What Is Direct Mail?

Direct mail is a strategy of sending advertising mail, such as pre-approved credit card applications or nonprofit fundraising letters, directly to potential consumers based on demographic information.

Key Takeaways

  • Direct mail is an advertising strategy of sending mail, such as pre-approved credit card applications or nonprofit fundraising letters, directly to potential consumers based on demographic information.
  • Many industries implement direct mail strategies to advertise their goods or services, ranging from consumer catalogs and coupon circulars to nonprofit solicitations and pre-approved credit card applications.
  • Although direct mail can have a negative reputation for being perceived as junk mail, it remains a large income stream for postal services and is effective in marketing to older generations, such as Baby Boomers or Gen X.

How Direct Mail Works

Direct mail is a form of advertising relying on printed materials and the postal service to deliver advertising appeals directly to consumers.

Relying on various forms of demographic data such as location, income, age, and political affiliation, direct mail marketers take advantage of bulk mailing rates to lower costs of distributing unsolicited advertising materials directly to potential customers.

Many industries implement direct mail strategies to advertise their goods or services, ranging from consumer catalogs and coupon circulars to nonprofit solicitations and pre-approved credit card applications. Many local businesses will employ direct mail strategies to advertise in the surrounding geographic area.

Although many may consider direct mail to be junk mail, it should not be dismissed. In spite of the nuanced reputation of direct mail, it remains a large income stream for postal services and is effective in marketing to older generations, such as Baby Boomers or Gen X. In 2019, the United States Postal Service delivered 143 billion pieces of mail.

As subscriptions and online packages have reinvigorated the mail industry, direct mail marketers also anticipate incremental growth in the industry in the coming years, especially as strategic analysis and increased availability of demographic data help to increase return on investment of direct mail.

Direct Mail and Pre-Approved Credit Card Offers

Even with the ubiquity of direct mail and its compromised reputation with recipients, pre-approved credit card offers remain a popular strategy for the credit card industry to reach new customers.

Credit card companies are able to offer pre-approved credit card applications to potential new customers by running soft credit checks and building mailing lists from customers above a predetermined credit score.

The direct mail approach to sending pre-approved credit card offers remains an attractive strategy for many companies because of the permanence of physical mail, which tends to have a higher rate of engagement than electronic advertising. Marketers often increase engagement with pre-approved credit card offers by including sample credit cards and special perks, including reward programs and special annual percentage rates.

A customer who responds to a pre-approved credit card must still apply and the offer may be declined if information in their credit report has changed. As with all such transactions, customers are expected to read and understand the terms and conditions which accompany such offers.

It is recommended that recipients who decline to apply for pre-approved credit cards shred the mail before disposal, as these offers have sometimes left consumers vulnerable to identity theft. While credit card companies have established many strategies to minimize identity theft, and victims are not liable for fraudulent transactions, responding to identity theft can be an annoying and complicated inconvenience for all parties involved.