Is Direct Mail Dead?

By: Joseph Kiefer

I subscribe to a number of marketing magazines and newsletters (e-mail and hard copy). I can't help but notice a trend towards articles detailing the demise of direct mail and the rise of social media and other electronic marketing. So I might as well throw my two cents in.

Let's start with a little background. I am under the belief, disillusioned or otherwise, that the USPS was going to run into some major problems due to on-line bill paying, e-mail, on-line shopping, inefficient/outdated operations and a handful of other potential problems. In 2007, I would have thought that it would have been 5 to 10 years before they would realize the extent of their problems and start to make major changes. The recession brought their problems to the forefront much quicker then I think anyone could have imagined and they now find themselves in a mess.

A large chunk of that mess can be attributed to the volume of direct mail that marketers are sending out. The severity of this recession forced many mailers to cut deep into their mailing plans and many mailers to cut out direct mail all together.

That brief background brings us back to the debate over the remaining life of direct mail. I think there are many factors that could push this one way or the other, but two of the most important revolve around the steps that the USPS takes to retain its' customer base and the willingness of marketers to return to the market. In many ways the decisions of the USPS could dramatically affect the marketers return to the market, so they are very interdependent.

I met with two representatives from the USPS this week and we discussed both of these issues. For those of you in the direct mail world, or for those of you who read this blog, you already know that the USPS will not be raising their rates next year. I think this was a great first step towards showing their customers that they understand the situation the marketers are in and they are trying to help out. For many industries not raising rates may not sound like a lot, but for direct mailers this could be the difference between deciding to start mailing again or not. We already had a USPS price increase built into our 2010 budget, so this is like finding a $20 bill in your jacket pocket from last winter. I do think this should only be a first step if they truly plan on winning back lost customers and helping the remaining customers grow through direct mail. I would recommend getting out and really trying to understand their customers better. They have people on the ground that interact with many of them everyday, solicit their feedback as well as sending people out to gather information and nail down pain points. Only then can they truly start serving the direct mailers better.

For the second factor, I am going to assume that the USPS continues to take steps to keep their customers happy and that they don't price themselves out of the marketers' budget. There is still the problem of marketers fleeing at an incredible pace to the cheaper, faster and more easily tracked marketing methods available on-line. Cheaper, faster and more easily tracked do not necessarily equate to more responsive or more profitable. I have always found and continue to find that a well crafted mail piece that is sent to a targeted group of recipients is the one of the most effective marketing methods you can use.

Don't get me wrong, I think every marketer should be out there testing e-mail, search, mobile and social media, but that does not mean that you need to abandon direct mail. Focus in your efforts and make sure you measure effectively and I think you will find that direct mail is still able to be a positive contributor to your marketing mix.

In the end, the USPS is facing an uphill battle, but I believe at a minimum they will be able to rebound back to the pace they were on before the recession and I am sincerely hoping they are able to find a profitable and stable model to move forward with.