New results show significant increase in direct mail volumes for the retail sector

New figures today revealed that the retail sector has experienced a 1.1 per cent increase in direct mail volumes.

During the second quarter this year, volumes rose to 88.91 million, up from 87.92 million in the same period in 2005, revealed Royal Mail.

These strong results, reported between April and June 2006, are indicative of the current retail climate. Footfall on the high street suffered dramatically during the World Cup and unusually hot summer weather, and increases of online purchases failed to meet the shortfall.

Furthermore, The British Retail Consortium’s Shop Price Index shows that prices are on the rise. August 2006 is the second month the inflation rate has shown a significant year on year increase (1.4 per cent). Much optimism is also predicted for the rest of the year, with Royal Mail’s new pricing structure (Pricing in Proportion) enabling retailers who post more than 90 per cent of their products to save money on two thirds of their mail on average; a saving which could then be re-invested into further direct marketing activity.

Interestingly, there has also been a significant lift in volume of direct mail sent to the 55-64 age bracket. This is a result of the marketing community identifying the ‘grey market’ as a responsive and valuable target audience.

Catherine Campbell, Head of Multi Channel Retail, Royal Mail, said: “The retail sector is showing encouraging growth in direct mail volumes. The statistics are a great indicator of the effectiveness of the mail as a communication tool.

“Retailers continue to recognise the benefits of using direct mail as a way to build their brand and create customer loyalty by educating their customers on their products and services, as well as to actually drive sales. Direct mail provides a cost effective way for retailers to communicate with existing and potential customers on a one-to-one level.”

Other sectors to perform well are the automotive industry with a year on year volume increase of 12.3 per cent to 12.32 million items, charities with an increased volume of 10.5 per cent to almost 97 million items, and the travel and tourism sector recording an uplift of 7.8 per cent.

The overall direct mail volumes during April – June 2006 have experienced a slight drop in comparison to the same period in 2005, as businesses across all sectors improve targeting by moving away from ‘blanket mailings’ towards greater segmentation of consumers. This enables them to send lower volume, more relevant campaigns to their prospects. As a result, direct mail volumes in general have fallen by 1.6 per cent from 1.329 billion in 2005 to 1.307 billion this year.