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Part Five Developing the Integrated Marketing Communications Program
Belch: Advertising and
Promotion, Sixth Edition
Exhibit 14-6 VNU
provides lists for purchase
V. Developing the
Integrated Marketing
Communications Program
14. Direct Marketing © The McGraw−Hill
Companies, 2003
has led to increased effectiveness. The most commonly used lists are of individuals
who have already purchased direct-mail products.
The importance of the list has led to a business of its own. It has been estimated that
there are over 38 billion names on lists, and many companies have found it profitable
to sell the names of purchasers of their products and/or services to list firms. Companies
like A. B. Zeller and VNU Business Media (Exhibit 14-6) provide such lists on a
national level, and in most metropolitan areas there are firms providing the same service
locally.
While direct mail continues to be a favorite medium of many advertisers, and projections
are that the market will continue to grow, this medium has been seriously threatened
by the Internet. Between 1996 and 2001 direct-mail expenditures rose at the rate of
6.15 percent per year while Internet expenditures increased at the rate of 95 percent. 18
Interestingly, the Internet is both a threat and an opportunity, as Internet companies have
increased their expenditures in direct mail to drive potential customers to their sites. For
example, AOL frequently mails disks with free time to induce trial of its Internet service.
Nevertheless, the direct-mail business has experienced lower response rates from
customers than in the past and has seen many advertisers shift dollars from this medium
to the Net. 19 Many companies, particularly in the business-to-business market, have
shifted from print to online catalogs, and legal problems have also hurt the industry.
Catalogs Major participants in the direct-marketing business include catalog
companies. The number of catalogs mailed and the number of catalog shoppers have
increased significantly since 1984, with sales growing by an average of 11.4 percent
each year between 1996 and 2001. Catalog sales are expected to reach $16.3 billion in
2006. 20
Many companies use catalogs in conjunction with their more traditional sales and
promotional strategies. For example, companies like Pottery Barn, Nordstrom, and
JCPenney sell directly through catalogs but also use them to inform consumers of
product offerings available in the stores. Some companies (for example, Fingerhut and
Alloy) rely solely on catalog sales. Others that started out exclusively as catalog com-