Many small business owners want to use direct mail as part of their marketing mix, but they’re not sure how to get a mailing list. The best mailing lists are the ones the business itself owns, called house files. These lists, usually compiled from customers who have purchased products or services from the business in the past, are great to promote sales or new products to loyal customers. But what if you want to generate new sales and acquire new customers? You must rent a mailing list.

Lists Are Rented, Not Purchased (You Don’t Own the List)

Lists are rented, not purchased. Many marketers and business owners talk about buying lists, but lists are usually rented for specific uses. They may be rented for one time use, which means that only one mailing can be sent to the addresses on the list, or they can be rented for unlimited use. Unlimited use is something of a misnomer, as there may be boundaries around the usage.

For example, depending on the fine print in the contract, unlimited use may mean that you can continue using the list for as long as you want to or it may mean that you can mail to the list as many times as you want to during a discrete time period, such as within one year.

What Is a List Broker?

Companies that rent lists are called list brokers. Using the analogy of renting an apartment, a list broker is like a real estate agent. If you were searching for a one bedroom apartment with a balcony, a real estate broker would generate a list of potential apartments in your price range for you to see. List brokers perform a similar function.

After learning about your mailing and possibly reviewing a sample mail piece, they may ask you questions about the target audience. They may want to know what you intend to sell, or more about the customers you’d like to reach. These questions help brokers narrow down the choices and provide you with the best possible lists for your needs.

Types of Direct Mail Lists

There are two basic types of direct mail lists. Compiled lists are the least expensive, but tend to be the least effective. Companies compile customer data and mailing addresses from public documents, such as telephone directories, to create lists based on zip codes. Usually, little or no data on the customers on the mailing list is available beyond basic census data.

Response List vs. Compiled Lists

Response lists usually perform better than compiled lists, but they are also more expensive to rent or lease. Response lists may be based upon lists of magazine subscribers, catalog purchasers, or people who have in the past responded to a direct mail offer. Many response lists offer renters additional data points for consideration, such as the last time customers purchased something, information on what they purchased and other facts.

These can help you target the best possible recipients for your direct mail offer.

When Was the  List Cleaned?

Like an apartment, a list needs to be cleaned. List hygiene includes the last time the list was updated, the last time it was checked against the post office’s change of address files, and whether or not it has been checked against the file of deceased persons. Such tasks can reduce the number of nixies, or returned direct mail pieces that are returned because they are undeliverable.

If the list broker cannot perform these tasks, a mailing house or printer who handles direct mail can typically provide the services or help you find a local vendor who can.

Removing bad addresses from the list saves postage, printing and mailing costs. It also enhances good will. Nobody likes getting mail addressed to a family member who died!

How to Choose the Best List

Be choosy about where you rent your mailing lists. Old mailing lists are not only more likely to be undeliverable, but they may also be beyond the original terms of the lease agreement. Direct mail companies do track the usage of their lists by using something called a seed file or seed addresses. These are a few addresses seeded or sprinkled throughout the list of employees or subcontractors of the mailing list owner who get a copy of every direct mail piece sent to the list file.

You can’t tell at a glance who those people are; their addresses look like anyone else’s. They will, however, check mail they receive against approved use of the list, and if a list is used outside the scope of an agreement, expect a bill in the mail from the list company.

Direct Mail Works

Renting mailing lists is an art and a science. It’s always smart if this is your first time choosing a mailing list to speak with a professional direct marketer and seek their advice. Direct mail offers a powerful, measurable method of acquiring new customers. Direct mail may be an older market method, but it remains a vital and powerful one when used correctly.