Summary
This video critically evaluates the effectiveness of direct mail marketing, particularly in contemporary contexts, contrasting it with modern psychographically targeted digital marketing methods. The speaker argues that direct mail has become largely ineffective due to its reliance on demographic targeting, which fails to align with the psychological intent and readiness of potential customers. They advocate for leveraging online platforms like Google and Meta (Facebook/Instagram) that enable psychographic and intent-based targeting, resulting in significantly better cost-efficiency and conversion rates.
Key Insights
- Direct Mail Targeting Limitations
- Direct mail targets audiences based on demographics such as neighborhood, income, or address.
- This approach ignores the psychological state or intent of the audience, leading to poor alignment with potential customers’ needs.
- Most recipients are not ready or willing to act, making direct mail wasteful and intrusive, eroding goodwill.
- Historical Context of Direct Mail
- Previously effective when demographic targeting was a breakthrough improvement over broad advertising like billboards.
- Marketing legends (e.g., Dan S. Kennedy, David Ogilvy) popularized sales letters and direct mail as gold standards before psychographic targeting emerged.
- Psychographic Targeting Advantage
- Modern digital platforms analyze user intent and behavior (e.g., Google searches for “best dentist near me”).
- This allows for targeting individuals at specific stages of their decision journey, enhancing relevance and conversion probability.
- Psychographic targeting dramatically reduces wasted ad spend.
- Personal and Client Experiences
- The speaker’s own test with direct mail (approx. 500 mailers, $500 budget) yielded about 0.25 conversions, effectively zero actual customers.
- Scaling this, it would cost around $2,000 to acquire one customer via direct mail.
- By contrast, Facebook ads cost about $30 per acquisition, making digital marketing over 60 times more cost-effective.
- A client abandoned direct mail after poor results despite working with an established company.
- Billboard advertising and other traditional methods also underperformed compared to digital marketing.
- Challenges with Large, Established Marketing Firms
- Large companies often resist adopting new marketing strategies due to entrenched processes and organizational inertia.
- Examples include agencies advising outdated SEO tactics that no longer work effectively, especially with AI-generated content saturating the web.
- Longevity of a method or company does not guarantee current effectiveness.
- What Works Today: Psychographic Targeting & Paid Advertising
- Platforms like Google and Meta allow advertisers to target based on user intent and behavior, offering scalable acquisition.
- Google excels at capturing high-intent prospects via search queries.
- Meta platforms enable cost-effective retargeting by showing ads to users who have already visited your site, lowering acquisition costs further.
- Solely relying on one platform is suboptimal; a combined strategy leveraging both Google and Meta yields better results.
- Organic Methods and Their Limitations
- Free strategies such as local SEO, Google Business Profiles, and social media presence provide limited scale and eventually hit a ceiling.
- Platforms have become pay-to-play environments, so paid advertising is often necessary to grow significantly.
- Becoming “Remarkable”
- The speaker emphasizes building an outstanding practice that naturally attracts word-of-mouth referrals — a powerful organic growth method amplified by modern communication tools.
- Lower communication barriers today allow each satisfied customer to act as a personal marketing channel.
Timeline Table of Key Points
| Timecode | Topic | Summary |
|---|---|---|
| 00:00:00–00:01:42 | Introduction & Direct Mail Targeting | Direct mail targets demographics, unlike psychographic digital methods. |
| 00:01:42–00:03:48 | Historical Effectiveness of Direct Mail | Worked previously due to demographic targeting advances; now outdated. |
| 00:03:48–00:06:02 | Personal and Client Experiences | Direct mail had very poor conversion rates; digital marketing far more efficient. |
| 00:06:02–00:08:39 | Large Organizations & Resistance to Change | Big firms tend to stick with outdated methods due to internal resistance. |
| 00:08:39–00:11:51 | Outdated SEO & Marketing Advice | Some consultancies recommend outdated SEO, ignoring modern realities. |
| 00:11:51–00:15:04 | Psychographic Targeting & Paid Advertising | Google & Meta combined provide best targeting and acquisition cost. |
| 00:15:04–00:16:41 | Organic Growth & Becoming Remarkable | Word of mouth and remarkable service remain essential for organic scale. |
Comparative Table: Direct Mail vs. Digital Marketing (Facebook Ads)
| Metric | Direct Mail | Facebook Ads (Digital Marketing) |
|---|---|---|
| Targeting Method | Demographic (address, income) | Psychographic (user intent and behavior) |
| Conversion Rate | ~0.05% (0.25/500) | Much higher (cost per acquisition ~$30) |
| Cost per Acquisition | ~$2,000 (estimated) | ~$30 |
| Scalability | Limited, expensive | High, cost-effective |
| Audience Readiness | Low (random recipients) | High (targeted based on intent) |
| Impact on Brand | Can erode goodwill | Builds trust when targeted properly |
Core Concepts
- Demographic Targeting: Grouping audiences based on static traits like age, income, or location.
- Psychographic Targeting: Grouping audiences based on psychological factors such as intent, beliefs, interests, and readiness to act.
- Intent-Based Marketing: Targeting users based on active signals indicating readiness to purchase or engage.
- Pay-to-Play Environment: Digital platforms prioritize paid advertising for visibility and growth.
- Remarkability: Creating an exceptional customer experience that naturally drives word-of-mouth growth.
Conclusion
Direct mail marketing is outdated and ineffective today primarily because it targets audiences demographically without considering their intent or psychological readiness. Modern digital marketing platforms like Google and Meta provide psychographic targeting that aligns closely with user intent, offering dramatically better conversion rates and cost efficiencies. While organic marketing methods have some value, scalable growth in current environments almost always requires paid advertising combined with strategic retargeting. Businesses should be cautious about relying on legacy marketing advice from large, entrenched firms and instead focus on principles of intent-based marketing and becoming truly remarkable to leverage word-of-mouth at scale.
Keywords
- Direct Mail
- Psychographic Targeting
- Demographic Targeting
- User Intent
- Digital Marketing
- Google Ads
- Facebook Ads / Meta Ads
- Conversion Rate
- Cost per Acquisition
- SEO (Search Engine Optimization)
- Word of Mouth
- Remarkability
- Marketing Strategy
- Pay-to-Play Environment
00:00:00
Hey, today I want to talk very briefly on direct mail on whether it’s effective or not, whether you’re considering it or whether you are already doing it. I want to talk a bit about why I would recommend that you choose something else. And I’ll give my recommendation of what that is towards the end of the video. But first, let’s start with direct mail. The reason that I don’t think it works so well comes down to how direct mail targets. Well, I should say that the reason I know it doesn’t work
00:00:27
so well is that it comes down to how it targets the audience that you seek to target. Where modern methods, the methods of online platforms, Google, Meta, etc. can target psychographically based on how the user or what the user’s intent is or what they believe or what they’re thinking. Direct mail relies on targeting demographically. It targets by neighborhood. It targets by income. It targets by address. And that mismatch right there is the cause of all the issues that come with direct mail. And in the past, direct
00:01:04
mail worked very well. It was the way to sell stuff because it was the only way and it was a big leap before where you had complete broad advertising with billboards and such. But direct mail gave us a way to narrow that down a bit more with demographics. So we had all these uh marketing figures come out Dan S. Kennedy um the whole idea of copywriting David Oglev these people leveraged sales letters to such a high degree that it became very successful or it was the golden standard at the time until we developed
00:01:42
psychological targeting. So when you go on Google and when you search I want a dentist near me or who is the best dentist near me there is a psychological element to what that person searched. When they search like that we can say that this person has an intent to find a dentist. We can understand their psychology a little bit more and understand at what stage of action taking in in the general terms of a patient journey what stage they’re at. Whereas if we targeted by male, we would have no idea. And so when we look at the
00:02:16
curve, look at a group of people and where they lie when it comes to their journey, their level of readiness when it comes to dentistry. Of course, if you take a random sample of people, it’s going to most of them are not going to be willing or ready to be part of or to join that journey. And that’s kind of how we’re engaging when we go to direct mail is we just like a shopen spread as many as we can and hope that it lands on someone who is willing and ready. And so a massive amount of your budget just
00:02:49
gets wasted on people who aren’t willing and ready. And for those people, how you show up is you show up as spam. You show up as someone who doesn’t respect their time and energy that they have to open an envelope or they have to look and use their attention on a postcard just to throw it away. So it actually erodess trust. It erodess goodwill with the people who aren’t aligned at the moment. And on the contrast, you don’t get that effect with psychological targeting when when you show up for
00:03:19
people who are already interested. Right? So that’s something to consider when it comes to why direct marketing or direct mail doesn’t work as well as the new age psychological psychographically targeted models. So let’s talk about my experience. Let’s talk about some of my clients experiences. Um, I recently met a woman who told me that in the past, uh, we almost had worked together, but she ended up going with a direct mail company because I was newer at the time and the direct mail
00:03:52
company was established. They’ve been doing it for a long time, which seems to be like a very common uh, misconception is that if they’ve been around a long time, it’s probably going to work better. um which I find to be doesn’t hold much weight these days as technology evolves so rapidly but she worked with them for a while and eventually stopped and because she said the results were basically zero so that was her experience and then I had my own experience when I was first starting off I didn’t really know um
00:04:27
what was best so my outlook and everyone who I tried to learn from when it came to marketing was saying that their uh their methods were the best. So, my outset was, okay, I’m going to try all of these and see which ones actually worked. So, I tried direct mail. I think we had a budget of around $500 or so, a very small budget, but enough to get a statistically significant test, enough data out there to see if it really worked. And I forget the number of houses that we were able to send it to.
00:04:55
I think it was somewhere around 500 as well. And what ended up happening was that we got um 0.25 conversions, which is like, okay, how do you get 0.25 conversions? Well, we did the math on how it typically works out for someone who comes through digital marketing because it’s much cheaper um and much more effective to get leads through digital marketing. And it would convert at we figured out all the math and we figured out okay if someone comes in here the the the probability and the statistics show that they should end up
00:05:30
or we should end up with this many people who actually buy. So 500 direct mailers came in 0.25. So technically zero people converted and the costs were about $500. So if we had to scale that up to get one person we would have to multiply it by four. 0.25* 4 equals 1. So 500 times four is about a budget of $2,000. So it will cost us about $2,000 to get a single person. Whereas the cost that it was for us to get someone on Facebook like running Facebook ads was somewhere a little around $30. So we were seeing
00:06:12
that direct mail was or the new age stuff was more cost effective by a factor of more than 60 times and this repeated across all um modern methods that we knew. This this was consistent across all of them that they were consistently beating the older methods. And we tried billboards um smaller billboards in local schools with tracking numbers so we can see how many phone calls came in. All the same data like it it’s the methods of targeting was the clear indicator was the clear differentiator of these
00:06:52
results. All right. So that was my client’s experience that was our experience. Now let’s talk about the anecdotal experience. So again, the idea and the notion that because it’s been around so long, because it’s been so established, that it should work well is a misconception today. There’s a lot of companies that have been around a long time. And what I find what I find is as that organization grows bigger and bigger because they’ve done so well, what happens is their systems get entrenched in the processes.
00:07:27
So there is a big incentive for those large companies to continue doing these same processes that they’ve always have been doing because it’s efficient and at an organizational level there is a lot of human internal resistance for change and unless they have very good like excellent leadership there’s always going to be this human desire for homeostasis and resistance to any sort of change And that kind of behavior, that natural behavior that arises in any large organization is completely
00:08:02
antithetical to the changing modern environment that is marketing now. So I’ve always seen these big organization organizations lag very hard when it comes to what are the actual methods and strategies that people should be taking. So I’ve always found large organizations to um be very I I I look at them with a lot of skepticism now when it comes to what strategies should be employed. I look at what strategies they’re doing and I see that okay that is something that used to work in the past and it’s usually at the
00:08:40
individual or small organization level where I see a lot of cutting edge stuff being developed. That said, it’s always good to rely on the principles, not necessarily the tactics. Once you rely on the principles, the tactics really solve themselves out. But anyway, the organizations, these were some large organizations, organizations like um I think I can name them. So like Allergan who are the manufacturers or of Botox, they partner with marketing agencies who serve as consultants or or consultants
00:09:15
who also hire a marketing agencies or something like that. But their essential consultancy revolves around telling private practices to do SEO which is outdated by around eight years now. Like it it is ineffective. It it’s been completely the the main strategy of SEO is content generation and backlink creation which has been overwhelmed by AI and AI content generation and pay for backlink um abuse yet this is being promoted. So, if you’ve been told to do direct mail either by a larger company who has
00:09:53
a lot of authority or by a past doctor who’s done very well with it because it it did work in the past, then that’s that’s likely why um they’re suggesting that to you. And what I’m here to say is that it’s not going to work as well as it seems. Of course, feel free to try it out. Um, yeah. And so let’s get to what actually works now, which is what I alluded to before, the idea of psychographical targeting. What are methods? How can you, what are marketing tools that let you leverage a
00:10:31
user or someone’s intent? Because it’s psychography that if you align with is a predictor of action taking. not their income, not their gender, not their not how many kids they have. Those demographic factors is a very poor indicator of how well they’ll take action. Whereas, of course, psychological indicators are a very good indicator. So, what are the platforms? And typically there’s this big debate um to long story short there’s a ton of platform there’s a ton of things that target psychologically
00:11:12
and you can leverage um all of them and you should try to leverage all of them but the ones that will let you scale the ones that will give you attention and connect you with people at will what as you need it is going to be advertising. You can do all the stuff that are free. You can do local SEO, Google business profiles, you can do social media. But the problem is that you won’t get scale. You will hit a ceiling. They will give you some level of exposure because you’re playing into their game because
00:11:42
you’re making Google’s ecosystem better by showing up as another um option for their users. Um so they’ll give you some visibility. But if you want more, if you want more patients to come at will and you want to scale up, you can’t suddenly blow that up. You can’t suddenly expand that. You can get all the reviews that you want. It’s not going to increase your visibility. So they’ve made the platforms have made it a pay-to-play environment where you just have to pay and that’s part of the part
00:12:14
of the games or you become remarkable, which is another option. Um, and if you want to be remarkable, I’ll put a link in the description, which is a course on um or it’s my course on how a dental practice can become remarkable. So, with advertising now, um there’s a big debate between okay, what is it? Is it Google or is it Facebook? Well, if you think about it, which one targets intent better? Well, Google targets intent better because users are actually searching. Whereas, how Facebook targets
00:12:42
psychographically is understanding how users engage with different types of content. So while we understand interest with Facebook, with Google, we understand what they’re looking for at that moment. Very different use cases and people are always comparing it. But you have to understand the use cases because now what you can do is you can leverage Google to find people who have high intent. You can target them and as they come onto your website, you can serve a cookie to them so that you track this browser that they’ve
00:13:15
used. When they visit your website using their browser, now you can identify that browser. So when they go to Facebook now or Meta which controls Facebook and Instagram, you can serve ads to those people who visited your website from Google. So you you identify who’s interested on Google and then you can advertise to them on meta. So the wrong approach is to only advertise on meta because you lose like you’ve lost the focus. you you stopped targeting as psychographically as you can and the other mistake is only
00:13:53
advertising on Google because the costs are high. Everyone knows about Google. Everyone is competing on Google. So what we can do is find those people, market to them uh on Facebook at a much cheaper cost. And what we see across all clients is that the cost per acquisition on Facebook and Meta is much lower. that other practices haven’t figured out how to do this process. So that’s it. If you’re looking at direct mail, understand that the main reason it’s not going to work is because
00:14:28
it’s demographically led. That other people who have worked for in the past could have great stories, but understand that this isn’t consistent with how times have changed. And if you’re looking for a way that works better, understand that there’s all these different methods, but most of the unpaid ones are going to bring you very short leverage that the only way to engage with these platforms who host the people’s attention who who where people who are interested in dentistry go to like
00:15:05
Google to find information or or where they exist perpetually on things like Instagram or Tik Tok or wherever that they’re going to make it a pay-to-play game for you to leverage the platform that they built. And the only free method left for now for you now if you want to scale organically is going to be becoming remarkable to be coming to leveraging word of mouth because word of mouth has also with modern times been infinitely scaled up that everyone today has a their own version of a megaphone that
00:15:40
communication the barriers of communication have essentially been been lowered. Think of how much it costs back then to send a letter by horse carriage, then by telegram, and now with their operators or going through phone operators and now um a simple text or an email. It’s the barriers are completely lowered. And so what you can do is leverage each person who comes into your office and hand them a microphone when you become remarkable. So that’ll be in the description. Um yeah, that’s about
00:16:11
it. Hope you found this video helpful and I’ll see you guys in the next one.