Direct marketers can't be blamed for thinking something's out of whack when it comes to what's flowing out of their coffers and what's trickling in. They're spending more on most channels, only to see ROI fall in nearly all of them.
Not surprisingly, the highest spending growth forecast by the Direct Marketing Association in the latest edition of its Power of Direct Marketing study is on the less-mature electronic channels. Between 2008 and 2009, commercial e-mail expenditures are seen increasing by 20.7%, followed by a 15.9% rise for non-e-mail Web marketing.
Traditional channels, such as catalog and non-catalog direct mail and insert media, will grow at low single-digit rates. These will be trailed by direct response TV, radio and magazine ads, with telemarketing and DR newspaper ad spending dipping slightly.
If anything, even further cuts in spending on DR newspaper ads might be warranted. Sales from this channel are expected to drop 4.4% — the biggest decline across all categories. Conversely, commercial e-mail and non-e-mail online marketing will experience the greatest gains, with sales from both going up by more than 16%.
E-mail's growth reflects its relative immaturity: Having racked up $28 billion in 2008, the projected $32.6 billion still puts it at the lower end of sales generated by channel. But non-e-mail Internet marketing will inch toward parity with non-catalog direct mail. At a projected $561.7 billion in sales for 2009, direct mail will account for only slightly more than Internet marketing's $559 billion.
Given the differences in projected growth, electronic marketing is poised to take over the top spot with the DMA's next forecast. And well it should — with an estimated 2009 ROI of $19.97 for every dollar spent, it's the only channel expected to boost ROI over 2008. While commercial e-mail will still yield the sweetest fruit at $43.52 per dollar spent, this anticipated return is less than '08's $45.06.
Non-catalog direct mail led traditional advertising channels at $15.50, followed by DR newspaper ($12.46), insert media ($11.56) and DR magazine ads ($10.49). No other channel managed an ROI of more than $9, with DRTV coming in last at $6.72.
