“As shown by a study led by Royal Mail, with more people at home, direct mail matters more and is driving online transactions more than ever,” the UPU Direct Marketing Advisory Board (DMAB) wrote in its new report titled, “COVID-19, Posts and Direct Marketing.”
The DMAB is comprised of postal operators, private-sector companies and industry associations.
Building on exclusive insights from direct marketing markets players, including among the biggest postal stakeholders in the world (The United States Postal Service and China Post) and leading industry associations, the UPU report provides an in-depth analysis, the way forward and highlights opportunities for direct marketing during and after the pandemic.
Similar to global mail volumes, direct marketing saw a downturn due to the COVID-19 pandemic. But, as with the 2008 financial crisis, posts may help revive direct marketing as economies recover, according to the report.The report shows that physical direct mail remains a core business for Posts (80 per cent of designated Operators provide the service), while the current pandemic and the growth of E-commerce have accelerated the need for Posts to position themselves as the consolidators of physical and digital services in the direct marketing space.
Direct marketing declined in most markets. In the United States, 2020 second-calendar quarter volume dropped by 36.4 per cent compared with the same period in 2019. Despite increased or maintained volumes in the insurance and non-profit markets and political mailings, the retail, entertainment, travel and financial sectors all cut their programs significantly.
Similar declines were seen during the 2008 crisis when real estate, mortgage and credit cards essentially halted all marketing. Once those industries recovered, direct marketing programmes resumed.
As businesses regain momentum after the pandemic, they will continue to need a platform to build brand recognition and engage customer audiences, the report stressed.
Posts and suppliers must help customers make a compelling business argument for their investment in direct marketing competitive media channels, such as advanced TV, will challenge direct mail as a platform for driving new customer acquisition. Still, consumers have rallied behind posts as a means of national and global communication, equality and interconnectedness, the report said.
More than ever, “innovation, integration of offline and online channels and data will be key components in the post-covid-19 direct marketing reality” where direct marketing will be promoted again as “a winning tool that will expedite the much-expected recovery”, the report stressed.