Direct Mail Coupons Leave a Lasting Impression on the Neighborhood

Published by Allan Adler

Date April 2, 2012

Coupons have been around for decades as businesses try to entice consumers to frequent their establishments and utilize their products and services.

Several online companies have taken the customer’s desire for a bargain to a higher level and have revived interest in coupons, thus drawing in more business.

But businesses are discovering that this high-tech approach has some drawbacks. Although online couponing results in new, initial foot traffic, it often doesn’t retain customers in the way direct mail coupons have proven they can time and again. In addition, online couponing frequently fails to reach all of the potential customers in a specific area.

“We hear from so many local retailers that the daily deal sites are creating heavy traffic but no one is returning and becoming loyal to the local business running the deal,” says Brian Mattingly, director of franchising for Welcomemat Services. “These deal-driven consumers are not loyal to any business and will respond only to the next best deal.”

Welcomemat Services — a national company based in Atlanta, Ga., that sends out direct mail coupons to new residents in a community — maintains that the ability to target specific areas or regions with direct mail gives businesses a better chance of winning the long-term loyalty of customers.

This definitely helps a bottom line, Mattingly notes. One of his customers reported turning a $2,000 investment into new revenue of $83,000. Based on those individuals becoming loyal, the business expects to have the customers bring in a generous return on the company’s expenditures for at least the next few years.

Mattingly says a tavern owner in Atlanta spends $200 a month contacting new customers through direct mail and has a whopping 25% retention rate. The philosophy is simple: To be a neighborhood bar, you need to reach out to the people who move into the neighborhood. This is done best by specifically targeting the people in the business’s ZIP Code.

Direct mail also helps public institutions, which are constantly trying to attract new patrons. Many send coupons through mail to lure people.

A botanical garden reported that response to its coupons has grown annually. The number of responses varied from year to year but has continually increased, from about 400 people several years ago to 600 in 2011.

Businesses looking to build customer relationships and long-term loyalty should stick with creating direct mail coupon campaigns over daily deal web sites.