Comparison Of Response Vs. Compiled Mailing Lists
Two types of mailing lists are available to the direct marketer:
1. Response lists are those where the person on list bought something via direct mail, such as a publication, association membership, or attendance at a seminar.
2. Compiled lists are similar to telephone book white pages or a directory. You know the person or business exists, but there's no proof that they've responded to any direct mail offers.
The best way to measure the effectiveness of mailing lists is to compare the return on investment achieved by mailing to each list. Return on investment is most broadly defined as "total revenue produced by list divided by total cost of mailing to the list".
Reasons to use a response mailing list:
* One of the first things a successful list broker learns is that 1 out of 3 Americans will never buy anything via direct mail. So by focusing on response lists which contain only proven direct mail buyers, you can typically generate 50% more orders than mailing to a compiled list.
* Some marketers make the mistake of avoiding response lists because they cost more than compiled lists. But the increased cost only applies to the list portion of your total marketing costs. The postage, printing and mail processing costs are same for all types of lists.
Reasons to use a compiled mailing list:
* Compiled lists work just as well as response lists for your offer.
* You need detailed demographic selects for targeting which you can't find on the response lists in your market segment.
* You need to do telemarketing, and can't get phone numbers from your response list sources.
* You want to create your own prospecting database for repeat use.