Direct Mail Attribution for Cannabis Businesses
Key Takeaways
Direct mail attribution is essential for assessing the ROI of marketing efforts, especially in offline advertising mediums like direct mail campaigns.
Key metrics to measure include response rate, conversion rate, matchback analysis, cost per response, cost per conversion, and customer lifetime value.
Different attribution models such as first-touch, last-touch, linear, weighted, and revenue attribution help businesses understand the impact of their direct mail campaigns.
Prioritizing direct mail attribution empowers cannabis businesses to make data-driven decisions, optimize marketing efforts, and comply with industry regulations while maximizing advertising impact.
Introduction
Understanding your return on investment (ROI) is one of the most important tasks for any business venture. Are your marketing efforts driving efficient sales? Access to detailed response data lets you assess whether your marketing dollars are appropriately utilized and allocated. However, measuring ROI can sometimes be challenging with offline advertising mediums. Canna Direct Mail’s direct mail attribution process is your answer to this problem.
Direct mail attribution measures the effectiveness and impact of your direct mail campaign by identifying which actions or touchpoints led to purchases or conversions. This process checks whether your direct mail targeting is efficient, allowing you to optimize and adjust your future campaigns and allocate your resources effectively. This method involves tracking and analyzing your customers' responses and behaviors when they receive your direct mail, visit your website, and purchase cannabis products and services.
Understanding Direct Mail Attribution
A detailed process is needed to track your direct mail campaign results so you can easily measure the success of your campaign. Through this process, you can identify and monitor the number of people engaging and converting in your direct mail campaign. Here are the key direct mail tracking metrics that you need to measure:
Response Rate
This is the most common way to track and analyze your direct mail campaign because it is the easiest to evaluate. Studies have shown that direct mail marketing has higher response rates than other marketing channels due to its high impact, precise targeting and over 90% ad engagement rate. Direct mail ads are noticed and engaged with by your consumers. By utilizing QR codes, barcodes or unique urls you can track traffic to your website and/or loyalty program or scan mailers in the store. To measure the response rate, divide the number of mailers you sent by the number of responses you received. If you sent 10,000 pieces of direct mail and you received 4000 responses, your response rate is 40%.
Here's the sample computation: 4000 / 10,000 = .4 or 40.00%
Conversion Rate
A strong response rate is an important metric, but it is not the sole measure of your direct mail marketing success. Conversion rates provide deeper insight into the effectiveness of your direct mail campaign. Conversion rates measure the recipients who take a desired action after engaging with your marketing campaign, such as purchasing.
Let's say that 800 customers out of the 1000 responders decide to pay for your product and service. To determine your conversion rate, you divide the number of prospects who converted by the responses you received to your initial mailing:
800 conversions / 1000 responses = 0.80 or 80%
Matchback Analysis
Matchback analysis is the most accurate method of measuring your direct mail campaign performance. It involves comparing your actual customers during a period of time to the direct mail send list. Through Canna Direct Mail’s matchback process you are able to securely share first party data and track actual customers to people who received the mailing. If you don’t track customers’ addresses, and only have names, we are able to do address matching on those customers. We are also able to examine certain types of customers, such as customers with the largest basket size, and build custom lists with lookalike lists (customers that look like your best performing customers) off this top performing customer segment.
Cost per response and cost per conversion
It is essential to track the cost per customer acquisition costs during a direct mail campaign. How much does it cost to bring each customer through the doors?
The formula to track the cost per client acquisition is the following; you divide the number of customers converting to the direct mail campaign by the cost of the campaign. For example, if 1000 customers convert for a campaign that costs $6,000 the cost per client acquisition or cost per action (CPA) is $6 ($6000/1000=$6).
By utilizing Canna Direct Mail for your cannabis or Ketamine clinic direct mail marketing needs you are able to take advantage of our extremely low printing costs, high performing targeted and exclusive lists, and best in class approaches to lower postage costs. This allows you to mail at efficient costs and generate high conversion rates which in turn leads to high performing campaigns and low cost per client acquisition costs.
Customer Lifetime Value
One of the most important metrics to track is the Customer Lifetime Value (CLV). CLV is the total revenue a customer brings to your business over time. You can optimize and refine your marketing strategies by analyzing lifetime value to emphasize long-term and sustained relationships. Not all customers are created equal and we can help you drive the most revenue by reaching customers who will remain loyal and generate large basket sizes.
How to measure direct mail attribution for Cannabis Industry
Utilizing Canna Direct Mail’s targeted approach to direct mail will drive strong results to your cannabis business. To check for the effectiveness of your direct mail campaign, you need to look into these few attribution models that you can utilize. Here is your guide to direct mail attribution models:
First-Touch Attribution
The first-touch attribution model credits all conversions to the direct mail copy that was first sent to the customer. This model operates on the premise that the first contact has the most significant influence on the conversion. This model proves valuable for campaigns focused on prospecting and customer acquisition.
Last-Touch Attribution
The last-touch attribution model credits the conversion to the last direct mail you sent to the customer. It assumes that the last piece of marketing material had the most impact, and conversion was most likely the result of the interaction.
Linear Attribution
The linear attribution model distributes credit evenly among all your advertising touchpoints. This model assumes that every advertisement or mailer copy you have sent to your client has an equal impact on the conversion.
Weighted Attribution
A weighted attribution model assigns credit to specified proportions across your advertising touchpoints, operating on the premise that each advertisement has a specific portion of impact in the conversion.
Revenue Attribution
During the run of your direct mail campaign, make sure that your revenue attribution is set up. Revenue attribution involves linking your sales to your advertising efforts, which is essential in monitoring your direct mail marketing impact. Tracking your revenue from advertising helps you identify the most effective marketing channel for your cannabis business, allowing targeted investment.
Strategies for Effective Direct Mail Attribution
Effective direct mail attribution involves implementing strategies to measure your direct mail campaigns' impact accurately. Here are the attributes of a successful direct mail:
Unique Promo Code, Barcode or Coupon. Assigning a specific promo code to your direct mail pieces or campaigns allows you to track individual responses and conversions back to specific mailings. This method helps differentiate your campaigns' performances and pinpoint the most effective ones.
Custom URL. You can include personalized URLs in your direct mail campaign which direct to a customized landing page. By creating a custom URL for your direct mail campaign, you can easily track the visits to these pages, drive customers to unique pages and attribute conversions to the unique URL.
QR Codes. Like the custom URL, you can measure the number of people who visited your website once you include a unique QR code in the direct mail copy you send. QR codes can also be used to turn any mailer into an augmented reality interactive piece.
Call Tracking. Setting up a dedicated phone number tied to your direct mail campaign allows you to track incoming calls from people who received the direct mail copy. This method lets you attribute conversions directly to specific mailings.
Integration to the CRM Systems. You must integrate your direct mail data with customer relationship management (CRM) systems to track responses and conversions alongside your other marketing channels. This approach lets you assess the total impact of your marketing efforts, regardless if customers use coupons, and adjust your direct mail tactics as necessary.
Future Trends in Cannabis Direct Mail Attribution
Direct mail attribution in the cannabis sector has limitless potential thanks to the ever-evolving strategies tailored to its unique landscape. As the industry matures and regulations evolve, the cannabis industry realizes the importance of using direct mail to reach the audience. However, accurately measuring the impact of direct mail marketing on your cannabis business requires an experienced direct mail agency, such as Canna Direct Mail.
Technological advancements are expected to significantly impact the cannabis industry's development of direct mail attribution. Cutting-edge solutions like blockchain-based tracking systems and AI analytics platforms will make tracking and analyzing responses efficient and turnkey.
Personalized direct mail efforts that cater to individual preferences and buying patterns will become standard. Cannabis businesses will produce highly targeted mailings that resonate with each consumer, driving engagement and conversions through data and segmentation techniques. Furthermore, connection with CRM and digital marketing channels will facilitate smooth monitoring and attribution across several touchpoints. Canna Direct Mail is at the forefront of all of these technological advances and you can trust that you are in good hands when you select us as your partner.
Conclusion
In the complicated landscape of the cannabis industry, direct mail attribution is crucial for your business to measure and optimize its marketing efforts accurately. It provides data on your customers' behavior and campaign performance, creating more opportunities to improve ROI and reach the precise audience that is most likely to be your actual customers. Understanding which marketing initiatives drive conversions allows you to allocate your budget effectively and customize your brand messaging. In addition, direct mail attribution helps you comply with the industry's strict regulations by providing transparent reporting. Through prioritizing direct mail attribution, you empower your cannabis business by making data-driven decisions and maximizing the impact of your advertising efforts.
Get in touch about our direct mail solutions today!
