38% Decline in Direct Mail Predicted
I recently had a conversation with Gordon Borrell, CEO, Borrell Associates, Inc., in which he made some startling predictions for the future of several advertising markets. Borrell’s team specializes in tracking local advertising and reporting how much advertisers are spending in a channel by region.
The most surprising prediction Borrell shared is that spending on direct mail will decline 38% over the next five years. Marketers spent about $48 billion on direct mail last year, Borrell says. While that size might suggest stability, Borrell says that it is actually an indication that the platform is in line for a mighty fall.
“When something grows really fast and gets up to a high level, and there’s a disrupter in the market place, some other technology that provides pretty much the same level of service but in a more efficient way, then you can expect there to be a roller coaster decline.”
That disruptor is Internet marketing in general, and email marketing in particular, Borrell says. Email is an affordable way to send personalized and targeted messages, and the technology continues to improve.
Also, recent reports that the United States Postal Service is considering eliminating Saturday service is contributing to his team’s prediction, Borrell says.
“If the day they cut is Saturday, then that really hurts direct mail. Marketers love to get pieces into homes on Friday and Saturday, because that’s when the buying is done in households.”
Borrell and his team base their predictions, in part, on a disruption model. They analyze what happened to markets of the past when disrupted by a new technology, and apply those lessons to current events.
Has your team cut direct mail this year? Or do you plan to in the next five years? Let us know in the comments…
