Direct Mail Gains on RivalsDate Submitted: 5/31/2005

Direct mail is becoming more popular with advertisers, The News & Observer (Raleigh, NC) reports. Businesses have more options than ever for their marketing dollars, and many are rethinking their ad strategies to consider newer alternatives, such as the Internet. But direct mail is thriving in this hyper-competitive environment.

The No. 1 reason for its growth is the federal Do Not Call law, Robert J. Coen, senior vice president and ad industry forecasting guru at Universal McCann in New York, told The News & Observer.

With consumers now able to block unwanted sales calls by registering their phone numbers, advertisers are turning to direct mail to reach customers where they live, The News & Observer says. Locally, businesses such as Food Lion, Belk and First Citizens Bank have recently upped their spending on direct mail.

There are other reasons for direct mail's strength: no increase in postal rates since mid-2002; advances in software and hardware that make it easier and less costly to target mailings, The News & Observer reports. It also lets advertisers measure results, such as tabulating how many people use coupons received in the mail, which appeals to companies that want to know what they're getting for their money. Direct mail's market share of US ad spending rose 2.4 percent over the past five years, according to Universal McCann. Meanwhile, broadcast TV, radio, magazines and newspapers have been losing ground.

But at least one of those competitors, newspapers, has found a way to capture some of the direct-mail market -- by offering direct-mail services of their own, The News & Observer says.

Many, including The News & Observer, offer "total coverage" programs that supplement home delivery of the newspaper with a weekly mailing of advertising fliers to non-subscribers. The N&O makes more profit on ads placed in the newspaper, but some companies wouldn't advertise in the paper unless they could also take advantage of its direct-mail services, said Alan Truax, its senior vice president of advertising.

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