GDPR affects spending

GDPR causes big dip in direct mail spending – but results are stronger than ever.

Apr 4, 2019 | Marc Middleton-Heath

The latest data has shown a sharp decline in the level of spending on direct mail, but here at Catalyst it’s still performing well.

Industry trends

Industry expert Tim Bond, head of insight at the DMA, has said uncertainty about GDPR compliance led to a “significant dip in activity” in direct mail spend last year, but he expects it to level over time. “Direct mail is still an incredibly powerful tool,” he said.

Certainly, the increase in spending on door drops backs up the theory that GDPR is behind the sudden change. Door drops aren’t addressed to individuals so they aren’t subject to the same GDPR requirements as direct mail.

The figures

According to data from the market research company Nielsen, the amount charities spent on direct mail fell from £190.1m (year to the end of February 2018) to £128.7m (a year later). During the same period, total advertising spend by charities went down from £387.9m to £356.9m, thanks largely to the drop off in direct mail.

Of the seven areas surveyed, direct mail and press were the only ones to experience year-on-year falls in spending. TV advertising grew from £124.4m to £145.6m, overtaking direct mail. Spending on outdoor advertising also went up considerably, from £8.5m to £14m. And no figures for online advertising were provided.

Meanwhile, direct mail results are really good

It’s easy to understand why organisations have been nervous about GDPR, but data management is actually tighter and many lists are responsibly created. For our clients, who are using bought lists, results are really good. We suspect it’s party because many charities have moved out of the direct mail space, so there is less ‘competition’.  Direct mail campaigns have certainly performed well for our clients throughout, and DM promises to remain a winner long into the future.

Read the Third Sector article in full.

Marc Middleton-Heath
Managing Director, Catalyst.
4th April 2019

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