Dave’s Take

In a recent study compiled by Borrell Associates, direct mail is given a fatal diagnosis for future relevance. According to the report entitled, “Direct Mail Doomed, Long Live Email,” the future of DM is apparently as bleak as that of a Lehman Brothers resurgence. How sick is the patient? Borrell predicts a whopping 39% decline in direct mail spending over the next five years, sliding from $49.7 billion in 2008, to a meager $29.8 billion by 2013. On the other hand, Email, which claimed over $12 billion in 2008 expenditures, is expected to more than double in committed spending over the next five years.

So why on earth is one of the most traditional advertising channels headed to Boot Hill? Ad experts attribute DM’s fall to several factors, including:

• Expense—as the USPS continues it’s downward spiral (2008 losses topped $2 billion) it’s forced to raise already high rates. Combined with a weakened economy, even Vana White knows that spells doom.
• Aging Demographics—the average age of non-profit off-line donors is 65+ and they are one of the few consistent DM targets.
• Low Success Rates—even the best of DM houses will only promise returns in the .05 – 4% range. In fact, industry estimates show only 2.8% of all direct mail results in any kind of a response. Not bad, but hard to compete with the immediacy and excitement created by today’s new media channels.
• Green Movement—the EPA estimates that four million pounds of direct mail is being thrown away annually, with only a mere 30% being eventually recycled. Internationally, a full 30% of ALL worldwide mail is comprised of U.S. junk (er, direct) mail, resulting in the sacrifice of over 100,000,000 trees. Non-profits are reporting an overwhelming response from contributors to cease with the DM campaigns.
• State Laws—it’s called junk mail for a reason—people hate it. Currently, twelve states are considering laws to limit or eliminate direct mail, with expectations pointing to only increased regulatory pressure.

Despite these harbingers, direct mail’s death may be slightly exaggerated—at least in terms of total destruction. DM experts point out that only traditional direct mail is in danger of extinction. They believe small, demo-targeted DM campaigns will continue to be a part of any agency’s successful multi-channel campaign strategy. In fact, some observers predict direct mail will evolve to be a major player in driving viewers to online programs. Maybe, but as far as I’m concerned, the relevance of direct mail has left the building…to which I say, “Thank you, thank you very much.”