Expect Less Junk in the Mail As Marketers Continue Cutbacks

By Anita Huslin
Washington Post Staff Writer
Saturday, November 8, 2008

Marketers are generally a persistent lot, but they're beginning to think that bombarding your mailbox might not be worth it.

At the rate things are going, credit card companies will send a billion fewer unsolicited offers to consumers by the end of the year, dropping from 5.2 billion offers last year, according to data released yesterday by Synovate Mail Monitor, a market research firm. Home-equity credit mailings dropped 66 percent in the third quarter this year to 72.9 million, compared with 215 million in the same period last year, according to market research firm Mintel Comperemedia. Mortgage mailings dropped 44 percent to 182.4 million from 324.1 million in same period last year.

Among large institutions, Citibank and Charles Schwab cut back the most, reducing 98 and 95 percent, respectively, of their consumer-banking solicitations in the third quarter of this year compared with the second, according to Mintel. Bank of America mailed 49 percent fewer credit card offers and HSBC, one of the first banks to announce big subprime write-offs in the housing crisis, sent 44 percent less. Representatives of the four companies had no comment.

"People who have good credit don't need another credit card," said Barry Kassel, chief executive of RTC Relationship Marketing in Georgetown. "And other people are overextended. It's an over-commoditized category in which anybody who passes a credit screening pretty much has too much credit card in their wallet already."

Catalogue companies, already pinched by a postal rate increase last year, began scaling back earlier this year. Late last month, the Postal Service projected that it would carry 9 billion fewer pieces of all types of mail in fiscal 2008 than it did the year before.

"All of the catalogers I'm talking to are working to reduce their dependence on mail," said Hamilton Davison, executive director of the American Catalog Mailers Association, which estimates that companies spend $5.6 billion on postage annually. "The industry is feverishly trying to figure out a way to find viable [customers] in other ways and when it does there'll be an enormous migration away from mail."

Look at intimate apparel, but never buy? That slinky lingerie catalogue may stop showing up. High-end houseware companies, feeling the ripple effects of the housing downturn, are cutting back, too. Earlier this year, after reporting a 42 percent revenue loss, Williams-Sonoma said it would trim its mailing list. Neiman Marcus, renowned for its holiday wish book with trinkets such as the $20 million personal submarine or $12 million Bombardier Learjet, is cutting back.

"We have reduced the number of catalogues by double digits over our original budget, reduced the paper weight, looked at alternative, more efficient formats, taken pages down per book," said Stan Krangel, president of catalogue retailer Miles Kimball, which has multiple brands including Exposures and Walter Drake. "Many of these options hurt response from the consumer, but we have to reduce our costs and are constantly seeking efficiencies. We are looking at the same trend for next year."

Earlier this year, a survey by the Direct Marketing Association showed a 55 percent drop in the number of companies that said a paper catalogue was their primary market channel for business.

For average American households, Mintel analysts estimate, the trend points to more room in their mailboxes. Last quarter, for example, 8.3 fewer pieces of credit card junk mail showed up compared with the same period in 2005.

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