U.S. businesses sent 81 billion pieces of direct mail in 2016 creating several touch points with their prospects and customers, accounting for roughly 53 percent of all mailpieces delivered by the United States Postal Service.
In an era of omni-channel communications, marketers continue to use direct mail channel primarily due to its response rates — 28 times higher than email, 32 times higher than display ads, and 5.8 times higher than paid search, according to the Data and Marketing Association.
Direct mail marketing spend is seeing an uptick, with an estimated $57 billion in 2016. The physical direct mail-piece is complemented with integrated omni-channel marketing efforts to engage customers both online and offline. Direct mail marketing of today is more targeted, sophisticated, and more effective thanks to affordable high-quality digital printing and big data technologies.
Bell and Howell wanted to focus specifically on direct mail marketing service providers to understand key players in this space — their opportunities, challenges, and their transformation into the digital realm. We created DM 200, the first-of-its-kind ranking of the top 200 direct mail service providers by estimated sales revenue.
One of the key takeaways from the research is that traditional printers that provide direct mail services are growing faster than those that do not offer them — at about 8 percent versus 1 percent, respectively. Direct mail marketing continues to be a very dynamic space and it provides numerous opportunities for traditional print providers to expand their service offerings. Print and mail service providers should enhance their value proposition surrounding direct mail by offering personalization, mobile, online/offline integration, and end-to-end multi-channel solutions that can effectively engage and measure customer experience.
Examples of Companies on the DM200 List
For 2017, Minnesota-based IWCO Direct ranks as the number one direct mail service provider in the U.S. Producing more than four billion mailpieces annually, the company recently built upon its foundation and extensive expertise in direct mail to expand its service offerings to include sophisticated strategy and creative services for all channels. It now creates highly-coordinated, data-driven direct marketing campaigns that combine digital and paper-based communications to reach the right customers at the right time through the right channel to drive results.
“Direct mail taught us valuable lessons about data, dynamic content, speed-to-market, lifecycle marketing, and many other factors that are necessary for multichannel marketing success,” IWCO Direct CEO Jim Andersen said. “We’re combining all this knowledge to develop strategies and execute tactics that help our clients create new customers and build stronger loyalty using the most appropriate channels to reach their target audiences.”
Illinois-based SG360°, which ranked third, has been delivering direct marketing solutions for more than 60 years. It leverages the power of print to create connected experiences by integrating direct marketing across all channels.
Vision Graphics Group, also from Illinois, ranked 19, and has had the unique opportunity to be at the forefront of many industry changes during the last 60 years. As technology has evolved, the company too, has evolved its traditional printing operations by developing methods and solutions that address the growing needs of clients. What was once a traditional printing operation has now grown into a leading on- and offline marketing solutions provider servicing clients nationwide.
Moving Towards Digital
The print and mail service industry is experiencing an unprecedented transition from physical to digital communication. This dynamic shift has made it necessary for them to play a larger role in the marketing value chain by offering a broad range of marketing services. This opens the door for those providers to transform their businesses and expand their capabilities beyond print to address these new opportunities.
Bell and Howell intends to publish this report annually along with key insights into the industry. We will be watching over the coming years to see which of these companies will prosper, and if that can be attributed to expanded direct marketing services.
Download the complete DM200 list to view total revenue, direct marketing revenue and other information on each company. Get more information about Bell and Howell's Direct Mail Solutions.