Direct-mail marketing involves sending an offer, announcement, reminder, or other item to a person at a particular address. Using highly selective mailing lists, direct marketers send out millions of mail pieces each year—letters, catalogs, ads, brochures, samples, videos, and other “salespeople with wings.” U.S. marketers spend an estimated $47 billion annually on direct mail (including both catalog and noncatalog mail), which accounts for 30 percent of all direct marketing spending.37

Direct mail is well suited to direct, one-to-one communication. It permits high target-market selectivity, can be personalized, is flexible, and allows the easy measurement of results. Although direct mail costs more per thousand people reached than mass media such as television or magazines, the people it reaches are much better prospects. Direct mail has proved successful in promoting all kinds of products, from books, insurance, travel, gift items, gourmet foods, clothing, and other consumer goods to industrial products of all kinds. Charities also use direct mail heavily to raise billions of dollars each year.

Some analysts predict a decline in the use of traditional forms of direct mail in the coming years as marketers switch to newer digital forms, such as email and online, social media, and mobile marketing. The newer digital direct marketing approaches deliver messages at incredible speeds and lower costs compared to the U.S. Post Office’s “snail mail” pace.

However, even though new digital forms of direct marketing are bursting onto the scene, traditional direct mail is still heavily used by most marketers. Mail marketing offers some distinct advantages over digital forms. It provides something tangible for people to hold and keep, and it can be used to send samples. “Mail makes it real,” says one analyst. It “creates an emotional connection with customers that digital cannot. They hold it, view it, and engage with it in a manner entirely different from their [digital] experiences.” According to the U.S. Postal Service, 98 percent of people check their physical mailboxes every day. In contrast, email and other digital forms are easily ignored, filtered, or trashed. With spam filters and ad blockers filtering out email and mobile ads these days, says a direct marketer, “sometimes you have to lick a few stamps.”38

Traditional direct mail can be an effective component of a broader integrated marketing campaign. For example, GEICO relies heavily on TV advertising to establish broad customer awareness and positioning. However, it also uses lots of good old direct mail to break through the glut of insurance advertising clutter on TV. GEICO uses direct mail offers that invite carefully targeted customers act immediately to save money on their auto insurance by visiting geico.com, calling 1-800-947-AUTO, or contacting a local GEICO agent. GEICO makes its direct mailers as unskippable as its TV and digital ads. For example, potential customers might receive a personally addressed mail piece with a “save money” message and scannable code on the front of the envelope, inviting them to look inside or simply scan the code with their smartphone. Scanning the code takes them directly to GEICO’s mobile site where they received additional information and calls to action.

Direct mail may be resented as junk mail if sent to people who have no interest in it. For this reason, smart marketers are targeting their direct mail carefully so as not to waste their money and recipients’ time. They are designing permission-based programs that send direct mail only to those who want to receive it.

Advances in technology, along with the move toward personalized, one-to-one marketing, have resulted in exciting changes in catalog marketing. Catalog Age magazine used to define a catalog as “a printed, bound piece of at least eight pages, selling multiple products, and offering a direct ordering mechanism.” Today, the definition must be revamped to meet the changing times.

With the stampede to the internet and digital marketing, more and more catalogs are going digital. A variety of online-only catalogers have emerged, and most print catalogers have added web-based catalogs and mobile catalog shopping apps to their marketing mixes. For example, catalogs from retailers such as Macy’s, Anthropologie, L.L. Bean, Hammacher Schlemmer, or West Elm are only a swipe of the finger away on a smartphone or tablet. And days before the latest Eddie Bauer catalog arrives in the mail, customers can access it digitally on a laptop or mobile device at eddiebauer.com or catch highlights via social media outlets such as Pinterest. Eddie Bauer’s mobile catalog gives customers the convenience of on-the-go browsing and purchasing.

Digital catalogs eliminate printing and mailing costs. They also allow real-time merchandising: Products and features can be added or removed as needed and prices can be adjusted instantly to match demand. And whereas space is limited in a print catalog, online catalogs can offer an almost unlimited amount of merchandise. Customers can carry digital catalogs anywhere they go, even when shopping at physical stores. Online catalogs also offer a broader assortment of presentation formats, including search and video. Finally, digital catalogs can be interactive. For example, IKEA’s catalog app allows customers to experiment with room designs and colors schemes to see how an IKEA product might look in their own space and to share product and design ideas with others via social media.

Despite the advantages of digital catalogs, however, as your overstuffed mailbox may suggest, printed catalogs are still thriving. U.S. direct marketers mailed out some 12 billion catalogs last year—more than 97 per American household.39 Why aren’t companies ditching their old-fashioned paper catalogs in this new digital era? For one thing, printed catalogs are one of the best ways to drive online and mobile sales, making them more important than ever in digital time. For example, one survey found that 75 percent of Lands’ End shoppers say they look at a catalog before heading to the retailer’s online or mobile site to buy. And menswear company Bonobos discovered that 30 percent of its first-time online customers are inspired to shop there after receiving a catalog, and these buyers spend 50 percent more than catalog-free Bonobos shoppers.40

But beyond their ability to drive immediate sales, paper catalogs create emotional connections with customers. Somehow, turning actual catalog pages engages consumers in a way that digital images simply can’t. And many sellers are revamping their catalogs, making them much more than just big books full of product pictures and prices. For example, Anthropologie calls its catalogs “journals” and fills them with lifestyle images. “Of course we’re trying to sell clothes and accessories,” says Anthropologie’s CMO, “but it’s more to inspire and engage.”

Similarly, in addition to the 10 or so traditional catalogs that it publishes each year, Patagonia sends out other catalogs built around themes. One recent catalog featured falconry, with images of children with condors in Chile and wildlife volunteers in California releasing rehabilitated red-tailed hawks.

The catalog included only a handful of products, placed on the last four pages of the 43-page book. Such catalogs are “a way we’re speaking to our closest friends and people who know the brand really well,” says a Patagonia marketer. “Years ago, [a catalog] was a selling tool, and now it’s become an inspirational source,” says another direct marketer. “We know our customers love a tactile experience.”41

Telemarketing involves using the telephone to sell directly to consumers and business customers. U.S. marketers will spend an estimated $44 billion on telemarketing this year, almost as much as on direct mail.42 We’re all familiar with telephone marketing directed toward consumers, but business-to-business (B-to-B) marketers also use telemarketing extensively. Marketers use outbound telephone marketing to sell directly to consumers and businesses. They also use inbound toll-free numbers to receive orders from television and print ads, direct mail, or catalogs.

Properly designed and targeted telemarketing provides many benefits, including purchasing convenience and increased product and service information. However, the explosion in unsolicited outbound telephone marketing over the years annoyed many consumers, who objected to the almost daily “junk phone calls.” In 2003, U.S. lawmakers responded with the National Do Not Call Registry, which is managed by the Federal Trade Commission (FTC). The legislation bans most telemarketing calls to registered phone numbers (although people can still receive calls from nonprofit groups, politicians, and companies with which they have recently done business). Consumers responded enthusiastically. To date, more than 222 million home and mobile phone numbers have been registered at www.donotcall.gov or by calling 888-382-1222.43 Businesses that break do-not-call laws can be fined up to $16,482 per violation. As a result, the program has been very successful.

Do-not-call legislation has hurt parts of the consumer telemarketing industry. However, two major forms of telemarketing—inbound consumer telemarketing and outbound B-to-B telemarketing—remain strong and growing. Telemarketing also remains a major fundraising tool for nonprofit and political groups. Interestingly, do-not-call regulations appear to be helping some direct marketers more than they’re hurting them. Rather than making unwanted calls, many of these marketers are developing “opt-in” calling systems, in which they provide useful information and offers to customers who have invited the company to contact them by phone or email. The opt-in model provides better returns for marketers than the formerly invasive one.

Direct-response television (DRTV) marketing takes one of two major forms: direct-response television advertising and interactive TV (iTV) advertising. Using direct-response television advertising, direct marketers air television spots, often 60 or 120 seconds in length, which persuasively describe a product and give customers a toll-free number or an online site for ordering. It also includes full 30-minute or longer advertising programs, called infomercials, for a single product.

Successful direct-response television advertising campaigns can ring up big sales. For example, little-known infomercial maker Guthy-Renker has helped propel its Proactiv Solution acne treatment and other “transformational” products into power brands that pull in $1.8 billion in sales annually to 5 million active customers (compare that to only about $150 million in annual drugstore sales of acne products in the United States). Guthy-Renker now combines DRTV with social media campaigns using Facebook, Pinterest, Google+, Twitter, and YouTube to create a powerful integrated direct marketing channel that builds consumer involvement and buying.44

DRTV ads are often associated with somewhat loud or questionable pitches for cleaners, stain removers, kitchen gadgets, and nifty ways to stay in shape without working very hard at it. For example, over the past few years yell-and-sell TV pitchmen like Anthony Sullivan (Swivel Sweeper, Awesome Auger) and Vince Offer (ShamWow, SlapChop) have racked up billions of dollars in sales of “As Seen on TV” products. Brands like OxiClean, ShamWow, and the Snuggie (a blanket with sleeves) have become DRTV cult classics. And direct marketer Beachbody brings in more than $570 million annually via an army of workout videos—from P90X and T-25 to Insanity and Hip Hop Abs—that it advertises on TV using before-and-after stories, clips of the workout, and words of encouragement from the creators.45

In recent years, however, a number of large companies—from P&G, Disney, Revlon, and Apple to Toyota, Coca-Cola, Sears, Home Depot, and even the U.S. Navy—have begun using infomercials to sell their wares, refer customers to retailers, recruit members, or attract buyers to their online, mobile, and social media sites.

A more recent form of direct-response television marketing is interactive TV (iTV), which lets viewers interact with television programming and advertising. Thanks to technologies such as interactive cable systems, internet-ready smart TVs, and smartphones and tablets, consumers can now use their TV remotes, phones, or other devices to obtain more information or make purchases directly from TV ads. For example, fashion retailer H&M recently ran ads that let viewers with certain Samsung smart TVs use their remotes to interact directly with the commercials. A small pop-up menu, shown as the ads ran, offered product information, the ability to send that information to another device, and the option to buy directly.46

Also, increasingly, as the lines continue to blur between TV and other screens, interactive ads and infomercials are appearing not just on TV, but also on mobile, online, and social media platforms, adding even more TV-like interactive direct marketing venues. Also, most TV ads these days routinely feature web, mobile, and social media links that let multiscreen consumers connect in real time to obtain and share more information about advertised brands.

As consumers become more and more comfortable with digital and touchscreen technologies, many companies are placing information and ordering machines—called kiosks (good old-fashioned vending machines but so much more)—in stores, airports, hotels, college campuses, and other locations. Kiosks are everywhere these days, from self-service hotel and airline check-in devices, to unmanned product and information kiosks in malls, to in-store ordering devices that let you order merchandise not carried in the store. Many modern “smart kiosks” are now wireless-enabled. And some machines can even use facial recognition software that lets them guess gender and age and make product recommendations based on those data.

In-store Kodak, Fuji, and HP kiosks let customers transfer pictures from memory cards, mobile phones, and other digital storage devices; edit them; and make high-quality color prints. Seattle’s Best kiosks in grocery, drug, and mass merchandise stores grind and brew fresh coffee beans and serve coffee, mochas, and lattes to on-the-go customers around the clock. Redbox operates more than 42,000 DVD rental kiosks in McDonald’s, Walmart, Walgreens, CVS, Family Dollar, and other retail outlets—customers make their selections on a touchscreen, then swipe a credit or debit card to rent DVDs for less than $2 a day.

ZoomSystems creates small, freestanding kiosks called ZoomShops for retailers ranging from Apple, Sephora, and The Body Shop to Macy’s and Best Buy. For example, 100 Best Buy Express ZoomShop kiosks across the ­country—conveniently located in airports, busy malls, military bases, retail stores, and resorts—automatically dispense an assortment of portable media players, digital cameras, gaming consoles, headphones, phone chargers, travel gadgets, and other popular products. According to ZoomSystems, today’s automated retailing ­“offers [consumers] the convenience of online shopping with the immediate gratification of ­traditional retail.”47

Direct marketers and their customers usually enjoy mutually rewarding relationships. Occasionally, however, a darker side emerges. The aggressive and sometimes shady tactics of a few direct marketers can bother or harm consumers, giving the entire industry a black eye. Abuses range from simple excesses that irritate consumers to instances of unfair practices or even outright deception and fraud. The direct marketing industry has also faced growing privacy concerns, and online marketers must deal with internet and mobile security issues.

Irritation, Unfairness, Deception, and Fraud

Direct marketing excesses sometimes annoy or offend consumers. For example, most of us dislike direct-response TV commercials that are too loud, long, and insistent. Our mailboxes fill up with unwanted junk mail, our email inboxes bulge with unwanted spam, and our computer, phone, and tablet screens flash with unwanted online or mobile display ads, pop-ups, or pop-unders.

Beyond irritating consumers, some direct marketers have been ­accused of taking unfair advantage of impulsive or less-sophisticated buyers. Television shopping channels, enticing websites, and program-long infomercials targeting television-addicted shoppers seem to be the worst culprits. They feature smooth-talking hosts, elaborately staged demonstrations, claims of drastic price reductions, “while they last” time limitations, and unequaled ease of purchase to inflame buyers who have low sales resistance.

Fraudulent schemes, such as investment scams or phony collections for charity, have also multiplied in recent years. Internet fraud, including identity theft and financial scams, has become a serious problem. According to the Internet Crime Complaint Center, since 2005, internet scam complaints have more than tripled to almost 275,000 per year. Last year, the monetary loss of scam complaints exceeded $800 million.48

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One common form of internet fraud is phishing, a type of identity theft that uses deceptive emails and fraudulent online sites to fool users into divulging their personal data. For example, consumers may receive an email, supposedly from their bank or credit card company, saying that their account’s security has been compromised. The sender asks them to log on to a provided web address and confirm their account number, password, and perhaps even their Social Security number. If they follow the instructions, users are actually turning this sensitive information over to scam artists. Although many consumers are now aware of such schemes, phishing can be extremely costly to those caught in the net. It also damages the brand identities of legitimate online marketers who have worked to build user confidence in web, email, and other digital transactions.

Many consumers also worry about online and digital security. They fear that unscrupulous snoopers will eavesdrop on their online transactions and social media postings, picking up personal information or intercepting credit and debit card numbers. Although online shopping is now commonplace, one recent study indicated that 70 percent of participants were still concerned about identity theft. Such concerns are often justified in this age of mass consumer data breaches by organizations ranging from retailers, telecommunications services, and banks to health-care providers and the government. According to one source, there were 781 major data security breaches in the United States last year alone.49

Another internet marketing concern is that of access by vulnerable or unauthorized groups. For example, marketers of adult-oriented materials and sites have found it difficult to restrict access by minors. Although Facebook, Snapchat, Twitter, Instagram, and other social networks allow no children under age 13 to have profiles, all have significant numbers of underage users. Young social media users can be especially vulnerable to identity theft schemes, revealing personal information, negative experiences, and other online dangers. Concerned state and national lawmakers are currently debating bills that would help better protect children online. Unfortunately, this requires the development of technology solutions, and as Facebook puts it, “That’s not so easy.”50

A Need for Action

To curb direct marketing excesses, various government agencies are investigating not only do-not-call lists but also do-not-mail lists, do-not-track-online lists, and Can Spam legislation. In response to online privacy and security concerns, the federal government has considered numerous legislative actions to regulate how online, social media, and mobile operators obtain and use consumer information. For example, Congress is drafting legislation that would give consumers more control over how online information is used. In addition, the FTC is taking a more active role in policing online privacy.

All of these concerns call for strong actions by marketers to monitor and prevent privacy abuses before legislators step in to do it for them. For example, to head off increased government regulation, six advertiser groups—the American Association of Advertising Agencies, the American Advertising Federation, the Association of National Advertisers, the Direct Marketing Association, the Interactive Advertising Bureau, and the Network Advertising Initiative—issued a set of online advertising principles through the Digital Advertising Alliance. Among other measures, the self-regulatory principles call for online and mobile marketers to provide transparency and choice to consumers if online viewing data are collected or used for targeting interest-based advertising. The ad industry uses an advertising option icon—a little “i” inside a triangle—that it adds to behaviorally targeted online ads to tell consumers why they are seeing a particular ad and allowing them to opt out.54

Of special concern are the privacy rights of children. In 2000, Congress passed the Children’s Online Privacy Protection Act (COPPA), which requires online operators targeting children to post privacy policies on their sites. They must also notify parents about any information they’re gathering and obtain parental consent before collecting personal information from children under age 13. With the subsequent advent of online social media, mobile phones, and other digital technologies, Congress in 2013 extended COPPA to include “identifiers such as cookies that track a child’s activity online, as well as geolocation information, photos, videos, and audio recordings.” The main concern is the amount of data mined by third parties from social media as well as social media’s own hazy privacy policies.55

Many companies have responded to consumer privacy and security concerns with actions of their own. Still others are taking an industry-wide approach. For example, TRUSTe, a nonprofit self-regulatory organization, works with many large corporate sponsors, including Microsoft, Yahoo!, AT&T, Facebook, Disney, and Apple, to audit privacy and security measures and help consumers navigate the internet safely. According to the company’s website, “TRUSTe believes that an environment of mutual trust and openness will help make and keep the internet a free, comfortable, and richly diverse community for everyone.” To reassure consumers, the company lends its TRUSTe privacy seal to websites, mobile apps, email marketing, and other online and social media channels that meet its privacy and security standards.56

The direct marketing industry as a whole is also addressing public policy issues. For example, in an effort to build consumer confidence in shopping direct, the Direct Marketing Association—the largest association for businesses practicing direct, database, and interactive marketing, including nearly half of the Fortune 100 companies—launched a “Privacy Promise to American Consumers.” The Privacy Promise requires that all DMA members adhere to a carefully developed set of consumer privacy rules. Members must agree to notify customers when any personal information is rented, sold, or exchanged with others. They must also honor consumer requests to opt out of receiving further solicitations or having their contact information transferred to other marketers. Finally, they must abide by the DMA’s Preference Service by removing the names of consumers who do not wish to receive mail, phone, or email offers.57

Direct marketers know that, if left untended, such direct marketing abuses will lead to increasingly negative consumer attitudes, lower response and engagement rates, and calls for more restrictive state and federal legislation. Most direct marketers want the same things that consumers want: honest and well-designed marketing offers targeted only toward consumers who will appreciate and respond to them. Direct marketing is just too expensive to waste on consumers who don’t want it.