Editor's Note: Savings-driven Spending
We're always looking for shifts, especially the upward shift that everyone is praying the economy will undergo before too long. But the one entity that won't see that upward shift anytime soon is the U.S. Postal Service, which is experiencing a drop in advertising mail, correspondence mail and transactional mail.
Ad mail, in fact, has taken the biggest hit since 2006. In the USPS' Household Diary Study for 2008 released recently, ad mail dropped by 5.24 percent since 2006. Our own Who's Mailing What! Archive bears that out, as direct mail volume went down by 4.1 percent during that same period. Meanwhile, in the USPS study, correspondence mail declined by only half a percent and transactional mail by 2.34 percent since 2006. The reasons for the declines are well-known: email correspondence, online payments, digital advertising and budget crunches among mailers.
CNN.com took on the direct mail subject in its Aug. 18 article, "Less junk mail: Good for you, bad for the economy." It explained that emptier mailboxes are far from a good thing. "Before you start rejoicing, think about what this means for the economy. Less junk mail means fewer companies want to sell you their services—whether that's personalized checks or rug cleaning—which reflects wider problems in our economy."
Indeed, throughout the mailstream, nearly all sectors are hurting, from financial services to nonprofit (donors are more tight-fisted) to merchandise (more reluctant consumers) to publishing (undergoing its own internal recession). The exceptions are insurance and telecommunications companies, which are close to recession-proof.
But all this shouldn't be read as "bad news." It's simply reality. Credit-based spending was clearly out of control, and the expectation for continuous growth was unreasonable. Some key figures, such as Dr. Ramesh Lakshmi-Ratan, former COO of the Direct Marketing Association, actually expect direct mail to recover alongside the economy within the next few years.