Weighing in on Forbes

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I have some advice for Fred Hahn, author/consultant/speaker and frequent DM News letter writer: Cancel your subscription to Forbes magazine and get your money back. Fred cc'd me the other day on a letter he sent to Forbes editor William Baldwin because of comments in Forbes' most recent issue. "The junk mail industry ... is giving a new lease on life to Xerox. This firm sells a $500,000 color printer ideal for customized advertising circulars," Baldwin wrote in his July 4 editorial. "Junk is a lucrative sector of the ad business, with a $51 billion annual volume that dwarfs the outlays for magazine advertising. Lucrative, and wasteful. I don't know if the catalogs I get from Lands' End cost more to make than the shirts, but surely they weigh more."

Not happy, Fred said in his letter that he finally was persuaded to subscribe to Forbes, "and what do you think I learned in the very first sentence of the Editor's comments in my first issue? You'd junk mailed me! Permit me a few corrections. You say, 'Junk is a lucrative sector of the ad business.' Unlike Forbes, 'Junk' is not in the 'ad business.' Direct marketing is in the selling business. Unlike 99% of your advertisers, Junk mailers know exactly what they are getting for their dollars and when, as you suggest, they spend '$5 just to get an advertisement read,' they do it because they know from continual testing and analysis that the $5 will produce a profit. You ask, 'Isn't there a better way to get people's attention.' Sure, lots of better ways. There just isn't a better way to get them to buy."

Fred didn't note Forbes' other assault on direct marketing in last week's issue. In a story about the increasing popularity of direct response television, the magazine said, "Infomercials spread like bathtub soap scum after the feds loosened ad restrictions in 1984. Herbalife was one of the first to air 30-minute ads. Direct marketers spent $1 billion on infomercial time in 2004, up 5% in a year. That drove sales of some $50 billion for Jack LaLanne Juicers, Wristicisers, Slim 'n Lift pantyhose and other stuff viewers hadn't realized they needed. ... Even mainstream marketers that once shunned the tacky spiels - General Motors, Pfizer, Procter & Gamble - now have begun using them to reach viewers."

Those numbers are hard to ignore. Also, I'm pretty sure that if Lands' End's catalogs cost more to make than its shirts, the company would be out of business and Gary Comer, its billionaire founder, wouldn't be No. 278 on Forbes' list of the 400 richest Americans. I guess direct marketers do know what they're doing.


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