The US Postal Service faces an avalanche of mail daily, delivering some 213 billion pieces of mail to over 146 million home and business addresses in 2006. That’s 26 pieces of mail to every household, or 41 pounds annually.
Delivery is a huge job of coordination, yet deliveries remain timely and efficient: two- and three-day commitments achieved 90 per cent delivery rates.
Considering the volume and the dollar amount of delivery alone, it’s no wonder that direct mail remains one of the main forms of direct marketing in the USA. According to the Direct Marketing Association (DMA), the leading trade association for the industry, marketers spent $166 billion on mailing solicitation in the USA in 2006. The advertising expenditures accounted for almost $2 trillion in sales, some ten per cent of GDP. Direct mail is a lucrative market that everyone wants to play in.
Often called “junk mail” for its tendency to wind up in the waste stream, Americans spend eight months out of an average lifetime opening unsolicited advertising mail and throw 44 per cent of it away, unopened. That doesn’t deter direct mailers. Direct mail from catalogue companies increased from 92 billion pieces in 2003 to 104 billion in 2007, accoding to ForestEthics, an environmental organisation.
Even with postcards being the most likely form of mail to be read, that’s a lot of printing. Advertising mail generates $686 billion of economic activity annually (DMA), although questions remain about how long printed material will remain the dominant form of advertising directly to homes.
Internet advertising increased 34 per cent in 2006, and sales from paper and web-based catalogues are projected to reach equity by 2010. Although 51 per cent of internet users say they would rather order online, 67 per cent of consumers say they would rather shop in a store. Direct mail will continue as a method of soliciting many of these customers.
Along with catalogues, credit cards remain another top producer of advertising mail. The volume of mail from such solicitations decreased from 6.1 billion in 2005 to 5.2 billion in 2006, and will no doubt fall with the world financial credit crisis. Mintell Comperemedia, a market research group, estimates the mailed credit card solicitations cost an average $1.25 a piece, and these solicitations will decrease in volume and provide less income for printers.
With growing concern about the environmental impact of traditional industries on global warming, direct mail provides a good example of a waste stream that is in need of rethinking. Currently only 13 per cent of junk mail is recycled. The Center for a New American Dream in Maryland estimates that 100 million trees are needed to fuel the mail cycle, which results in 5.6 million tons of landfill annually.
That doesn’t include energy, oil and water usage, or $370 million to dispose of junk mail that can’t be recycled.
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