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Many challenges are plaguing direct mail today; high postage costs, diminished consumer response rates and increased mailbox "clutter" are all impacting campaign ROI. The solution? Look at optimising the postal process. That's the finding of a new white paper released today by Winterberry Group.
The white paper, titled 'A Strategy for Savings: Postal Optimization and the Future of Direct Mail', explores opportunities now emerging around the development of comprehensive postal optimisation strategies, which integrate multiple cost-saving direct mail production techniques like commingling, copalletisation and drop-shipping, in a manner that drives unique incremental value for all mailing sizes.
Sponsored by Direct Group, the paper explores both the leading drivers of postal optimisation adoption, as well as the factors that are expected to continue supporting expansion of the practice in coming years. The report includes the following findings:
Driven by both rising rates and several years of severe price compression among marketing service providers, postage costs are growing to assume a more significant proportion of direct mail budgets.
General maturity of the direct mail channel and heightened competitive intensity in several mail-dependent vertical markets have conspired to depress typical direct mail response rates, forcing marketers to re-evaluate the approach by which they derive value from the channel.
Mounting pressure to adopt environmentally-friendly business practices has focused attention on the reduction of direct mail waste—including both undeliverable packages and those that ultimately fail to achieve a specified marketing objective.
Though widespread understanding of postal optimisation and its high-level benefits finally reached an industry-wide "tipping point" about 18 months ago, many marketers—including several of the nation's largest direct mailers—have yet to fully integrate a comprehensive postal optimisation execution plan into their long-term direct mail strategy.
Effective postal optimisation execution requires the integration of multiple tactical tools, potentially including data hygiene, commingling and various logistics solutions depending on the marketer and the specific needs of its direct mail program.
Reduced postage rates may provide the initial motivation for investment in postal optimisation, but a wide range of ancillary benefits—including improved targeting capability, enhanced flexibility with regard to mail timing and significant potential reduction in "waste mail" expense—may ultimately emerge as more significant long-term benefits.
While the report data is based on the US market, these findings are also just as relevant to other countries, as we are witnessing a similar global trend.
The full report is available for complimentary download from the research page of Winterberry Group's Web site.
Posted on Tuesday, 25 March 2008 at 10:24 PM | TrackBack: http://www.veedeepee.com/cgi-bin/mt-tb.cgi/108