Why Direct Mail Spending is Suddenly Collapsing

After Surprising Resilience Over the Past Decade, Direct Mail Spending is Suddenly Collapsing. Some say it's about time. Others are left wondering if it means a digital tipping point has been reached?


Direct Mail Spending the Last 20 Years

As we watched spending on traditional media flatten or fall across a number of major media categories since 2000, direct mail spending had a strange resilience.  Until the pandemic…

As lock-downs captured the headlines, all major retailers quickly ended a decades-long tradition of weekly FSIs (free standing inserts).  And that sudden change seems to have begun a cascading collapse of print and direct mail spending.  The collapse was surprising for its speed, more than the fact it was happening.

Why Direct Mail Persisted So Long

Direct mail spending continued to grow, even as other traditional forms of media (radio, television, outdoor, etc.) all took hits in favor of digital alternatives.  This was due to several tail winds:

  • USPS made direct mail even more affordable and efficient with the evolution of the Every Door Direct Mail service (EDDM)
  • It still worked, and continues to work well for certain business categories
  • Direct Mail is easy for advertisers to understand and assess

What are the Head Winds?

Direct Mail’s demise is largely due to demographic shifts.  The younger we are, the less likely we are to consider direct mail influential in purchasing decisions:

Direct Mail Influence By Generation

Generation                   Recall of Direct Mail

Boomers                        12 %
Gen X                            8 %
Millennials                      4 %
Gen Z (18+)                  3 %
Gen Z (13-17)                3 %

And it makes sense.  Millennials were practically digital natives (most), and don’t even remember major marketing channels like Yellow Pages.  Gen Z is the first generation that grew up with tablets and smart phones from birth.  So direct mail influence by generation has suddenly caught up to the rest of the digital transition.


Where is Direct Mail Spending Going?

Influencers and social media perform stronger with Millennials and Gen Z.  But the spending hasn’t shifted quite as dramatically to just those emerging categories.

Video advertising and more localized forms of digital display advertising, such as Geo-Fencing and Search Re-Targeting have captured parts of direct mail spending, too.  And Contextual Advertising is emerging as a strong competitor.

Need an Alternative to Direct Mail?

If you’ve been using direct mail and it’s just not working like it used to, we may be able to help.  And we’re willing to explore that question without any obligation from you, other than your time.

Schedule a free initial consultation with our team.  We’ll get to know you and your business a bit better, and hear you describe your challenges and goals.  We’ll show you how we develop and test strategy for success.

Not ready?  That’s OK.  Subscribe to our free e-mail newsletter so you can keep up with more articles like this, and keep in touch.

Thanks for visiting today.

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After 3 decades as a professional marketer, serial entrepreneur and business consultant Steven Ludwig shares his best practices for small business marketing for owners, managers, and marketers with limited time, money, and expertise. Steven started his professional marketing career in broadcasting in the early ‘90s in Chicago after attending Valparaiso University. After a brief stint at an advertising agency specializing in entertainment and sports marketing where he worked with radio and television stations, movie theatre companies, record labels, musicians, and professional sports teams, he moved to Nashville to form The Marketing Group with his long-time business partner, Jim Wood. Having worked with some of the largest brands in the world, in 2010 he returned to local marketing primarily out of an interest and excitement for working with small business owners to build stronger companies. That desire comes out of early days in radio, where he worked closely with everything from car dealerships to restaurants, insurance and real estate agents, banks, home services companies, and specialty retailers of all kinds. Over the past decade, he has been on the bleeding edge of digital marketing technology, constantly seeking to understand complex strategies employed by giant corporations and then translate those capabilities into tactics small businesses can execute at a local level. Today, in addition to other business ventures with his wife and other long-time business partners, he still lives outside Nashville in Franklin, Tennessee and currently serves as Executive Chairman of EmpowerLocal, a digital marketing company building a nationwide network of digital, hyperlocal news and lifestyle publishers to provide efficient advertising opportunities for local, regional, and national brands.


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