Here’s the mail, it never fails. It makes me want to wag my tail. When it comes, I want to wail maaaaaiiill!!!!

Direct mail is playing an ever-larger role in promotion. Whether for coupons or sample distribution, building buzz for product discounts or driving consumers to the Web to try online sweeps, direct marketing is the name of the game.

In fact, U.S. spending on direct mail is projected to grow 16% from $51.4 billion last year to $59.6 billion in 2007. Spending on consumers will reach $35.1 billion, up 17.4% from $30.5 billion; expenditures to reach businesses will jump 15.1% to $24.5 billion from $20.9 billion, according to the Direct Marketing Association.

Of all the tactics listed in PROMO’s 2005 Industry Trends Report, marketers most often cited direct mail (37.5%) as a top spending priority last year.

And it works for a broad assortment of brand categories. Direct mail is a critical component of Harrah’s Entertainment’s marketing strategy and drives most of its revenues, largely tracked back to mailings to members of its loyalty program, Total Rewards.

The casino hotel operator mails about 150 pieces per year to its millions of members with offers that include hotel discounts, coupons to redeem for $10 cash, invitations to special events and other promotions.

The mail pieces are “highly customized” based on Harrah’s rich customer database.

For example, last year Harrah’s replayed a successful promotion where winners dig in the Las Vegas desert to find $1 million. About $20 million was spent on advertising the event ncluding direct mail to all of its active customers.

“Our customers really appreciate that we recognize where they are in the life cycle and can recognize that relationship and talk to them in a very specific manner giving them offers that are relevant,” says David Norton, senior VP-relationship marketing for Harrah’s Entertainment, Las Vegas.

Sales generated by direct mail totaled $747.6 billion in 2004 and are expected to rise to $954.7 billion in 2007. B-to-C sales reached $457.3 billion last year and B-to-B sales totaled $290.3 billion, the DMA found.

Response rates to direct mail lifted slightly to 2.73% in 2004 from 2.54%. A few industries — wholesale trade (7.5%), entertainment and recreation (5.29%) and eating and drinking establishments (4.50%) reported the highest response rates, but based on very small samples. The industries that used direct mail to the greatest advantage were nonprofit fundraisers (4.42%), consumer packaged goods (3.11%) and retail stores (3.03%), the DMA said.

Last year, the American Institute of CPAs took first place in the 2004 PRO Awards in the direct marketing category for its Catch Me if You Can promotion, part of a $25 million five-year multi-media push to generate interest and excitement among high school and college students for considering a career in accounting.

At startheregoplaces.com, the hub of the campaign, the online gaming contest, Catch Me if You Can, let students solve 12 forensic accounting mysteries to vie for cash prizes. Direct marketing targeted professors and 900,000 business, accounting, IT and economics majors driving them to the site. More than 10,000 students registered, three times 2003 participation levels. More than 6,000 opted for more info.

At the time, the judges said: “Very clever work in a boring field.” “It was ‘Revenge of the Nerds’ — it added drama to a dry profession.”

Louise Hraur De Sina, the director of advertising and communications for the American Institute of CPAs, says that direct marketing — including direct mail and e-mail — played a key role in the program.

“It is the engine that drives the campaign,” she says. “It is the vehicle that gets the students to the Web site. It allows us to build the relationship between the CPA profession and the high school and college students.”

To date, the program has generated more than 800,000 respondents and is set to launch its newest element, a custom published magazine, Start Here. SNAPSHOT 2004

Consumer direct mail up 17.4% in 2004, to $35.1 billion in the U.S.

B-to-B direct mail up 15.1% in 2004, to $20.9 billion

37.5% of brand marketers put direct in their top three spending tier

Sales via direct to reach near $955 billion by 2007

Direct mail is playing an ever-larger role in promotion. Whether for coupons or sample distribution, building buzz for product discounts or driving consumers to the Web to try online sweeps, direct marketing is the name of the game.

In fact, U.S. spending on direct mail is projected to grow 16% from $51.4 billion last year to $59.6 billion in 2007. Spending on consumers will reach $35.1 billion, up 17.4% from $30.5 billion; expenditures to reach businesses will jump 15.1% to $24.5 billion from $20.9 billion, according to the Direct Marketing Association.

Of all the tactics listed in PROMO’s 2005 Industry Trends Report, marketers most often cited direct mail (37.5%) as a top spending priority last year.

And it works for a broad assortment of brand categories. Direct mail is a critical component of Harrah’s Entertainment’s marketing strategy and drives most of its revenues, largely tracked back to mailings to members of its loyalty program, Total Rewards.

The casino hotel operator mails about 150 pieces per year to its millions of members with offers that include hotel discounts, coupons to redeem for $10 cash, invitations to special events and other promotions.

The mail pieces are “highly customized” based on Harrah’s rich customer database.

For example, last year Harrah’s replayed a successful promotion where winners dig in the Las Vegas desert to find $1 million. About $20 million was spent on advertising the event ncluding direct mail to all of its active customers.

“Our customers really appreciate that we recognize where they are in the life cycle and can recognize that relationship and talk to them in a very specific manner giving them offers that are relevant,” says David Norton, senior VP-relationship marketing for Harrah’s Entertainment, Las Vegas.

Sales generated by direct mail totaled $747.6 billion in 2004 and are expected to rise to $954.7 billion in 2007. B-to-C sales reached $457.3 billion last year and B-to-B sales totaled $290.3 billion, the DMA found.

Response rates to direct mail lifted slightly to 2.73% in 2004 from 2.54%. A few industries — wholesale trade (7.5%), entertainment and recreation (5.29%) and eating and drinking establishments (4.50%) reported the highest response rates, but based on very small samples. The industries that used direct mail to the greatest advantage were nonprofit fundraisers (4.42%), consumer packaged goods (3.11%) and retail stores (3.03%), the DMA said.

Last year, the American Institute of CPAs took first place in the 2004 PRO Awards in the direct marketing category for its Catch Me if You Can promotion, part of a $25 million five-year multi-media push to generate interest and excitement among high school and college students for considering a career in accounting.

At startheregoplaces.com, the hub of the campaign, the online gaming contest, Catch Me if You Can, let students solve 12 forensic accounting mysteries to vie for cash prizes. Direct marketing targeted professors and 900,000 business, accounting, IT and economics majors driving them to the site. More than 10,000 students registered, three times 2003 participation levels. More than 6,000 opted for more info.

At the time, the judges said: “Very clever work in a boring field.” “It was ‘Revenge of the Nerds’ — it added drama to a dry profession.”

Louise Hraur De Sina, the director of advertising and communications for the American Institute of CPAs, says that direct marketing — including direct mail and e-mail — played a key role in the program.

“It is the engine that drives the campaign,” she says. “It is the vehicle that gets the students to the Web site. It allows us to build the relationship between the CPA profession and the high school and college students.”

To date, the program has generated more than 800,000 respondents and is set to launch its newest element, a custom published magazine, Start Here.

SNAPSHOT 2004

Consumer direct mail up 17.4% in 2004, to $35.1 billion in the U.S.

B-to-B direct mail up 15.1% in 2004, to $20.9 billion

37.5% of brand marketers put direct in their top three spending tier

Sales via direct to reach near $955 billion by 2007

The U.S. Postal Service, Washington, DC, in January initiated a review that seeks to consolidate all advertising and marketing services activity at a single agency.

Consolidated duties include strategy, creative and production, media planning and buying, direct marketing and sales support, and retail display work. The 2001 budget for those activities was $104 million.

Since a September 2000 reassignment, Leo Burnett has handled advertising, FCB Worldwide direct marketing and interactive, Grey Global Group media, and Frankel retail.

USPS is now looking for one shop “that will foster consistency and efficiency in our advertising program while realizing significant cost savings,” according to its prequalification notice. It will also “implement a performance-based compensation program based upon quantifiable, measurable performance indicators.”

The Postal Service expects to complete the review in June by awarding a one-year contract with options for five more years. The review does not include ethnic marketing, which is handled by specialist shops.

The news came as a shock to Chicago-based Frankel, which had cut 100 positions just a few days earlier as part of an expected reorganization (February PROMO).

The top-to-bottom restructuring — which included the departure of president Dan Rose — was designed to eliminate layers of both management and low-level administration by uniting once-separate client teams into two larger groups that share resources. The change also “frees up more senior people to work on accounts” rather than focusing on managerial obligations, says ceo Jim Mack.

The two account groups are headed up by senior vps: Kathy Hartman will oversee work for the USPS, McDonald’s, and the Centers for Disease Control, while Eric Rosenthal manages United Airlines, Visa, AT&T Wireless, and Tropicana.

Elsewhere, executive vp Pam Church took on a new role as head of an Insights and Ideas group that will work on all accounts; Frankel vet Bill Rosen returned after a two-year hiatus to become chief creative officer (replacing Brian Robinson, who retired last fall); and cfo Jim Farmer added chief operating office duties (from Rose). Executive vp Dick Thomas remains in charge of new business development and Ray Damiano continues as head of the Irvine, CA, office.

Frankel cut about 75 positions in 2001 through two rounds of layoffs. In addition, more than 100 former staffers were transferred when parent company Publicis spun out the shop’s Siren and BrandGuard technology units into a separate operation called MarketForward. Total headcount, which peaked at about 740 in late 2000, now stands at 400.

A Frankel spokesperson said the agency plans to vigorously pursue the USPS account, and would consider a joint pitch with shops in the Publicis network as a way of offering all capabilities spelled out in the RFP.

Simon Says What?

The end of the line for Simon Worldwide seemed to draw a little nearer with word that Chevron Corp. — the last known client being serviced from the agency’s Oak Brook, IL, office — had moved its business to Wunderman, Chicago. Published reports also said Wunderman stole away Simon execs to work on the account.

Simon also made news recently by dismissing a lawsuit it filed last fall against Philip Morris after the long-time client dismissed the shop when news broke of the McDonald’s gamepiece scandal (October PROMO).

Similarly, an attorney for embattled Simon told the Associated Press in January that the agency was negotiating to settle some parts of its counter-suits with McDonald’s — although at least a portion of its suit against the chain would move forward (December PROMO).

GEM Mining

The GEM Group scored itself a New York City office and bolstered its entertainment marketing expertise by adding Vertical Mix Marketing to its agency network.

Vertical Mix’s 30-employee office will serve as HQ for a GEM Entertainment division that will spearhead sports and entertainment marketing programs for clients, serve as a consultant to entertainment companies, and build strategic alliances. Vertical Mix ceo John Zamoiski becomes president of the new group.

Founded in 1995, Vertical Mix has a client roster focused heavily on broadcast companies including AOL Time Warner, A&E Network, NBC, and Showtime. The shop ranked No. 40 on the 2001 PROMO 100 with 2000 net revenues of $4.4 million.

Two-year-old GEM Group, formed through the merger of Lang & Associates in Toronto and Corporate Marketing Associates in the U.S., is building a network of shops that can provide a full complement of marketing services.

“We had grandiose plans to do it in three days. But it’s hard,” laughs ceo Rick Jones. The drop-off in the IPO market forced a need to seek private funding, which led to last summer’s acquisition by London-based sports and entertainment management company CSS Stellar for $30 million.

Anyone noticing a pattern here? “At the end of the day, just about every promotion you do has some kind of content component,” says Jones. “So a disproportionate amount of it is sports- and entertainment-related.”

Part of the plan is to wed the talent and properties in the CSS portfolio with clients in the U.S. — in a small-scale version of what New York City-based Clear Channel Entertainment is doing (September 2000 PROMO).

7-Eleven Update

Dallas-based 7-Eleven Corp. in February ended a four-month review by naming GSD&M as the first advertising agency of record for its $25 million-plus account.

Bob Merz, the chain’s executive director of marketing (and PROMO’s February cover subject) says GSD&M will immediately begin work on a few project assignments.

Merz told PROMO last month that he is placing a heavy emphasis on promotional advertising. “We needed an agency that would build the brand and sales at the same time,” he says of the selection. The Promotion Network, Dallas, was named chief promo shop last summer.

Merz also put to rest rumors about the chain’s longtime “Thank Heaven for 7-Eleven’s” tagline retiring: It won’t.