Editorial: The DM landscape has changed permanently
The worst of the recession is behind us, and marketers are seeing budgets stabilize. Amid the slow recovery, though, direct marketers may need to re-think everything they have ever done. The picture has changed permanently. They will need to operate in a new environment that has direct marketing at its core, but goes way beyond traditional direct.
Marketers did what they could to maintain or not lose much ground during the recession. In that process, some old dogs learned new tricks by retooling to meet market demands or discovering new revenue sources when others dried up.
In fact, people across the direct marketing industry say that the recession forced them to pare down and focus on essentials. It taught them how to maximize the use of low-cost, efficient direct marketing channels, such as e-mail.
Several sectors were hit hard in the past year. Financial services direct mail evaporated, and all of the direct marketing companies and suppliers serving that market — from list companies to ad agencies — suffered as well. Catalogs, nonprofits and publishers also cut back. Direct mail was down 4.6% in 2009, according to ZenithOptimedia's recent ad spending forecast, and the US Postal Service predicts mail volume will drop by 27 billion pieces by 2020.
David Williams, CEO of Merkle, told me that credit card companies won't ever mail at the same volume.
Direct marketing agency veteran Ron Jacobs, president of Jacobs & Clevenger, suggested a shift is taking place. He said in a recent conversation that he did not create a single direct mail campaign on behalf of clients in the first quarter of 2010. He added, "Two years ago I had two full-time direct mail production managers. In 2010, I don't have any."
Both executives also suggested most marketers are still holding back on major marketing investments.
Direct marketers should remain concerned about the state of the economy and the health of their businesses, and that means maintenance programs and carefully planned, efficient campaigns. That may also mean a future with direct mail in decline while other disciplines grow.
"Right now no one is looking for home run hitters," Jacob said. "They are looking for campaigns that move marketing objectives around the bases, rather than those that hit the ball out of the park."