Spending on U.S. direct mail services rose 7.5 percent this year to
$60.6 billion, according to estimates by
Winterberry Group LLC, a New York consulting
firm. In its third annual white paper on vertical market trends affecting
direct mail production, Winterberry predicted that overall spending on
direct mail services will reach $73.6 billion by 2009, reflecting compound
annual growth of 6.8 percent for the period 2005-09. Among the trends
cited in the white paper:
The use of customer relationship management (CRM) tools continues to
be important for all marketers. Winterberry's survey of production
providers found that 89 percent have noted increased use of
personalization over the last 12 months. However, two-thirds of those
efforts included name and address information, which is virtually the
same as it was in the previous two years. Message relevance, such as
timing--rather than simple personalization--"has emerged as the ultimate
targeted communications objective," according to the white paper.
Marketers must continue to improve data quality and hygiene
solutions. In other words, clean up those lists. Close to 10 billion
pieces of undeliverable-as-addressed (UAA) mail were sent this year.
That amounts to at least $5 billion wasted in direct costs and much more
in lost opportunity, according to the report. With another postal rate
increase on the horizon, direct mail marketers will want to do better to
offset higher expenditures elsewhere.
Digital print applications will grow dramatically throughout 2007.
Lower digital print costs and increases in production speed, thanks to
such things as improved workflow software and printer platform
enhancements, allow for more cost-effective, high-volume campaigns,
according to the report. Digital print continues to be strongest in
vertical markets with "high customer lifetime value," such as
automotive, business-to-business, healthcare/pharmaceuticals,
hospitality and technology. Short run applications are becoming more
price competitive as traditional commercial printers begin to offer
digital printing of items such as post cards and self-mailers. However,
"mid-tier and vertically focused firms... continue to invest and build
expertise with variable data and content, print-on-demand, Web-to-print
and more advanced personalization capabilities, thus achieving margin
expansion," the report says.
Despite online bill paying, billing statements remain important. In
2006, the statement printing market grew at a steady, but slow, pace,
thanks to the increased adoption of inserts as marketing tools.
Winterberry Group predicts that inserts and color utilization will play
a greater role in statements in the future.
To see the complete report, go to
http://www.winterberrygroup.com/, and download a
PDF version of the white paper from the home page.