Published: March 19, 2008 in Knowledge@Wharton
Date Submitted: 3/19/2008 3:31:51 PM

Paper costs are rising, mail rate hikes are looming and competition from new media continues to grow. Yet marketers' use of direct mail and other printed materials is stronger than it's been in years. Thanks to variable-data printing, companies can now tap purchase- history databases to design, create and print entirely personalized catalogs that cross-sell products and services to individual consumers. They can also combine print with other media in the evolving discipline known as cross-channel marketing.

According to the U.S. Postal Service, approximately 103 billion items were mailed at the commercial rate last year, surpassing the nearly 96 billion letters sent first class. The Direct Marketing Association (DMA) projects print-based expenditures will rise slightly in the 10-year period ending in 2012, even as traditional mass media channels -- TV and radio, but especially newspapers and magazines -- continue to struggle.

'People Want to Feel Special'

Mocked as a "dead-tree medium" not long ago, print today defines as its core strength the flexibility once claimed by digital communications. Email, hailed in its infancy as a cost- effective panacea, has grown into an unruly adolescent with a spam-tarnished image that keeps many legitimate marketers away. Traditional broadcast and print media face eroding readerships and struggle to preserve their shrinking advertising base. And flavor-of-the- moment digital media, like blogging and instant messaging, are potentially paradigm- changing, but still untested.

According to Wharton marketing professor Eric Bradlow, print offers marketers a clear advantage over digital media, such as email. "Many people see email as impersonal and costless to write," he says. "People want to feel special. In marketing [terms], email is transactional; paper is relational."

Ed Manzitti, chief researcher at the DMA, suggests that paper is both relational and transactional. "Print is very much a potent channel for marketers," he says. "It has a flexibility that online doesn't offer to the same degree, and it has the possibility of tremendous personalization. But the biggest attraction may be simply that people read it -- to a degree they don't read email. The marketer can include four or five pages of words with the expectation it will get read. An email? You better make it short and punchy, because that's all you can expect will be read -- maybe."

It's clearly a change from the late 1990s when the direction of mass marketing seemed strictly digital. Indeed, commercial printing has gotten its momentum back in large part by doing what digital was supposed to do best -- creating and delivering the highly-individualized message. It has done this through variable-data printing -- also called one-to-one printing -- where marketers create, print and distribute mailers customized around individual profiles. Companies like Xerox have helped push this along.

Robert Pente, a strategic-marketing consultant based in Toronto, worked closely with Xerox last year to develop a cross-selling direct mail campaign for Reader's Digest Canada. Pente's job was to integrate the client's databases with its internal catalog-printing operation, allowing Reader's Digest to cross-sell by creating individualized catalogs. His team wrote a program that first tapped each customer's buying history, then created a personalized catalog that reflected presumed interest in other products and services. Each catalog was designed based on the customer's past purchasing history, affinities and demographic information.