DMA's QBR: DM Sales Growth Dips Slightly

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The DM industry generated continued growth in the first quarter of 2005, marking the seventh consecutive quarter of positive results, according to the Direct Marketing Association's quarterly business review released last week.


The review is a benchmark of the industry's financial performance. It identifies trends affecting future performance, including changes in sales revenue, customer response rates, marketing expenditures and staffing levels. Results are based on 323 responses the DMA received to an online survey of member companies in April.


Average sales industry-wide rose 6.5 percent in the first quarter versus a year ago, down slightly from a 6.6 percent rise in the fourth quarter of last year.


The QBR revenue index was 63, down from 69 in the fourth quarter, which saw the highest index number in any quarter since the review's inception in 2002. The Q1 index falls short of the DMA's projected revenue index for the quarter, which was 66. The QBR Index, which is a score out of 100, compares revenue with the year-ago quarter. A score of 50 means no change while above 50 indicates growth and below 50 signals a decline.


The DMA segments the industry into Users, Agencies and Suppliers in the report with all three groups anticipating continued growth in the second quarter. Other results include:


· The business-to-business segment had a profitability index of 73 versus 63 in Q4, though the average sales increase was 9.3 percent compared with a 14.8 percent increase in Q4.


· For catalog users, the revenue index was 61 and the profitability index was 65 compared with 55 and 71, respectively, in Q4.


Kristen Bremner covers list news, insert media, privacy and fundraising for DM News and DMNews.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters


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