Direct mail industry is changing sales tactics

Next time you complain about unsolicited direct mail arriving through your letterbox, spare a thought for the residents of Chicago who receive an average of 650 pieces each year. This degree of junk persecution is unknown in the Republic, where the average person receives a mere 26 pieces of addressed direct mail per year.

A large proportion of that mail comes from companies or institutions, which already have a relationship with the individual.

That rate will rise but the direct marketing industry promises that people increasingly will receive mail that theoretically ties in with their interests.

Mr Bill Moss is a Dublin-based list broker who represents companies which have commercially available lists. "We are never going to have thousands of mailing lists in Ireland because the population is too small to sustain specialised categories," Mr Moss said.

Because the Irish direct marketing industry developed after the introduction of the Data Protection Act, there have been controls on the compiling and use of databases all along.

Advances in technology now mean that databases are more refined and increased targeting is possible.

But how are these lists compiled in the first place?

Precision Marketing Information is a joint venture between An Post and the US information firm Equifax and has a database of 300,000 consumers.

The database contains lifestyle information about people and is created from an annual questionnaire.

Last year, the company mailed its questionnaire to one million households and got an 8 per cent response rate. A response rate of between 3 to 4 per cent of customers gained is considered acceptable in direct mail terms.

If a business is then looking for customers with an interest in red wine, golf and pensions and investments, the company can narrow its database down and provide a targeted list. According to Mr John McAndrew, managing director of of the joint venture, this kind of fine-tuning produces good results.

"It's not in anyone's best interests for there to be wastage and the more focused the marketing is, the better for all concerned," he said.

Typically, an envelope or postage pack costs less than £1 and, with a response rate of 4 per cent, it has proved to be a cost-effective way of recruiting customers.

Unsolicited phone-calls and e-mails are perceived as a problem but this is not really the case, according to Mr Michael Nolan, chief executive of the Irish Direct Marketing Association.

"Cold calling has not been successful here and there's only a couple of companies involved in it. As for blanket e-marketing or spamming, it hasn't taken off yet in Ireland," Mr Nolan said.

Members of the public can have their details removed from cold mailing lists by filling in a Mail Preference Service form at the post office. The service is provided by the association but does not cover e-mail.

For electronic junk mail, there is the option of downloading bulk mail screening software or, alternatively, keeping your details to yourself.

At this point in the Irish market, direct e-mails are targeted, usually to subscribers of electronic magazines who have given their permission. In some cases, chain mails of the "make-a-wish-and-send-this-on-to-10-friends" variety are used to build up databases of people (filed under gullible?).

From the marketing professionals' point of view, these direct mails are confused with the real thing and make people wary of opening anything from an unknown source. The challenge for the industry is to communicate with potential customers in a more innovative way.