DIRECT’s annual survey shows a shift toward more prospecting plus a steady increase in e-mail
THERE ARE SOME substantial changes in the numbers between this year’s reader survey and last year’s. Right up front, the balance between retention and prospecting expenditures has dramatically shifted in favor of prospecting.
This does not necessarily mean that the emphasis on retention has gone down. Companies that had budgeted for elaborate customer relationship management systems during the past few years may have implemented them and are now turning their attention back to prospecting. And CRM efforts, which can be better targeted than prospecting messages, may be more cost-effective – especially as DMers increasingly rely on less-expensive electronic methods to communicate.
But the biggest reason may be that the industry is changing. Due to consolidation, there are fewer mid- to large-sized companies. And the smaller ones that are taking their place (at least, in our survey results) are hungry for customers.
The numbers bear this out. In 1999, respondents to the DIRECT survey averaged $193 million in annual revenue. In 2000, this dropped to $162 million.
So we offer a snapshot of a readership made up of a few more consultants and retailers, and a few less manufacturers and financial service providers. Taken as a whole, they are looking to expand beyond their customer base. Here they come, ready or not…
This survey was conducted for DIRECT by the market research division of Intertec, DIRECT’s parent company. It was mailed to 1,200 DIRECT subscribers chosen on an nth-name basis (a representative sample of all subscribers). An initial copy of the survey, offering a $1 incentive for participation and a chance to win one of three Harry & David gift baskets, was mailed on Aug. 31, 2000. A follow-up copy, along with another sweepstakes offering, was sent to nonrespondents two weeks later.
Results are based on surveys returned by 131 qualified participants.
Respondents identified themselves as manufacturers (14%); publishers (12%); financial services employees (10%); communications workers (6%); retailers (9%); consultants (11%) and printers (2%). The remaining 36% came from such sectors as list services, healthcare, insurance, wholesaling/ distribution and data processing.
The average annual revenue specified was $161.8 million. Current-year revenue reported by survey participants was as follows: under $1 million (30%); $1 million to $2.5 million (8%); $2.5 million to $5 million (6%); $5 million to $10 million (5%); $10 million to $25 million (13%); $25 million to $100 million (18%); $100 million to $500 million (8%); $500 million to $1 billion (1%); and more than $1 billion (12%).
The full results of DIRECT’s 2000 forecast survey, with breakdowns by market category, business size, database size and other classifications, are available on DIRECT’s Web site (www.directmag.com).
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