Spend on direct mail tumbles 7.2% in first quarter of 2005

by Jennifer Whitehead, Brand Republic 21-Jun-05, 07:00

LONDON - There has been a fall in spend on direct mail during the first three months of the year, down by 7.2% to £636m according to figures released this week, the biggest fall of any medium surveyed.

The figures were published in the Advertising Association's Quarterly Survey of Advertising Expenditure, compiled by the World Advertising Research Center.

They look at direct mail only, and not other forms of direct marketing such as door drops and direct email.

The figure represents an 8.8% decline in real terms on last year's level. However, Melanie Howard, a director of the Future Foundation, said that the figures were more likely to be a blip than signs of a move away from direct mail.

The Future Foundation recently carried out research showing that just over 30% of companies have increased their current year's direct marketing budget compared with the previous year, and 22% planned to spend more on direct marketing than budgeted in the current year.

"Our research shows that there is no crisis in direct mail, and indeed that direct marketing as a whole is in a healthy state," Howard said.

There are a number of likely causes for the fall, including an improvement in targeting and a decline in mail sent by financial services companies.

The survey showed that across the board, advertising expenditure in the UK rose by 5.3% to £3.99bn.

It showed that spend on television advertising was up by 13.6% in current prices, a rise of 11.7% in real terms. Hits from the first three months include Channel 4's 'Celebrity Big Brother', won by Bez from the Happy Mondays, and US import 'Desperate Housewives'.

Other sectors to perform well were cinema, up 18.8% with the release of hits such as 'Sideways' and 'Meet the Fockers', and outdoor, up 14%. Internet advertising continued to be the strongest performer with figures showing a rise of 51.5%.

A decline was also seen in business magazines, which showed a 2.7% decline, measured as 4.3% in real terms.

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