Big Business in the US
Good prospects for direct marketing campaigns
December 2006By Klaus M. Knappik and Dr. Diane Rinas (published in the trade journal DIREKT MARKETING, December 2006 issue)
The United States of America is the world's greatest economic power, contributing approximately one fifth of the world's annual income. The US benefits, in particular, from having a huge territory rich in raw materials and a large internal market with approximately 200 million, mostly wealthy, consumers. In addition, the economic and financial system is characterized by entrepreneurial initiative and free trade.
The US economy is currently on a solid expansionary path, despite rising energy prices, higher interest rates and a growing risk of inflation. Experts anticipate a rise in gross domestic product of around 3.5 percent in 2006. At the same time, forecasts indicate that private consumption will increase by 3.3 percent. That underpins the economy and creates good conditions for direct marketing campaigns.
In the surveys conducted by Direct Marketing Monitor International 2006, published by Global Mail, 46 percent of respondents state that they receive advertising mailings at least once a week. The mailing density thus corresponds more or less to the average in American-Pacific reference countries such as Australia, Brazil, Canada and Mexico. In terms of the response behavior to mailings, the following picture emerges: 85 percent of advertising mailing recipients can be described as having an affinity to mailings because they read their mailings at least occasionally. 27 percent read their and who respond to their mailings at least once a year. Those who have an affinity to mailings include, in particular, persons who have completed less than ten years of schooling (93 percent) and female consumers (90 percent).
In the surveys conducted by Direct Marketing Monitor International 2006, published by Global Mail, 46 percent of respondents state that they receive advertising mailings at least once a week. The mailing density thus corresponds more or less to the average in American-Pacific reference countries such as Australia, Brazil, Canada and Mexico. In terms of the response behavior to mailings, the following picture emerges: 85 percent of advertising mailing recipients can be described as having an affinity to mailings because they read their mailings at least occasionally. 27 percent read their and who respond to their mailings at least once a year. Those who have an affinity to mailings include, in particular, persons who have completed less than ten years of schooling (93 percent) and female consumers (90 percent).
Only a few direct marketing service providers, such as DHL Global Mail, have a large network in the US. This, combined with the knowledge of country-typical features, enables service providers to assist companies in properly designing and distributing their direct advertising mailings.
In the regular readers category, women are also well-represented, making up 32 percent of this group, as are single households (33 percent) and low earners (40 percent). Households of at least four persons (63 percent), school goers or people who have not completed their education (62 percent) and higher earners (61 percent) have a particularly high propensity to respond. Among the 57 percent of consumers who are willing to respond, the preferred response medium is the reply card (67 percent), followed by the telephone (59 percent) and e-mail (50 percent). The fax (13 percent) is hardly ever used as a response medium.
The essential thing is the content of an advertising mailing, in other words, enclosures such as vouchers and coupons. These are important to 64 percent of respondents who are willing to respond. American consumers are distinguished, in particular, by a high level of brand awareness. That is why 35 percent of the consumers interviewed put their faith in well-known senders. The latter enjoy greater trust, particularly among consumers who have an affinity to mailings - 32 percent of men and as many as 47 percent of women. For smaller and less well-known companies, this certainly does not mean, however, that they stand no chance. They can make a name for themselves in the truest sense of the word by including samples or vouchers in their mailing. The reason for this is that 35 percent of Americans also like receiving them. This applies to an even greater extent to the category of women who have an affinity to mailings, who companies can reach particularly effectively by including coupons and vouchers (47 percent and samples (45 percent).
In the US, there is huge pressure from advertising. So it comes as no surprise that American consumers are less receptive to all forms of advertising than consumers in comparable American-Pacific countries. That applies both to print advertising (19 percent compared to 32 percent) and TV commercials (14 percent compared to 25 percent) and to mailings (8 percent compared to 18 percent).
This makes it all the more important to target specific target groups. The reason being that if you are familiar with the consumption patterns of your target group, you increase your chances of achieving a positive response rate enormously.
What do mailings need to look like to be successful with consumers?
The essential thing is the content of an advertising mailing, in other words, enclosures such as vouchers and coupons. These are important to 64 percent of respondents who are willing to respond. American consumers are distinguished, in particular, by a high level of brand awareness. That is why 35 percent of the consumers interviewed put their faith in well-known senders. The latter enjoy greater trust, particularly among consumers who have an affinity to mailings - 32 percent of men and as many as 47 percent of women. For smaller and less well-known companies, this certainly does not mean, however, that they stand no chance. They can make a name for themselves in the truest sense of the word by including samples or vouchers in their mailing. The reason for this is that 35 percent of Americans also like receiving them. This applies to an even greater extent to the category of women who have an affinity to mailings, who companies can reach particularly effectively by including coupons and vouchers (47 percent and samples (45 percent).
A special challenge for advertising companies
In the US, there is huge pressure from advertising. So it comes as no surprise that American consumers are less receptive to all forms of advertising than consumers in comparable American-Pacific countries. That applies both to print advertising (19 percent compared to 32 percent) and TV commercials (14 percent compared to 25 percent) and to mailings (8 percent compared to 18 percent).This makes it all the more important to target specific target groups. The reason being that if you are familiar with the consumption patterns of your target group, you increase your chances of achieving a positive response rate enormously.
A mailing's success also depends on the product being promoted. The area of fashion, for instance, is right at the top of the popularity stakes with mailing recipients who are willing to respond. Almost one in three (31 percent) is interested in shoes and clothing, while the figure for all respondents is one in four (25 percent). Wellness and health are also top of the agenda with American consumers (34 percent).
The proportion of those willing to respond to mailings is 44 percent and roughly corresponds to the American-Pacific average of 45 percent. 34 percent of all respondents and as many as 39 percent of those who are willing to respond to mailings are enthusiastic about entertainment media. The proportion of women, at 56 percent, greatly exceeds that of men (44 percent). Two other areas that meet with a great response in the US are entertainment and culture. 31 percent of all respondents and as many as 38 percent of those who are willing to respond are interested in them.
Klaus Knappik, Chairman of the MAIL International Divisional Board, Deutsche Post World Net
Dr. Diane Rinas, Senior Marketing Manager, Deutsche Post World Net
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The proportion of those willing to respond to mailings is 44 percent and roughly corresponds to the American-Pacific average of 45 percent. 34 percent of all respondents and as many as 39 percent of those who are willing to respond to mailings are enthusiastic about entertainment media. The proportion of women, at 56 percent, greatly exceeds that of men (44 percent). Two other areas that meet with a great response in the US are entertainment and culture. 31 percent of all respondents and as many as 38 percent of those who are willing to respond are interested in them.
Americans' preferences
As a rule, American consumers show themselves to be very loyal to their brands. 77 percent of all respondents and 84 percent of those who are willing to respond will remain loyal to a brand if they are satisfied with it. Another selling point for Americans is the quality of a product (55 percent). This is even more important to them than price (43 percent). That probably also applies to mail-order purchases. As surveys conducted by Direct Marketing Monitor International 2006, published by Deutsche Post Global Mail, show, mail-order companies are hugely popular in the US. 63 percent of American consumers state that they have ordered products from mail-order companies during the past year. This puts them above the American-Pacific average. People aged between 30 and 50 (68 percent), respondents with a better education (66 percent), two-person households (67 percent) and higher earners (75 percent) have a particular affinity to mail-order companies. The consumer barometer in the US is rising steadily. However, the advertising market is hotly contested. For that reason, companies wishing to advertise there should definitely take into account the special, country-typical characteristics. The only way to win over consumers is by using a targeting approach that is appropriate for the target group. This is particularly important in a country in which a large number of ethnic groups live because, depending on their cultural background, they may only respond to certain advertising mechanisms. In addition, companies can score points in the US with samples and vouchers.Klaus Knappik, Chairman of the MAIL International Divisional Board, Deutsche Post World Net
Dr. Diane Rinas, Senior Marketing Manager, Deutsche Post World Net
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