Direct Mail Market -- Market Share from Another Medium?
"Cautiously optimistic" is the same term used by Tim Stratman, president of RR Donnelley's direct mail business, to forecast the coming year. He reveals that business conditions improved with key customer segments in the fourth quarter, particularly retail and agency clients, leaving a brighter outlook than that of 2003.
Among the initiatives undertaken by RR Donnelley include re-engineering its sales force, enhancing its marketing efforts and investing in new technology. "We identified specific customer segments and began utilizing direct mail to communicate with our targeted customers on a regular basis," Stratman notes. "Additionally, we are upgrading our sales force by hiring and training new sales reps. We have also expanded our production capabilities to more effectively meet our customers' changing direct mail needs."
In the short term, marketers will be re-evaluating their marketing mix and turning to direct mail in light of the DNC Registry, according to Stratman. Over the next year, that could translate to an increase of 10 percent, contingent upon economic conditions, driving 2004 marketing budget spending.
"As a leading direct mail printer, we are well prepared to handle the needs of the marketplace," Stratman says. "Through continuous improvement, our manufacturing team is committed to getting direct mail campaigns right the first time."
Solid Contributors
Jim Andersen, president and CEO of The Instant Web Companies (IWCO), points to solid direct mail performances in the financial services, insurance and travel markets as augmenting his company's solid 2003 performance. Financial services companies pushed their credit card programs with low annual percentage rate and balance transfer offers. Travel companies were battling each other to see who could provide better deals, and insurance companies have been fixating on the baby boomer generation.
"Our growth is . . . because we do direct mail like no one else," Andersen contends. "There isn't another offering in the United States where you have a complete, turnkey solution with the four key disciplines—the printing, envelopes, plastic cards and mailing—in one domain, where we manage the whole logistics stream, including commingling. This provides a profound savings for major direct marketers as opposed to doing it in a horizontal solution, where you procure your own data processing, envelopes, printed product, plastics manufacturing, then find a mail shop."
