodes.
Address verification and research ensures accuracy
Address verification and lookup tools will play a vital role in ensuring address data is accurate in 2022. These automatically reveal the suggested correct version of the address when the user completes a contact form in line, allowing them to select one that is not only accurate but easily recognizable and correctly formatted for their country. These tools also negate the cost of later data correction. Additionally, an address search tool reduces the number of keystrokes required by up to 81% when entering an address on a small mobile screen, improving the user experience.
In the UK, the address verification service used must have access to the Royal Mail’s Postcode Address File (PAF) and be able to enrich the data by filling in gaps such as a missing postcode. It should also provide geocodes that facilitate accurate delivery and improve user experience. Finally, it must be able to correct and enrich users’ address data a posteriori.
Durability and identity verification
It should be emphasized that ensuring the accuracy of verified addresses will reduce carbon emissions resulting from the production and delivery of misaddressed mail that will be returned, helping financial services players achieve their sustainability goals. Additionally, having accurate addresses will help with identity verification and prevent fraud.
Direct mail is expected to remain the go-to communication channel for financial services players in 2022 due to its wide range of benefits, such as showcasing in a digital world and driving engagement. However, it is only by taking steps to obtain verified address data that players in this industry will improve the accuracy of their address data held. This will increase engagement with their direct mail campaigns, reduce the cost of misdeliveries and their impact on the environment, and reduce opportunities for fraud.