I read an interesting article on cnn.com titled "Less junk mail: Good for you, bad for economy".  It was a side of direct mail I had never thought of.  Most of us get at least 1 piece of junk mail per day; whether it's a credit card offer, carpet cleaning discount, or another company we have never even heard of.  Think of how many companies use direct mail to entice people to buy their products and think of how it really can help stimulate the economy!

The article went on to explain that credit card companies sent out over 7.2 billion direct mail pieces in 2007, 5.4 billion in 2008, and only 6 months into 2009 they have sent 900 million.  Mortgage businesses sent out approximately 4 billion in 2005 to 1.1 billion in 2008.  And in the first 6 months of 2009, they have only sent 220 million pieces.

If you think about one direct mail piece that goes out, that really can affect 3 to 4 points of contact.  Obviously, the company who was sending them out is saving money by not sending them out, but they could also be losing money by not sending them out as well.  Second, the firm that designs the direct mail piece is no longer receiving revenue from that company.  Third, the printing company who prints the direct mail piece is no longer receiving that income.  And last, the post office is no longer sending billions of direct mail pieces, so they're losing the revenue from the postage that is used to send them.

I also think the decline in the number of direct mail pieces that are sent out is also because the companies sending them out are getting smarter about their communications and their bottom line.  There's no longer a need to send the same direct mail piece to everyone living in a certain zip code. Companies' target audiences are getting much more narrow and very specific as they adopt new data mining technologies.  Companies that used to send one campaign to thousands, even millions, are now using variable data and print on-demand to refine and target their message to a specific, targeted recipient. Now ad agencies like BIGSHOT who partner with these types of companies can leverage a basic database of information (name, specific interests, email addresses, phone numbers, etc.) send out personalized direct mail, emails, and even text messages to their customers with PURL's (Personalized URL's) in order to gather more information and further define their customer profiles. In return, their customers get less junk mail and more informative, strategically targeted communication from companies who want to do business with them.

So determining why direct mail is in decline is really a question of whether the companies who used to send massive amounts of direct mail getting smarter by sending to a more specified target audience to drive conversions, or do they not have the budget to embark on larger, less specific campaigns that may now be good mostly for brand building, or both?

Andy Brown graduated from the University of Kansas with a B.S. in Marketing.  Despite the fact that BIGSHOT is dominated by Missouri grads, Andy will remain committed to his KU roots, and promises to paste Jayhawk stickers all around the office at every opportunity.  Other than being a KU fan, Andy has a passion for going above and beyond, and making exceptional work even better.  Learn more about Andy.

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