You do the math

JICMAIL notes with keen interest the response published to our mail attention report – The Time We Spend With Mail – and in particular to the attention cost-efficiency chart kindly shared by the folks at Magic Numbers on Linkedin earlier this week.

The calculations in the response are obviously inconsistent with our own view, and for full transparency I have provided our own calculations below. The rates used in the response work with a cost-per-item of 32p, sourced from Royal Mail’s published business rates here. The same page on the Royal Mail website states that costs can in fact be as low as 25p per item, and at the time the calculations in our attention report were made, this figure was as low as 20p per item.

In addition, the response uses an estimated open rate of 50% for Direct Mail. Not only is the average open rate published by JICMAIL in fact 74%, but the opening of mail is only one of ten physical mail interactions that we measure, and only one way of delivering an ad impression. With ad mail invariably containing advertiser branding on the outside of the envelope, direct mail can deliver a meaningful impression even before it is opened. It is therefore not necessary to factor open rates in to the cost equation.

In addition the statement that “… direct mail costs 64p/1.2p = 53x as much per contact as TV” is not making an apples to apples comparison: it compares a mail item to a TV ad impression. Mail is typically interacted with 4.5 times over the course of month, and therefore 1 mail item equates to 4.5 impressions. Using a rate of 20p per mail item, the impression to impression comparison is in fact closer to 4.4p vs 1.2p = 3.6x higher.

For the TV attention data, we have used the publicly available data published by Mark Ritson, sourced to TV Vision, stating that a 30 second TV is viewed for 13.8 second on average. JICMAIL’s attention data employs a different methodology, relying on self-reported panellist data cross-referenced and verified with observed data through an in-home video analytics exercise. From a practical point of view it is not possible to get one thousand households a month to continuously wear eye-tracking kit, so we have had to carve our own path in this respect. All of the different media channels and their corresponding JICs employ different methodologies to measure reach, frequency and audience exposure and the measurement of attention is no different. Good media planners should be aware of the methodological differences so that they are able to make informed comparisons on their media schedules. The IPA’s excellent Signals in the Noise paper provides useful guidance on what to look out for in your media measurement sources.

Also, like the other JICs, JICMAIL does not just represent the sell-side of the channel. Our board includes representatives from the buy-side through the IPA and ISBA and we are here to provide trusted, transparent planning and measurement metrics for the entire eco-system, not simply those who sell mail.

We do take the point that these calculations will look different when viewed through an All Adult lens, but the highly targetable nature of mail to an upmarket audience is the point that we are demonstrating. Yes lots of other people in the room will see your TV ad, but we also see the same effect with mail. Mail is shared in the home and often looked at by more than just the addressee. On average a direct mail item is seen by 1.12 people per household.

JICMAIL’s intention with this work was not to pitch one media against another. Moreover, in the context of the attention economy it was designed to dispel the myth that mail is an expensive channel. Mail can in fact be as attention efficient as any other channel. We believe in the merits of a fully integrated campaign plan, with each channel bringing its own strengths to the media mix, and we encourage planners to use our data as such, while employing tools like IPA Touchpoints to explore the role that mail can play in a multi-channel campaign.

We welcome the debate prompted by the publication of our report, a debate that we took to a roundtable of agencies and advertisers recently as they discussed the implications of our research. The resulting JICMAIL Attention Manifesto can be found here.

The JICMAIL attention cost-efficiency calculations have been verified by PWC and are as follows:

For Direct Mail -

• Using a cost-per-item of 20p, it costs ￡200k to send 1 million direct mail items to ABC1 Adults.
• Across a 28 day period, the average piece of mail is viewed for 108 seconds.
• 1 million mail items therefore generate 108 million seconds / 1.8 million minutes of attention.
• ￡200k divided by 1.8 million minutes = a cost per minute of 11p.

For TV -

• Using a CPM of ￡19.76 for ABC1 Adults (a rate provided by The Kite Factory agency) it costs ￡19,760 to deliver 1,000,000 TV impressions
• TV Vision data suggests that a 30 second TV ad is viewed for 13.8 seconds on average.
• 1,000,000 impressions therefore deliver 13,800,000 seconds / 230,000 minutes of attention.
• ￡19,760 divided by 230,000 minutes = a cost per minute of 9p