The marketing industry “must continue to improve its creative approach and use of data to ensure that direct mail remains relevant and of interest to consumers” to avoid being seen as junk mail, according to Chris Combemale, executive director of the Direct Marketing Association.
Combemale’s warning comes off the back of the news that half of all letters delivered by Royal Mail are marketing communications. He adds: “Poor consumer insight leads to junk mail, which is bad for business. Cutting out unnecessary direct mail marketing will help to not only change consumer perceptions but also improve companies’ return on investment.”
The increase in marketing mail follows the removal of a “junk mail” cap which restricted postal workers to delivering a maximum of three unaddressed mail items per household each week.
Royal Mail chief executive Moya Greene confirmed that one in two of the 54 million items Royal Mail delivers every day is now marketing mail paid for by companies accounting for half of all mail, a significant rise from the 2008 figure of a quarter.
She explained that these marketing communications were “very important” to the success of the postal services as the number of traditional letters continues to decline, in the six months to the end of September Royal Mail recorded a fall of nine per cent in the number of addressed letters being sent.
In the same six month period the number of unaddressed letters rose from 1.54 billion to 1.6 billion.
According to Greene marketing communications account for £1.1 billion of revenue for Royal Mail, she added that the postal service was “poised to increase” its share of the £16 billion that companies spend each year on advertising.
Royal Mail, in fact, launched MarketReach in the summer, with the specific aim to boost its direct marketing arm.
Combemale continued: “Direct mail is highly effective. According to DMA research, companies will invest £2.43bn in the medium this year and Royal Mail estimates that every pound spent generates a further £3 pounds in revenue.
“We see Royal Mail's belief in advertising mail is a great growth opportunity for the industry.”
Along with these figures Royal Mail has posted strong financial results for the six months to 23 September 2012. The group made a total profit of £99 million compared with a loss of £41 million the previous year. Revenue also rose by £209 million to £3.6 billion.