Direct marketers have seen profitability marginally increase in the fourth quarter of 2008, according to the Direct Marketing Association’s Quarterly Business Review.
In the QBR Index, scores below 50 represent a decline in direct marketing business performance during the quarter versus the same quarter last year, while a score of 50 represents no change and scores above 50 represent growth.
Despite a fourth quarter of soft revenue performance, overall profitability points to marginal growth with an index of 59. Each of the three segments that QBR benchmarks (marketers, agencies and suppliers) remain generally healthy, posting indices in the high 50s to low 60s, according to the DMA
Agencies again had the strongest index at 61; followed by marketers with an index of 60; and suppliers with an index of 58.
Projected revenue for Q1 2009 points to a decline, with an index of 38, as direct marketers do not expect to see improvements in their revenue performance, the study found. All three segments have similar revenue projection indices for Q1 2009, with a supplier index of 36, an agency index of 39 and a marketer index of 40.
Client budgets moved into overall first place in terms of factors most likely to impact revenue for Q1 2009, with 71% citing it as a concern.
Sixty-one percent of those surveyed cited “General Economic Conditions” as also impacting their revenue for the next quarter, followed by consumer confidence with 37%. In the list of factors likely to affect business expenditures in Q1 2009, corporate growth/decline (57%) and overall marketing budget/plan (54% took the top two places.
The online survey was conducted by the DMA’s research and market intelligence department from January 22, 2008 and January 30, 2009, and included 413 respondents.