The United States Postal Service (USPS) actually has a magazine it puts out somewhat regularly called Deliver. I don’t know if they give themselves a discount on their periodical rate. Quite often there are articles regarding the viability of mail; adjectives like enduring are used in conjunction with the description of the tangible advantages of the touch and feel of a mail piece.
Recently, advertising mail supplanted first class mail in total pieces delivered. Yet the USPS lost money last quarter – in fact the USPS has lost money in 12 out of the last 14 quarters. This year the USPS recommended cutting Saturday service as well as eliminating prepaid retiree health benefits.
We all know the reasons why – online bill paying being one of the big reasons first class mail volume has dropped so dramatically. To counter the ongoing trend downward the USPS has filed for a rate increase which will impact both first class and standard A (or advertising mail). Standard A or direct mail advertising continues to grow in revenue but some interesting changes are taking place as prices go up and mail volume overall declines. I can’t understand why squeezing the only area of the USPS that is growing seems like a good idea to the USPS.
Mail is becoming the channel for luxury and expensive brands. It’s nearly impossible to prospect through the mail for products and services that are inexpensive. The metrics simply do not work anymore. Magazine subscription offers used to flood the mail box but no more. The decline in magazine subscription mailings has a great deal to do with the decline of magazine circulation in general, but it has more to do with the fact that prospecting for new readers or renewals for existing readers is too expensive to be done through the mail.
It seems to me that less expensive products also have given up on mail as an acquisition channel. However the luxury marketers are using mail effectively as a channel to an increasing degree. Particularly once a prospect inquiry has been made for a luxury product, (whether it comes from a television, radio or magazine ad), that prospect is nurtured and analyzed, and then the prospect will be mailed to on a regular basis.
This tactic is very effective and works for several reasons.
1) Mailing to a self-selected lead/name is highly effective and very profitable for luxury or expensive products.
2) Consumer mailboxes have become more and more empty. Mail messages can penetrate the clutter much more so than in recent years.
3) People under thirty actually are not as tired of direct mail and the message penetrates much more than email which is fast becoming irrelevant to them – especially advertising email.
The tide has turned and direct mail is now on its way to being the bastion of luxury and expensive products and services. Maybe it’s there already.
What do you think?