News

At first glance, things don’t look great in direct mail (DM). The industry has suffered turbulence for some time, to say the least, with anti-junk mail sentiment heightened by the green movement railing against waste. Meanwhile, email marketing has put a dent in terrestrial mail figures, while the recent postal strikes have dealt a further blow. According to insiders, however, things are not as gloomy as they might seem.

Figures from the Direct Marketing Association show that DM still accounted for the lion’s share of direct marketing budgets last year, accounting for 26.1%, with the internet on 21.5%.

The message is clear: DM is still an important form of communication for marketers and a major contributor to the UK economy.

As Nick Pride, technical director Charterhouse, points out: “DM continues to be an essential ingredient in the marketing mix. It is still one of the few media for which you can calculate a meaningful return on investment, rather than the attractive, but ultimately misleading, ‘cost per response’.”

The good news for everyone in the DM supply chain, as statistics testify, is that clients still want
to use DM as part of their marketing strategy.

Short-run campaigns
What will change, however, is the manner in which they use it. The old-fashioned method of blanket mailing will ultimately be replaced by highly targeted, fully personalised, colour, short-run campaigns that take advantage of the latest advances in print hardware and software technology – for cost reasons, as much as anything else.

Yolanda Noble, chief executive of Dsi CMM, says: “Personalised colour printing has become affordable for all customers, rather than just the high-value ones, so the ability to create a tailored set of contents for each customer’s envelope has become very sophisticated indeed.

“Faced with a daily barrage of poorly produced, ill-targeted, uninspiring mail, consumers are happy
to see messages that are actually meaningful, accurate and timely.”

The impact of adopting the personal touch can be impressive. Noble cites research by Pitney Bowes that suggests 60% of consumers welcome mail that is personalised and targeted to their profile. Colour is important too, according to Tim Delahey, chief executive of DSTi Output. A study by the company found “colour is 55% more likely to be read before the same message printed in black and white”. Delahey says it “can improve response times by up to 30% and increase the likelihood of purchase by 80%”.

However, Richard Maclean, sales director for Integra, a supplier of mailing solutions, says before companies go down this path, two things must be in place: personalisation technology – “from a printing and fulfilment point of view” – and accurate data.

The good news, in terms of data, is that companies looking to become more customer-focused are improving their information-gathering skills.

“We have experienced a huge rise in requests for data cleansing, and even companies looking to upgrade their own data collection systems,” says Linden Kitson, managing director of Lick UK. “Cleansing data is key to ensuring mailings go to the correct individuals and help develop a better customer relationship.” In addition to more efficient data collection, and the subsequent take-up in colour and personalisation, DM is also expected to play a strong part in mixed media campaigns.

“Multi-channel marketing is offering some exciting opportunities to the DM industry, allowing it to develop highly creative, targeted and innovative campaigns through a range of mediums,” says Kevin Pembroke, principal consultant at AccessPlus.

“We are now seeing online tools driving interest towards printed information and printed marketing collateral, driving the customer towards Purls [personalised URLs] and other online information and marketing initiatives.”

Harnessing power
It isn’t just print and online working in tandem. According to Lucy Edwards, marketing director for Howard Hunt Group, fully integrated campaigns across all media are now being instigated.

“A number of brands are harnessing the power of above-the-line and below-the-line traditional and new media.

“Each has different attributes and objectives, which means that integration can deliver a wide-reaching, but personalised, campaign. Guinness’s activity around the Rugby World Cup, for example, includes TV, point-of-sale material, press, DM and digital advertising.”

So what the future hold for DM? First, there are the recent blows inflicted by the green lobby and the mail strikes. With no resolution to the threat of strikes in sight at the time of going to press, there could be further disruption and heartache in store for the sector in the short term.

While some DM insiders say the strikes have caused minimal disruption, others concede they haven’t helped matters. “I can’t pretend that the strikes didn’t cause more than a few irritations for some of our clients” says Edwards. “Inevitably, we have experienced some dips in response, but they are a fact of life. Marketers are realistic and appetites have not diminished.”

As for longer-term concerns such as the environment that are not likely to go away, the DM sector will have to undergo changes in the same way as other industries. “The industry has faced a huge amount of criticism for producing material which is ignored and wasted,” says DSTi’s Delahey.

“Consumers are a lot more savvy to endless amounts of inserts advertising products and services that are not relevant, with more than a million customers now regularly ticking the ‘do not contact’ box.”

However, Delahey adds that firms such as his have the technology and capability to print the same amount of information on to customer statements, which are less likely to be discarded, or to only send documents that are pertinent to the individual.

Bullish about future
Charterhouse’s Pride points out that today there are more alternatives to DM to consider, which is why many in the sector are bullish about its future.

AccessPlus’ Pembroke says: “DM is still a very buoyant market and one that continues to grow in certain areas. Mass-volume, non-personalised DM will no doubt decrease over time, but it will be replaced by highly intelligent and creative integrated direct marketing driven though a variety of on-line and off-line channels.”