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Direct Marketing Challenged by 2020’s Record Political Spend

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AccuList’s direct marketing clients need to plan for competition for consumer attention across all media as political campaigns’ ad spending is forecast to hit record heights in 2020. Kantar’s Campaign Media Analysis Group (CMAG) predicts that political media campaigns will spend a record $6 billion on advertising in 2020, a 14.3% increase over the $5.25 billion spent in the 2018 midterm elections, and a 37.9% increase over the last Presidential campaign year in 2016, with the biggest gains going to digital media, which will nearly double to $1.2 billion in 2020. Meanwhile, ad media giant GroupM forecasts that political ad spending could reach a record $9.8 billion or more in 2020, again driven by digital ad growth.

Political Digital Competition Will Squeeze Inventory, Drive Up CPM

Nonpolitical marketers will face a considerable challenge, especially if they are advertising in politically divided markets, warns Kantar. For example, in the last three weeks of the 2016 campaign season, political advertising totaled 32% of local TV ad time within the battleground markets studied, an increase of 26% from the beginning of the season, while nonpolitical advertisers watched their share of the market plummet from 77% to 51%. Meanwhile, because digital is a big growth area for politicos in 2020, with a preference for programmatic advertising, marketing agency Hiebing warns that a scramble for digital inventory will significantly drive up CPMs for nonpolitical campaigns. Advertisers should develop a game plan early, either shifting campaign flights out of the election window or diversifying channels and tactics, Hiebing advises. Marketers should also consider Private Marketplaces, or PMPs, which are invitation-only marketplaces where selected programmatic media buyers make deals with publishers. These can offer access to more premium inventory, and better control over brand safety, than open exchanges crowded by 2020 political buyers.

Direct Mail Needs Careful Scheduling, Targeting, Stand-out Tactics

For direct mailers, it’s important to recognize that mailbox crowding will be especially bad around certain key events, such as the weeks before an election date, as well as early voting starts and the delivery of absentee/mail ballots. Marketing-mail drop dates need to be adjusted accordingly. Since bulk mail delivery is slowed, taking a back seat to first-class political promotions, mailers need to build in extra delivery time to the in-home date. Plus, in 2020, you will need to pay attention to the Super Tuesday primaries on March 3 because those primaries will see more impact (and more political mail) than usual as two of the nation’s most populous states, Texas and California, are among the 14-state total; indeed, Super Tuesday this year affects a whopping one third of the U.S. population. Bottom line: Careful planning of mail schedules will be required to get promotions in the hands of target audiences at the right time! Even with good timing, mailboxes are busier and response can be impacted, so marketers also need to make an effort to stand out creatively, perhaps changing up outer envelopes in size and color, and to avoid costly waste with more targeted messaging, via segmentation and personalization.

Marketers Win by Catering to Millennial Direct Mail Fans

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Remember when marketing gurus were calling direct mail “dead,” drowned by a wave of digital, mobile, and social technologies? Well, research keeps resurrecting mail from its low-tech tomb. In fact, recent studies find that Millennials–the 22- to 36-year-old, tech-savvy generation supposedly addicted to mobile devices and digital networking–are bigger fans of direct mail than older generations in some ways!  That’s information that printers, mailing services, and a list broker and direct marketing consultant like AccuList USA can use to convince clients who hesitate over direct mail spending.

Millennials Like Direct Mail in General

For example, a recent study by InfoTrends and Prinova found that response rates for direct mail remain high for all demographics, including Millennials, who open direct mail received at the same high rate of 66% as recipients overall. More significantly, Milennials as a group respond faster to mail–within 2.4 months–which is less than the average response time for all respondents. Plus, the InfoTrends research found that a big 63% of Millennials who responded to a direct mail piece within that three-month period actually made a purchase! Along similar lines, the U.S. Postal Service (USPS) and the American Association of Political Consultants (AAPC) conducted a survey on direct mail’s political impact on Millennials and found that at least 42% of Millennials prefer direct mail political ads over online ads, that twice as many thoroughly read political mail, and that Millennials are more likely to be prompted to action by mail, with 66% likely to research the candidate and 54% visiting the candidate’s website after receiving mail.

But Millennials Also Prefer Specific Mail Tactics

However, research also shows that all mail pieces are not created equal. Mailings that resonate best with Millennials are targeted and personalized, per research. Luckily, sophisticated targeting and personalization are possible with today’s variable printing, programmatic and automation programs, and database segmentation and analytics. Millennials demand printing quality as well, with one quarter of surveyed 25- to 34-year-olds saying they opened direct mail because of the print and image quality. Mailers going beyond the standard No. 10 envelope–including 3-D dimensional mailers, pop-ups and intricately folded pieces–are playing to this audience that appreciates visual creativity. Plus, engaging copy counts, with 25% of that same surveyed group saying they consider reading direct mail a leisure activity. That doesn’t mean that printed mail can be divorced from Millennials’ digital lifestyle. Data in eMarketer’s survey report “US Millennial Shoppers 2017” shows that Millennials prefer digital shopping, even while in stores, and are comfortable with mobile shopping. The Millennial preference for digital/mobile shopping means that integrating print and digital–via QR, AR, or PURL–can significantly boost response, as shown in multiple studies. Research also shows that video is a response-getter for Millennials’ digital promotions. And now mailers have the printing technology to jump on the video bandwagon with audio players and video screens incorporated in direct mail.

For a good overview of recent data on direct mail and Millennials, see this article from The Financial Brand.