The $40B Mailbox: Unleashing Automation and Technology on Direct Mail w/ Dennis Kelly, CEO of Postalytics

Tim Rowe (00:00:01) - Dennis Kelly, thank you so much for being here. I've got a list of questions a mile long, uh, and I'm excited to dive in, but thank you for making time to, to be a part of the conversation.

Dennis Kelly (00:00:11) - Hey, Tim, this is great. I'm psyched to speak with you today and, uh, and, and, uh, get in front of your audience

Tim Rowe (00:00:17) - For sure. It was funny when we first connected it was, it was, I think the initial question was, you know, what, what conversation can we have about billboards in direct mail? And there's a lot there. Uh, and I'm excited to unpack that with you. And one of the things that I'm really most excited about in this conversation is to walk through a little bit of your own journey to being where you are now as c e o at post Alytics, and specifically double click into some of the challenges of bringing legacy pen and paper industries, direct mail, a 40 billion industry, as I learned in that first conversation. So similar in ways to the, the industry that we're in here of, out of home, and how do you solve that through automation. How do you introduce to, how do you introduce technology to maybe make what's old new again? And, and doing all of that while not disrupting, you know, maybe some of the incumbent place or placeholders, stakeholders are gonna come out and come back and may without disrupting some of the incumbent stakeholders in this. Um, really looking forward to, to that part of the conversation. But Dennis, how did you, how'd you get started? You are a serial entrepreneur. How did you get started in business?

Dennis Kelly (00:01:29) - Well, uh, you know, I, I guess I'll, I'll go back to the, to the, the founding story of me. Uh, I, I was, I was raised on a farm in upstate New York. And, um, when, when you, when you live on a farm, uh, you, you learn about work, uh, really quickly. And, and so, um, you know, I, I spent, uh, a a lot of my, uh, early development years working really hard on a family farm. And, uh, you know, my parents really encouraged me to go make a buck any way I could. And so, you know, when I wasn't working on the farm, I was mowing the lawns and shoveling snow, a lot of snow in upstate New York to shovel ,

Tim Rowe  (00:02:12) - I bet there is

Dennis Kelly (00:02:13) - , uh, washing cars. Uh, you know, I always had, uh, some sort of gig going and, and my parents really pushed me and, and, and said, Hey, if you want some money in your pocket, go earn it. Um, and, and so at a young age, I kinda got that reinforcement. I did a couple of, uh, entrepreneurial things in college where I was, uh, I, I had, uh, connected up with a, a guy that had promotional stuff. Uh, and, um, uh, I, I, I played football, uh, in college. Okay.

Tim Rowe (00:02:47) - , where'd you go to college?

Dennis Kelly (00:02:48) - Uh, I went to Colgate in upstate New York.

Tim Rowe  (00:02:50) - Oh, sure. Yeah, of course.

Dennis Kelly (00:02:52) - So, um, so I, I, you know, I was a player, so I couldn't, I couldn't run around and sell stuff at, at the games, but I had this guy that I knew from my hometown that he, he was able to like, make all this promotional stuff,

Tim Rowe  (00:03:07) - Okay.

Dennis Kelly (00:03:07) - Banners and, and wind sox and like all this stuff, right? This

Tim Rowe  (00:03:11) - Is way before n i l deals were getting signed. Unfortunately, Dennis missed out on, on the opportunity to stick

Dennis Kelly (00:03:17) - Cash in. So, so I ended up, I, I ended up getting a, a guy that I knew to be my rep, my sales rep, and I was kind of the broker. And so he would, he would run around in the tailgate and, and outside the, the bounds of the, of the stadium where he could actually sell some stuff. And he, he had like all this stuff that we had printed and, and all this promotional material for Colgate football and demo.

Tim Rowe (00:03:42) - I'm sure there's no, there's no licensing deal involved here. These are not,

Dennis Kelly (00:03:46) - And, and I'm sure, I'm sure there are several NCA rules broken by that  my involvement, right? So I can talk about it now 35 years later. It's fine.

Tim Rowe (00:03:56) - His statute of limitations has since expired, I think .

Dennis Kelly (00:04:00) - So, you know, I, I kind of had that bug early and I, and I went to work at a, at, at Prudential, uh, corporation, you know, massive insurance company and had a great training program. Uh, but after a couple of years I was just choking, right? And I needed to go do something. So, uh, you know, a buddy of mine from college and his brother were starting a computer company, uh, in the late 1980s. Uh, and they, they needed a sales guy. So I jumped in and I was the original sales guy, and, uh, that kind of got me started in the whole, you know, tech startup world. And, and so, uh,

Tim Rowe (00:04:35) - OG as, as the kids would call it, I think you are og OG to this

Dennis Kelly (00:04:40) - Big time. So this is my sixth startup and, um, uh, you know, having a ball and, and you know, this, this came about pu list came about really, uh, from, from my partner in this who's a, a technology guy that I've worked with a couple of times in the past. And, and he and I got together a few years ago. He had this little side gig he was working on because, you know, every brilliant engineer can build something better than what's on the market. And, uh, it, it, it involved direct mail. And, and what kind of fascinated me about that is that, you know, as you mentioned in the beginning, direct mail's this huge legacy marketing channel, 40 billion a year annual US spend, and nobody in the tech world is paying any attention to it, right? So

Tim Rowe (00:05:25) - Interesting. Sleeping giant. Yeah.

Dennis Kelly (00:05:27) - Sounds like an opportunity, right? So

Tim Rowe (00:05:29) - Sounds like an opportunity,

Dennis Kelly (00:05:31) - . So here we are and, and, uh, and now it's, uh, you know, we're, we're growing like crazy and, uh, knock on wood, we'll, uh, continue to, uh, stay on our current path.

Tim Rowe (00:05:42) - And obviously direct mail has been around for a long, long time, but what about the dynamics changed that made now a specifically interesting time to, to focus on solving that problem?

Dennis Kelly (00:05:55) - Yeah. Yeah. So there, there are a things that I think have really come together, um, that at, at, at a macro level. Uh, and, and so, um, you know, from a a marketing perspective, uh, you know, I think everybody's aware that, you know, direct mail as a marketing channel was, was really primary for a lot of kind of businesses for a good 30 year period. And, and, and sort of peaking and starting to kind of go downhill in the early two thousands. And, and so, uh, in its place, uh, came email marketing and, you know, social media and, and digital marketing and, and like just about every other marketing channel, um, those channels produced massive returns in their earlier years mm-hmm. . And then as soon as anything works in marketing, the whole world is

Tim Rowe (00:06:58) - We ruin it. We just ruin it. , it's, it's really a problem. We .

Dennis Kelly (00:07:03) - Yeah. So, so you know, what's happened over with email over the last 15 years, really, uh, and with digital on the last five, the, the costs of customer acquisition has been rising rapidly. Uh, email open rates are on a long-term steady decline over time. Uh, the average American gets, um, you know, between, uh, 103 hundred emails a day, and I believe

Tim Rowe (00:07:35) - That .

Dennis Kelly (00:07:37) - And so, you know, it is just overwhelming. And, and so, you know, if you're a marketer, how do you stand out? How do you differentiate yourself from everybody else who's following the exact same email and digital playbook, right? So that's, that's one big thing. Second big thing is really the, the, the notion of having a, a centralized repository of sales and marketing data in, you know, c r m and marketing automation tools and the whole like, explosion of the marketing tech stack, right? So, so you've got all this investment in marketing tech, you've got declining ability to break through the noise to reach people, and, and then you got this old legacy marketing channel out here, right? That, that when you look at the data, the data says that it's a very high r ROI marketing channel.

Tim Rowe (00:08:42) - It's just not sexy.

Dennis Kelly (00:08:44) - It's just, it's not sexy, it's hard to do. The people that are good at it are, uh, aging out of, of the workforce. Uh, and, and so, you know, how how do we solve that problem? And, and, and so that's really where the, the opening came here to say, Hey, let's take the best practices of the people that know what the heck they're doing, code that up in software and, and, and tie together with that massive investment in marketing tech so that, you know, you could, with a fraction of the time and effort, uh, to do a direct mail campaign, start using direct mail to augment that marketing tech investment, augment your email, augment, augment your digital right, and, and make it a part of the, uh, just another channel that is leveraging the massive investment that you have made in your infrastructure.

Tim Rowe (00:09:45) - And I think we could go back and take the last two minutes and just swap out direct mail for out of home. And everything that you said, it's so, so similar in terms of it's hard to do and the, it's a very specialized knowledge set, and we've seen as an industry automation in ways attempt to streamline some of it. I'm curious from your perspective in building post alytics, what were the hardest parts of stitching together that automation flow, obviously out of home, much different. It's billboards, it's bus shelters, there's various formats and vendors and all these things, but I'm sure that doing this for direct mail came with as many of its own challenges. What were some of the, the hardest and, and most unique in doing that?

Dennis Kelly (00:10:33) - Sure, sure. So I think, you know, starting right away the fact that you are translating software cloud-based digital experience into something that is, uh, created in the physical world mm-hmm.

Tim Rowe (00:10:54) - ,

Dennis Kelly (00:10:55) - That's a thing, right? It

Tim Rowe (00:10:56) - It is a thing.

Dennis Kelly (00:10:58) - ,

Tim Rowe (00:10:58) - That is a thing. I, I've always felt like that was a thing. And you saying it right now validates me in ways that, that I can't even express. It is a thing. Yeah. It's weird to build in, in a completely, essentially virtual environment on computers, something that is tangible and experienced in the physical space.

Dennis Kelly (00:11:19) - That's right. That's right. And, and so, you know, what we've had to do is go out and find commercial printers who are willing and excited to adapt kind of a, an entirely new business model to interface with us using software that maybe they've never created before, right? Mm-hmm. , that, that, that they're dealing with APIs for the first time and instead of getting big Excel files through FTP and, and, you know, that's kind of how printers typically work and legacy direct mail is very file based. Uh, it's a very relationship oriented business where, you know, you're, you're a printer and you know all your customers and you got print salespeople that are calling on them, sitting in their office talking about paper stock and pent tone colors and all this stuff, right? And we're coming at 'em and saying, Hey guys, we, we wanna build this thing.

Dennis Kelly (00:12:24) - It's gonna just feed you an API call. And you gotta get it turned around and out the door with very high quality, you know, on a, on a daily basis. And, you know, you don't know anything else. You just, you're just seeing a, a, a, a steady stream of postcards and letters and self mailers from customers all over the country, all over the world, even that are selling in the US and Canada. Like that's a, it's a very different approach to business for these print partners. And so figuring that whole thing out, that interface and, and the, the technical side of it, the business side of it, uh, is, is really job number one, right? Like mm-hmm. , how are you del how are you gonna deliver that physical product? And, and, right.

Tim Rowe (00:13:10) - Cause you need everyone to, to buy it. You can have a great idea and an API and the technology to do it, and the printer says, I'm not interested. You're beat.

Dennis Kelly (00:13:20) - Yeah. How do I make money on this? I I have no idea.

Tim Rowe (00:13:22) - It's a great idea. .

Dennis Kelly (00:13:24) - So, so, and, and then kind of learning everything that can go wrong when you are, you know, printing something with, you know, equipment that breaks in humans that are involved in, like, there's, there's all this stuff that, that can go sideways in a, in a physical process. So, you know, and then, and then when that happens, like how do you deal with that from a, a, a, a, a software perspective? So, um, you know, it's that that set of translation layer between all the things that make direct mail challenging, right? How do you abstract that and how do you make it, uh, you know, is as seamless and and easy as possible so that the, the end user is thinking about marketing instead of project managing all these vendors and all these processes that they really don't know anything about,

Tim Rowe (00:14:15) - Because they don't care how hard it is. They just want the result, which is, I'm putting a message in someone's hand, and then they are taking an action and calling my business or coming and visiting me or buying a thing online. That's the job to be done, is produce an outcome. They don't, they don't care how hard it is to do it. They just wanna do it.

Dennis Kelly (00:14:33) - They wanna do it. And, and, you know, I I like to point out, you know, there's a lot of similarities between direct mail marketing and email marketing, uh, except, you know, an email marketing, you're not out there interviewing the email server and, you know, picking this email server you're gonna work with, right? , right? And, and the email server isn't asking you, you know, like what kind of, what kind of, uh, HTML do you wanna use, right? Like it's all standardized.

Tim Rowe (00:14:58) - It just happens.

Dennis Kelly (00:14:59) - Exactly. Exactly.

Tim Rowe (00:15:02) - So, and, and then, so you, you get the adoption from the printers, now it's scaling up and obviously balancing out the supply of, of people willing to print things with the demand of marketers who want things printed. Where do you approach that from? Is it, is it the low end? Is it the high end? How, how have you gone about disrupting the actual buy side?

Dennis Kelly (00:15:26) - So what, what we've decided is that, you know, print in many aspects has been commodified over time. There, you're probably aware there are, there's been a, you know, a, a loss of print revenues, right? So printers who have survived have cut price and, you know, they've, they've kind of lived by just, you know, paying enough money to keep these machines going or, or charging enough to keep these machines going. So, you know, we said, well, well, you know, there's a, there's a layer here of value that we can bring at the higher end with personalization and advanced technologies that aren't available in a manual kind of analog direct mail, uh, kind of campaign. And so we've taken that approach that, you know, we, we wanna, we wanna do more advanced marketing using direct mail, not the cheapest, you know, kind of, uh, mass mailing, you know, spray and pre kind of models that, you know, still survive out there to this day. Um, you know, we're, we're, we're really kind of going up market and say, Hey, you know, if you wanna, if you wanna do sophisticated marketing with, you know, advanced personalization and, you know, layering of your digital and, and direct mail channels that we're, we're, we're after you, that's the kind of customer we want.

Tim Rowe (00:16:57) - I guess you can really hear it in the name post Alytics is definitely appealing to that sophisticated performance marketer, and it's the same customer that out of home that, that we're talking to and we've been talking to over the last few years. Some of the challenges incumbent for us are around, we figured out, I, I think that the, the targeting conversation, but particularly around the attribution piece, is that a part of the platform here is that you're producing a feedback loop for the brands who are investing in direct mail.

Dennis Kelly (00:17:32) - Absolutely. Yeah. There, there're really three fundamental things that we are trying to accomplish, uh, a as a business and, and it's really helping our customers, number one, have a far more streamlined workflow, you know, time to get a campaign out the door from weeks to hours. Number two, integration with that marketing tech stack, as I mentioned. Number three is really around analytics. And, and so, you know, when you interview folks that have been doing direct mail for a long time, you'll ask them, well, how do you know that this works? And they will often say, well, when I stop mailing sales, go down

Tim Rowe (00:18:11) - . That's a pretty good way to to, to judge it, I guess, the best available.

Dennis Kelly (00:18:16) - Yeah. Right. So that's great. But, but that's not going to convince people that are new that, that want to try this, that, that, that, that they need more than that, right. And, and other channels are able to provide that type of data. And so, you know, we've made a a significant investment here in tracking both delivery and response to direct mail and two different things.

Tim Rowe (00:18:45) - Did it hit the mailbox?

Dennis Kelly (00:18:47) - Exactly. So thinking, and did they do something in that kind of email marketing concept, right? Like, you, you need to know what, when the mail's hitting, if it is hitting or if it's being returned, right? There's, there's all these sort of layers. So we've, we've been fortunate enough to tap into an internal tracking system that the U S P has for commercial mailers. You get a little incentive to put a barcode on the bottom of a mail piece that then the USPS barcodes as it goes through its entire delivery process. So you got that

Tim Rowe (00:19:22) - Domino's Pizza tracker.

Dennis Kelly (00:19:24) - Exactly. It's, and it's open to anybody. They, they can use it. And so, you know, what we're doing on the software side is saying, Hey, you know, this postcard from this campaign from this customer is gonna go to Tim. We're gonna put a unique barcode on that and then associate it to Tim for this particular piece of mail. So then as the post office scans the mail as it goes all the way through the process, we know precisely where Tim's piece of mail is, and we're able to communicate that back in both in terms of, you know, visualization and dashboards and our, and our app as well as those integrations back into the tech stack. So then all of a sudden, Salesforce and HubSpot and, and all of your infrastructure knows when Tim's piece of mail is being delivered, it knows, Hey, uh, we just found out from the post office that Tim is no longer here.

Dennis Kelly (00:20:14) - Right? We got a different event we're gonna send back. So, so capturing that data and making it actionable is a massive change in the, in the direct mail world, uh, sets, number one. And then number two, we've actually, uh, uh, gone out and built and patented some methods of creating personalized QR codes and URLs mm-hmm.  so that you send out a postcard and it's got a QR code on it to Tim, Tim hits it. We know that this is specifically the postcard that came from this campaign to Tim. Right? Right. And we know that Tim is online in doing the following things. Wow. And, and so, you know, we're able to capture that response, that attribution that is so difficult to, to do in an, in an analog channel. Uh, and it's really about bridging the offline of the online, right? Because once you get somebody online, you can do a lot. Uh, so it's like, how, how do we, how do we get those responders to hop online and, and touch us in a digital way so then we can really track what's happening?

Tim Rowe (00:21:27) - And so, again, relevant for out of home, because those are the two primary objectives that we are delivering or, or, or trying to deliver to our brands and advertisers, is one, your ad delivered, right? It hung up. We have the proof that your billboard is live in the wild. And then more specifically is the, and here's what happened once people saw it, they went to your website, they visited your store, they bought the thing, they downloaded the app, they uploaded the balance, they did the thing that you ultimately cared about them doing from, from the, you know, original concept of the campaign. Dennis, I'm curious, how, how has your own perspective on marketing changed? You're, you're an OG at this startup game. You've surely been involved in a lot of marketing conversations, and now you're leading a, a, a marketing tech platform. How has your own personal thesis on marketing changed as you've seen and experienced some of the things that you have?

Dennis Kelly (00:22:27) - Well, you know, I think that, um, really my thought process as a marketer myself is, is, is that if you just do what everybody else does, you are lost. You. You've gotta, you've gotta think, you've gotta, you know, Bob, and you've gotta weave. You've gotta find, um, areas that are not as exploited and, and, and, and you gotta find a way to make them work for you. And, and, you know, there's opportunity to do that online and offline and, and that, you know, older marketing channels don't have to be kind of thought of in the way that, um, that they have been presented in a traditional way. And, and so you, you can apply technology to bring the best attributes of the digital world into the offline world and weave them together so that they're really just one thing. It's really just about marketing and, and use whatever channels are, you know, not as crowded and, and less competitive. And, and then you get an edge, you get an edge over your competition that way.

Tim Rowe (00:23:55) - For someone who's listening to this, maybe they're, they're an executive themselves and they've, they've had a successful career and they, they have knowledge to share, they're wanting to develop themselves as a thought leader and, and share what they've learned to this point, what advice would you give them in getting started out? It's something that you've, you've spent a lot of time on, but what advice would you give to somebody who maybe is just getting started or thinking, Hey, I want to really put myself out there and share what I've learned to this point?

Dennis Kelly (00:24:24) - Well, you know, I think that, uh, the, the, there's a couple things that, that I've found to be very, um, beneficial. Uh, number one is, uh, starting a blog and, and being able to publish thoughtful, at least in my opinion, thoughtful  content

Tim Rowe (00:24:46) - ,

Dennis Kelly (00:24:47) - You know, that that represents, you know, uh, a little bit more depth than, um, what you'll see put out there on, you know, at a kind of a general level. So if you've got some, if you've got some deeper expertise in an area, go deep, right? Go deep on that. And, and then the other thing is just doing this, right? I mean, getting out and, and making yourself available to join podcasts. Um, and, and where you get a chance to, to talk with like-minded people about, you know, topics that they're passionate about, you, you get great stuff. And, and so, you know, I think those are two things that, that I've done that I've found to be very effective in helping to spread the word and, and, and get the message out.

Tim Rowe (00:25:43) - And, and, and thank you for that blogging is, is a recent addition for me, but I can't encourage you enough because there's lots of podcast hosts like myself who are eager to talk to you, uh, and we're, you know, just looking for great conversations to share with audiences that care about the same things you care about. So, uh, I really resonate with, with both of those things, and appreciate you sharing that. Dennis. A question that I'd love to maybe get philosophical on for a second is, if you were starting post alytics today with everything you've learned through having, you know, run the company now for going on the better part of a decade in, its, in its various forms, but everything that, you know, the collective body, if you were starting post alytics today, the company that you're working on building is scaling right now, what would you do different?

Dennis Kelly (00:26:38) - That's a great question. I think there were some decisions very early, uh, that I think I took too long to make, and hmm. You know, when, when you are, when, when you've, you've bought into a concept, you've put your heart and your soul and your checkbook behind it, you wanna make it work. And, you know, post lytics is actually a result of a pivot off of a first product. And, you know, if, if I could have gone back to Dennis several years ago and said, Hey, Dennis, pivot now, you know, don't, don't try that extra marketing person. Don't try that extra sales channel. Don't, you know it, it's not, it's not something that is e execution based. It's strategic. You need to be able to sell to the right audience. And we, we were, we, we had a great product. We were selling to people that, it just wasn't a great, it wasn't a great market. We were trying to sell the initial version of this into, so the, the pivot that ended up becoming post alytics could have happened a couple of years earlier, and we'd be much further along and mm-hmm. , and, you know, we, we would be, I mean, we're on a great trajectory. You know, we're growing between 80 and 90% a year on an annual basis, so it's wonderful. Um, but we could have been there earlier and, and we'd be that much further along if I'd made that decision a couple years, uh, earlier.

Tim Rowe (00:28:24) - I think that that's an incredible lesson, and I'm sure is, is resonating with some folks right now. I think that that's, uh, an exciting opportunity for all of us is, is to grow faster. So potentially looking at what are the decisions we're, we're not making, uh, or the decisions that we are that could be potentially holding us back from growing even faster. So really appreciate you sharing that, Dennis, in, uh, in, in the world of, out of home, we call it the latitude and longitude, but you're dealing with real mailboxes where, uh, where do folks find you? What's your address online? Where do, where do people learn more about you? Are you, are you active on any social channels? Tell folks how to get in touch.

Dennis Kelly (00:29:03) - Absolutely. Yeah. So, uh, the, the best place to learn about post alytics is our website. Uh, we're at, uh, post alytics.com, P o s t a L y T I C s, postal analytics, kind of postal analytics put together. Got

Tim Rowe (00:29:18) - It. .

Dennis Kelly (00:29:20) - So, uh, so that's, that's, you know, a a, a big part of what we're doing. We have a very, very active blog, uh, lots of great content. Uh, we also are very active on LinkedIn, and that's usually where you'll find me is, you know, I, I'm, I'm not a, a huge, um, uh, Twitter or Instagram or Facebook guy. Um, I, you know, I'm involved in those channels, but it's, I really focus majority of my efforts around LinkedIn. And so you can hit me up on LinkedIn, uh, Dennis, John Kelly and, uh, or, you know, Dennis Kelly, CEO post Lenox, uh, follow post lytics on LinkedIn. We're very active. There we're, we're, we're building a, a great, um, content channel there. So, um, you know, those are probably the key areas

Tim Rowe (00:30:09) - And we will link to all of those. And I really encourage the audience to do that because so much of the conversation, Dennis, that we've developed here over the past four years is, is how out of home blends into the holistic marketing mix. It's not out of home or direct mail, frankly, the, the, the test that I'm really curious to run is out of home and direct mail. I think that you could make a very good case for that is the full funnel marketing stack of every local smb and could be the greatest untapped growth hack for startups and companies struggling with, uh, a rising CAC is to, is to blend these offline channels. So, uh, really encourage that, that blending of the education there as well.

Dennis Kelly (00:30:54) - Absolutely. You know, imagine you're, you're driving home from the store, you're driving home from work, you know, you, you see a great out-of-home ad, it makes an impression, and then you get home, you get your mail, and then there's a big postcard with the exact same message, right? Oversized postcard, big image that's matching exactly what you saw in that out-of-home experience, right?

Tim Rowe (00:31:17) - Billboards in the mailbox

Dennis Kelly (00:31:18) - Is hammering at home, right? And, and, and the fact that these things could be weaved together through automation now is, is really what has sort of changed the game.

Tim Rowe (00:31:28) - Definitely. And when we think about, we're seeing a, a big shift in brands refocusing on zip code level targeting and just thinking about the implications of those two things is very exciting. So I'm sure that this is the first of many conversations. Dennis, thanks again for being here.

Dennis Kelly (00:31:46) - I love it. Uh, this has been great, Tim. Really appreciate the opportunity to speak to you today. And, um, I'm excited to see how things unfold in the future.

Tim Rowe (00:31:54) - Same, same. I'm subscribed, and if you are, or if you're not, you should definitely get subscribed. Uh, if you could leave an interview, leave an interview, I'm gonna come back and stitch that out. If you leave the podcast a review, that's how you help us grow, and we'll see y'all next time.