Aug. 27 2009 02:28 PM

At a recent gathering of our neighborhood condo group, I asked a neighbor if they subscribed to the New York Times, as I would like to read it when they were finished. (I'm a little on the cheap side.) He responded that he didn't get the actual Times but subscribed online - adding that the online version was free. My response - and the response from the majority gathered - was that they didn't want their newspapers online; they wanted to "kick back" and read an actual printed product.

As the discussion continued it expanded into print in general and specifically e-marketing (referred to in this discussion as spam). Pretty much everyone agreed that they considered most all e-marketing as intrusive and a general pain. They would much rather get marketing pieces in print, either as newspaper ads or as direct marketing pieces. They didn't have a problem with businesses maintaining the relationship via "e," but for the initial contact, they preferred print. One mentioned that they were surprised how things had changed - adding, "only spam (e-marketing) could make direct mail popular." All in all, a very enlightening and interesting discussion. The bottom line: Print advertising is still a very attractive option, and probably the most attractive from a recipient's point of view.

Unfortunately, the story didn't end there. At this same gathering was an executive of a major retail clothing firm with a nationwide in-store and online sales and distribution function. He stated that they still used some direct mail marketing but they recently had to abandon their mass distribution of catalogs due to postage costs. (We're talking many millions of pieces here.) The latest rounds of regulation changes and postage rate increases for catalogs were just too much - they simply couldn't justify the expense vs. sales. His comments really hit home to me. Here was a real-life example of a major mailer saying "no more."

First Class Mail revenue is in real trouble. With transactional mail going away (bills and statements are products that do fit with "e" very well), the revenue "cash cow" of the U.S. Postal Service will no longer carry the load. It will fall to direct marketing and parcel products to do the job. Obviously, raising rates to collect more revenue will not work. Adding cataloger costs by adding more regulations will not work. It is up to the USPS - the entire USPS, labor as well as management - to find ways to cut costs.

I wish I could say, "Not to worry, everything's going to be fine," but I can't. The key to keeping print advertising viable is going to be cost containment. If the cost of direct marketing keeps rising, it will not matter what the recipient prefers, marketers will simply not be able to afford print marketing. Without innovative and significant cost cuts, it's "game over" for the USPS as we know it!

As always, thanks for reading Mailing Systems Technology.