Latest News

Direct marketing trends: US vs. Australia

Thursday, 22 February 2007
By Print 21 Online Article
Tagged with:

Macro Direct Mail Industry Trends

    Complex, high volume multi-channel campaigns will become the industry standard, driven by enhanced marketing database segmentation tools and widespread CRM adoption.

Nordstrom: “In Australia, multi-channel campaigns have advanced admirably in the past year. Amongst Fuji Xerox customers alone, we have seen some truly innovative use of print, SMS and web pages to create unique, successful CRM campaigns. However, the uptake is slow in comparison with the US. Education is the key. We need to continue to spread the word as to what can be achieved through sophisticated yet very achievable use of multi-level variable data and a variety of communication channels.”

    Forthcoming postal rate increase, combined with new delivery point validation regulations, will drive the need for advanced data hygiene and postal optimisation services.

Nordstrom: “Any direct mail campaign has the potential to be a success if the data is driven by good segmentation and accuracy. In this country, there are definite cost advantages to having an in-depth understanding of Australia Post mailing requirements as well as using bar-coding and regional offerings.

“The direct marketing industry has recently achieved some inroads with changes to Australia Post’s Print Post service that now permits some level of personalisation of publication covers, text pages and advertising.”

    Strategy and creative service providers move to integrate analytics and consumer targeting services with their existing portfolios, in order to counteract the threat of service commoditisation in the agency space.

Nordstrom: “The agencies that achieve the most compelling DM campaigns will definitely be those that consider analytics an integral part of any DM campaign right from the planning stage. Great attention should be given to data segmentation and the associated calls to action or offers for each segment.

“The composition of data and creative to form the variable piece is the most critical stage that can easily be overlooked and is best approached with complete knowledge of the whole campaign.

“Fuji Xerox’s Profit Accelerator initiative is based on the premise that our success is determined by that of our customers. By applying specialist knowledge and skills to enhance delivery, a company’s value is measured by the unique service it provides and commoditisation can be avoided.”

Vertical Market-Specific Trends in Direct Mail

    Media mix reallocation and the proliferation of new channel options threaten direct mail’s budgetary primacy as the preferred below-the-line marketing vehicle.
Nordstrom: “While SMS, web, video and some voice channels have been utilised here, they are still the exception rather than the norm. A little over a year ago, ADMA’s 2005 Direct Marketing and Privacy Report revealed that 89% of those surveyed open direct mail. Around the same time, the Commercial Economic Advisory Service of Australia (CEASA) reported direct marketing as a 1.5 billion dollar market growing at 8.1 per cent per year.

“During 2006, alternate mediums were not anywhere near as visible as DM to pose any immediate threat.”

    Digital print applications, empowered by capability enhancements developed in 2006, grow dramatically throughout 2007.

Nordstrom: “Digital print will undoubtedly continue its impressive development through 2007. Not only does digital print make the personalisation of messages and images possible in a single print run, the resources required to orchestrate large jobs are decreasing and cost-efficient small print runs are more prevalent.

“So too, the revolutionary developments in digital inks and paper dramatically reduce waste; and the improved reliability and increased speeds are making the once impossible possible.”

    Catalog marketers increase or maintain circulation but accelerate the reduction on average page count per book, reflecting the changing role of the catalog and offsetting rising mailing costs.

Nordstrom: “This trend is an indication of the almost ubiquitous use of internet in the US. In Australia, printed catalogues are primarily produced periodically and delivered widespread as “junk mail” by individual vendors or retail organisations. As a result, there should be no visible impact on the catalogue industry here.”

    Inserts and color utilisation play a more significant role in statements, as marketers move to leverage the format for marketing purposes.

Nordstrom: “We too are experiencing this trend. There is growing popularity in companies multi-purposing bills and transactional statements by incorporating personalised marketing messages into these mail outs. Fuji Xerox’s latest state of the art, continuous feed production systems, will enable these types of applications to be produced effectively in full colour.”

    Marketer consolidation (and corresponding service expansion) leads to the increased use of direct mail for branding and promotional purposes.

Nordstrom: “Market consolidation has an undeniable presence in Australia – news of telecommunication, IT, marketing, advertising – even print industry companies seem to merge with notable regularity. Australian print providers must carefully plan and identify opportunities from every angle and those with associations with merging organisations may well find a sweet spot with customer, personnel and stakeholder communications during these major changes.”

Maria Nordstrom concludes, “The US direct marketing industry has long been held as a benchmark of what can be achieved through communication that is both innovative and astute. The best results for the Australian DM industry is surely to learn from those markets more advanced than our own, emulating success and adapting practices to suit our own particular conditions and resources.”

Comment on this article

To receive notification of comments made to this article, you can also provide your email address below.