DM Spending Expected to Dive 8 to 9% in 2009

DM Spending Expected to Go Down -- and Down -- in 2009

DIRECT MAIL SPENDING AND VOLUME IN STEEP DECLINE – 2008 SPENDING FALL OF 3 PERCENT IS FIRST IN OVER 60 YEARS OF MEASUREMENT; EXPECTED TO DROP ANOTHER 8 TO 9 PERCENT IN 2009

Recession, media consumption changes spur shift from “saturation mailing” to targeted, analytical approach, says new study from leading strategic consulting firm

NEW YORK, February 27, 2009 — Squarely impacted by the “triple assault” of the recession, rising postage rates and growing marketer preference for low-cost digital communications, total U.S. direct mail spending declined sharply in 2008—falling 3.0 percent—and was accompanied by an even more significant cutback in mail volume, according to a white paper released today by Winterberry Group, a leading strategic consulting firm serving the marketing industry.

The white paper, entitled A Channel in Transformation: Vertical Market Trends in Direct Mail 2009, is the New York-based consulting firm’s fifth annual study of trends in direct mail media. Based upon feedback provided through hundreds of interviews with executives from throughout the industry (including both mailers and the service providers who support their campaigns), it explores macro trends, unique production sector issues as well as developments specific to one or more vertical markets.

According to Winterberry Group, a rapid drop-off in financial services mail activity (brought on by the crisis in the banking and mortgage sectors) fueled the overall decline in mail spending, the channel’s first in a recorded history that began in 1945. Further decay in mail activity is expected to continue through the course of the recession, at which point the direct mail channel will likely emerge as a medium used more for precise targeting than “saturation mailing” as it has been over the last decade.

The report concludes: “A wide variety of new mail applications will continue to emerge. Based largely on deep data and technology underpinnings—and structured to take advantage of direct mail’s unique ability to enable customer acquisition and integrate with other media—these applications have been incubating for several years. The events of the past 18 months have moved them to the forefront, and both marketers and service providers alike would be wise to follow.”

The white paper outlines six trends that took hold in 2008 and another three that are expected to continue defining the role of direct mail in 2009...

[More at The Winterberry Group site.]

Ed: Needless to say, this is terrible news for writers, designers, art directors, strategists and clients who have relied heavily on direct marketing. It's a call for ever-more-creative thinking about how to reach consumers in a cost-effective, compelling way. Digital media seem the best bet right now, but we'll continue to think of new vehicles for DM messages. How about changing messages like the ones on highway billboards appearing on dentists' and doctors' exam room ceilings? Or would that would patients associate the products with pain and fear? C'mon, think! Think!