Leading mail markets worldwide are at different stages of development, but all need to improve relations with and expect less-strict regulations from their national postal service.
That was the seminal discovery from a poll by agency Draft Inc. in its 29 offices worldwide for client U.S. Postal Service. The findings are a rare snapshot of the state of direct mail globally.
“Everyone's dealing with the decline in First-Class mail volume or its equivalent and electronic diversion,” said John Minnec, executive vice president and managing director of Draft Chicago. “Everyone's wrestling for a solution. A lot of post offices have postal regulations that have inhibited them from doing business as effectively as possible. So now they're on a quest to retool the regulations to be complementary to direct marketers.”
Draft should know. Its Chicago office works on the USPS account. Overseas, it is among the agencies for five postal services: Canada Post, France's La Poste, Poste Italiane, Australia Post and The Netherlands' TPG.
“The [polling] was designed to understand the challenges we faced in the U.S. and to see any commonalities and similarities,” Minnec said.
Understanding attitudes toward mail is key. Consider Britain. According to a MORI opinion poll in March 2003, 29 percent of Britons want direct mail banned while 36 percent immediately throw away promotional material.
On a more positive note, 43 percent of direct mail is read, a DMIS survey in December found. Yet British homeowners put up stickers refusing direct mail, with 1 percent of the population using this option.
Still, direct mail volume in Britain grew 8.8 percent in 2002, and direct mail spending rose 9.7 percent, as reported by DMIS in October. A study from the same organization in November 2002 reported direct mail consumer spending rose 7.1 percent in 2002.
On the continent, the challenge in Germany is postal restrictions. Limitations often neuter innovative mail concepts even as the importance of dialogue-based marketing grows.
German direct mailers and their agencies seek more “postal freedom” from Deutsche Post for their creative staffs. Beyond fewer restrictions, the postal business needs to become more transparent. For instance, restrictions exist on the delivery of ordinary direct mail letters on Sundays and bank holidays, as is the case in many countries.
In Belgium, the challenge is to determine the precise target with the correct database information. The Belgian postal service, according to Draft's local outpost, should respect mailers' delivery delays, allow more mailing delivery places and offer more flexibility regarding tariffs.
One Belgium law prohibits the creation and dispatch of three-dimensional mailings. Draft's local office would prefer that postal delivery delays be shorter, fixed, universal — equal labeling for mail stream bundling — and guaranteed. And since the postal service can strike, mailers and their agencies want a no-loss guarantee.
Belgium's Dutch neighbor has more issues with clients. Agencies want clients to use more direct marketing. They need to convince clients that upfront investments will be paid back.
What Draft in the Netherlands seeks from its postal service is fourfold. First is the ability to do extreme formats. Second, help prove the effectiveness of mail versus other media. Third, encourage know-how and development of customer relationship management. Finally, offer subsidies to spur trial of new direct mail initiatives.
High postage costs are the issue in the Czech Republic. But cultural biases involving mail also exist. Czech citizens are wary of receiving high volumes of direct mail, and they place “No advertisements” labels on their mailboxes. The Czech postal service should require less paperwork and offer flexible pricing and distribution.
Asia presents its own problems. Clean, updated, targeted lists are lacking in Israel, Draft's local office found, while laws restrict mailers from sending catalogs, publications and fliers without packaging them in polybags. The country's postal service needs to lower bulk-rate prices, pick up bulk-mail shipments and use advertising and public relations to promote the need for direct mail.
Singapore and Thailand's problems are worse. A poor understanding of direct marketing and the importance of data frustrate marketers in Singapore. Add to that the poor availability of lists across Asia and the price and turnaround pressures.
In essence, there is a lack of trust and a culture of risk avoidance. Agencies need help in educating clients on direct marketing's effectiveness. They need to offer incentives to clients to use that discipline and also gain support to develop direct campaigns.
Thailand, too, has few effective lists and databases. The lists that are available can be copied and sold with ease, Draft's local office reports. Thai marketers perceive that direct mail needs to be cheap instead of response-driven and effective. This results in a lack of offers, letters or reply cards.
The Thai postal service needs to be more customer-centric. It should offer better bulk rates, services and timelines with full delivery guarantees. And it must cut red tape.
Even Japan, the most sophisticated Asian ad market, suffers expensive postal rates and limited availability of public lists. Agencies seek lower rates, particularly those under bulk classification. Equally important, Japan Post must deregulate its envelope sizes and weights. Mailers, for example, cannot use free-size direct mailers and sampling mail.
Back home, the challenges are many. There is a need to simplify direct mail communications. Waste and clutter need to decrease. Direct accountability must take root.
As an aggregate, Draft ideally wants these postal administrations to identify goals to work on and create consistent addressing and database standards and policies.
It does not help that mail volumes are fluctuating in the United States. Household-to-household First-Class mail is declining, Minnec said, with slight drops in household-to-business, business-to-business and business-to-household. But, luckily for the USPS, Standard mail is up.
Draft's endeavor, which Minnec spearheaded, is to encourage the USPS and other postal administrations worldwide to reverse trends like “Do not deliver,” “Mail is junk” and “Mail is not welcome.” The aim is to create an atmosphere where mail is seen as an invitation, not an intrusion.
“The U.S. is as close to getting it right as any postal service in the world,” Minnec said. “The only country close to us is Australia, but that's not to be disparaging of others.”
The USPS probably won't want to follow Sweden's example. Sweden Post delivers daily to 4.3 million homes and 800,000 businesses, its 40,000 employees handling a daily volume of nearly 20 million pieces. But it closed all of its standalone post offices and moved them into 3,000 retail outlets that are the Swedish equivalent of Wal-Mart, OfficeMax and Target.
“What Sweden is doing is reflecting the consumer demand for longer hours and greater flexibility,” Minnec said. “It's something that the USPS should consider or take a closer look at. I'm not suggesting they shut down post offices, but they should take a close look at how we can extend hours or increase accessibility at retail locations.”