Some of you may recall the report on e-mail marketing we produced last year. In it, we predicted a direct mail ad spending decline of nearly 40 percent within five years. Nearly a year later, the prediction looks to be right on target. Delivered mail has dropped 250 billion pieces a few years ago to 170 billion pieces in 2009, and will continue to fall this year. The Postmaster General has called for elimination of Saturday delivery and closure of many post offices, to be replaced by kiosks at local retailers. As an interesting sidelight, mail boxes we used to see on every corner are removed from service when they receive less than 25 pieces of mail per week. As of the end of last year, half of those in service five years ago had been pulled from the nation’s streets.
The decline in mail volume has mostly been in personal mail — the letters and postcards we used to send to family and friends, the bills we used to pay. Advertising mail has not dropped nearly as fast … at least, not yet. As e-mail overtakes “snail mail,” the catalogs, marriage mail, and solo offers will increasingly follow suit. Some will dispense with physical distribution entirely. Others will look to newspapers and magazines as replacements for the mail man.
We haven’t discussed the biggest anchor dragging our postal system down. Like most of our nation’s biggest manufacturers — the steel mills, the auto makers, and others — our Postal Service is heavily unionized, and carries a staggering overhang in employee pension debt. The ever-growing volume of pension demands restricts the Postal Service from changes it could make to remain more competitive. But changes will have to be made to the current situation, or the Postal Service as we know it will not survive.
When we published our report a number of negative responses reached us (all via e-mail, by the way). Among those challenging our forecasts the most were charity managers, who maintained that direct mail was just as good and useful to them as ever. It is poignant now to read about the number of these organizations finding new success with social media. We remain confident that direct mail ad spending will fall almost 40 percent between 2009 and 2014 — from $48.7 billion to $31.6 billion, nationwide. However, we take no pleasure in this forecast or the disruption it describes.
Tags: advertising, direct mail, e-mail marketing, postal service
RT @borrellassoc: New blog post: Goodbye, Junk Mail http://www.borrellassociates.com/wordpress/2010/03/08/goodbye-junk-mail/