Direct marketers saw rising sales and profits in the third quarter, according to the Direct Marketing Association’s quarterly business review.
“Essentially, sales have been very solid,” said Peter Johnson, senior economist at the DMA. “Everybody seems to be doing quite well with profitability.”
Compared to last year’s third quarter, direct marketing users, agencies and suppliers reported sales growth in an online survey of more than 210 companies. The QBR Index, in which a score above 50 represents growth, showed an overall score of 62 for revenue growth, with respondents projecting next quarter at 67. Profits were ranked even higher, at 71 industry-wide. About 60 percent of respondents reported sales growth versus 28 percent with declines.
The report marked the fifth consecutive quarter of growth for the industry. It is viewed as a benchmark for direct marketing’s health, looking at sales, profits and staffing levels.
“We seem to be doing the best we’ve been doing since 9/11,” said Liz Kislik, a direct marketing consultant.
Johnson said all segments showed solid growth, except telemarketing, which respondents said would continue to decline in the fourth quarter. The DMA found the no-call list slashed $5.7 billion from telesales, from $18.9 billion to $13.2 billion.
“We anticipated this, we yelled about this, and it’s come true,” Kislik said.
Direct marketers tabbed economic conditions and political issues as the two main factors they expect to impact their performance, with relatively few choosing such hot-button issues as privacy and list issues.
Catherine McIntyre, president of ICOM, a Toronto-based direct marketer, sounded a note of caution. She said consumers are increasingly revolting against intrusive marketing practices.
“They’re inundated, they’re wary and they’re tuning out,” she said.
