DIRECT MAIL COMPANIES TO GO GREEN ?

[TrueBlueTerrier]

http://www.mycustomer.com/cgi-bin/item.cgi?id=133566

Direct marketing material is estimated to account for approximately 550,000 tonnes of the household waste. Iain Lovatt argues that the issue of waste control in the direct marketing industry needs to be tackled on a number of sides if it is to avoid the Government mandating opt-in marketing regulations.

Recycling direct mail

By Iain Lovatt, Blue Sheep Ltd

The environment is the biggest social and political topic of the decade with global warming and its consequences heading the long list of shared concerns about the planet’s future. This focus has raised the general public’s awareness of the cost of their actions. There has been a call to arms to encourage as much recycling as possible, with local authorities offering a disparate range of services and initiatives.

It has also been avidly adopted by political leaders who have grasped the issues like a lifeline in order to gain centre position in the debate. As a result, business activities are under scrutiny with visible waste bearing the brunt of criticism and the focus of corrective schemes. The global business community does have a collective responsibility to consider its impact on the planet and those involved in the direct marketing industry - from creation to door-step delivery -must respond accordingly to gain public acceptance. The question: is who grasps the nettle?

The direct mail industry is broad and many businesses benefit from its activities, however, it is the frontline businesses that are associated with waste.

As the debate rages at the Direct Marketing Association (DMA) about what can be done to achieve an increase in paper recycling from 33% to 55% by the end of 2009, five billion direct mail items continue to hit the public’s door mat each year. The perpetrators of this onslaught, as perceived by some Government officials, are well known and include Lloyds TSB, Capital One, MBNA, SAGA, BSkyB, the Halifax, Norwich Union, BT, LV= and, not least, Barclaycard.

These organisations represent the top ten ‘offenders’, (users of direct mail marketing) - they also represent a considerable revenue stream for the Royal Mail and the source for many jobs and essential services. Surprisingly, they do not represent the bulk of direct mail waste. This is attributed to non-addressed information of all forms from leaflet inserts to unaddressed letters.

The direct mail industry is broad and many businesses benefit from its activities, however, it is the frontline businesses that are associated with waste - not the companies which facilitate the service. Behind this we have the Royal Mail and other door to door companies who profit significantly. Few would point to the Royal Mail and others as having any responsibility for the industry’s current predicament or its performance.

An industry on the precipice

According to figures from Defra, direct marketing material accounts for approximately 550,000 tonnes of the household waste. Of this, 181,500 tonnes are estimated to be addressed direct mail with the remaining 368,500 tonnes being unaddressed direct marketing material. Clearly, publishers and door-drop contractors are playing a significant role in contributing to waste production, yet in some respects a leaflet falling from a magazine has a lower emotional impact than a personalised letter and may not be classified by the recipient as ‘direct mail’. Waste management must therefore, take into account a broader range of operators.

The escalation of waste has given the Labour Government the ammunition to explore whether an opt-in system would be an appropriate mechanism for the industry. If this were to gain acceptance, it would signal the end of direct marketing.

In 2003, the DMA signed an agreement which resulted in a 5% reduction in the amount of addressed direct mail. This was partly achieved through the promotion of the mailing preference service (MPS). However, unaddressed mail (including inserts in magazines and newspapers) has shown an increase of 1–2% per year. To reduce this growth the DMA has agreed to look into a similar opt-out scheme to the MPS operating on a voluntary basis to improve targeting. At the distribution stage, the Royal Mail currently operates an opt-out scheme called ‘Door-to-Door Opt-Out Service’ which allows the public to prevent unaddressed information being delivered.

Little has been done to date to measure DM’s true impact on the environment and how its activities compare with other marketing approaches. However, there have been calls for an independent environmental impact assessment to be undertaken for all direct marketing channels from TV ads, email communications, telephone calls, etc. This way the industry may be able to defend its activities and help to change the public’s perception.

Certainly, the escalation of waste has given the Labour Government the ammunition to explore whether an opt-in system would be an appropriate mechanism for the industry. And if this were to gain acceptance, it would signal the end of direct marketing.

Addressing waste head-on

The topical issue of waste control in the direct marketing industry needs to be tackled on a number of sides. On the one hand we have the representative bodies such as the DMA whose role is to mediate government control with industry practice and on the other, major users and distributors of direct mail. They are inextricably linked and interdependent yet a collective view on how to protect and preserve the industry has not been forthcoming.

Obtaining a 1-3% response rate from as mailing campaign is considered an acceptable result. Consequently, a high percentage of letters are discarded.

Direct mail has always suffered from a high percentage of waste. Obtaining a 1-3% response rate from as mailing campaign is considered an acceptable result. Consequently, a high percentage of letters are discarded. Even if targeting improves dramatically, there will always be waste – it is the nature of the beast. So, the solution to creating an acceptable new face for DM lies in the way paper waste can be managed in an environmentally friendly way.

Over the past five years, the DMA has raised awareness in the industry for greater environmental responsibility promoted through initiatives with leading environmental charities such as the Woodlands Trust, Planet Ark and WRAP. It has outlined the need for more accurate targeting, the broader use of suppression files and the differentiation of direct and ‘junk’ mail.

However, the big ten have been slow to react to the spectre of legislation by making an attempt to encourage recipients of unwanted mail to recycle. Concerns of identity theft are leading people to shred and dump and ultimately, dispose in landfill. The answer to this problem may reside in licensing schemes and levies but who should pay?

Levy or license

The idea of putting a charge or levy on mail is not new. Whilst the industry continues to make profits and is not adversely affected by preference service activity, pressure to change or to embark on a radical rethink is unlikely. The current situation will not remain static, however, and external pressures will force change if the industry is not seen to evolve. One such radical idea is the adoption of a postal levy. This would impose a fee on the delivery of a letter.

If visible efforts are made by the major users of direct mail to encourage recycling it can only have a positive effect on the industry and its future.

With over 15 billion letters processed by the Royal Mail each year, a 1p levy would raise in the region of £150 million. Money raised from levies could be used to set up ‘not for profit’ recycling schemes and initiatives to salvage discarded letters. Unwanted post labelled ‘return to sender for recycling’ would be taken back by the allotted organisation and delivered to local, secure recycling centres. These would be open to the public and under the control of, or operated through, a contracted business.

This concept could be expanded to tackle unaddressed mail. Publishers and distributors would also introduce a voluntary charge to cover the cost of recycling. Licensing of direct mail operators apportioning a charge according to the volume of direct mail used is also worthy of consideration.

Simple ideas make a major difference such as putting WRAP recycle notices on mailers, using appropriate materials and being sensitive to addressing schemes. Local council policies on what materials can be recycled also need to be considered and standardised. If visible efforts are made by the major users of direct mail to encourage recycling it can only have a positive effect on the industry and its future.

Iain Lovatt is executive chairman of Blue Sheep.

[Darren Bent]

Good as there is too much crap, and hopefully all junk mail is printed on recycled paper already.

[jemima]

Why not re-use it rather than recycle it? Deliver one leaflet to one house in every street with the request to "please pass it on" to their neighbours after they've finished reading it....

Someone has started giving some of their junk mail back to RM, they've been putting it into a letter box I collect from. Does anyone else get that problem? I've been wondering though, if we had special collections for waste paper (from offices etc., not just the junk mail), would there be money to be made from recycling it? RM Recycling Ltd....