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Can't deliver a good defense for junk mail

The co-owner of a direct marketing firm in Los Angeles says the ailing economy is putting jobs in the industry at risk. There still has got to be a better way.

April 08, 2009|DAVID LAZARUS

Marcy Clarke makes no apologies for being one of Southern California's leading junk mailers.

"I'm like most people," she told me. "The mail comes and I sit in front of the trash can and dump most of it. But every so often there's a gem in there that I'm interested in. That's the value of direct mail."

Clarke, 51, is co-owner of a South Los Angeles company called Service Mailers Inc. These days, she sends out about 12 million pieces of mail every month -- brochures, fliers, sales pitches, catalogs. Volume is down about 40% from a year ago.

I made Clarke's acquaintance after posting a video column online talking about how the recession had caused the amount of junk mail sent out last year to fall for the first time in nearly six decades. An even steeper decline is projected this year.

I characterized this in the video as the silver lining to all the dark clouds on the economic horizon.

"Hello, Mr. Uninformed," Clarke responded by e-mail. "You think having less 'junk mail' is good? How about the lost jobs in the direct-mail industry due to this economy? You think lost jobs are good? How about businesses closing due to less 'junk mail'? Is that good too?"

I asked Clarke if we could get together, and she was more than happy to oblige. We met the other day at her company's cavernous processing center on Exposition Place near the future tracks of the Expo Line light rail.

On one side of the building, a group of about a dozen women were hand-stuffing envelopes with brochures for a high-end clothing company. On the other side, a machine was stuffing envelopes with pitches for one of those sneaky "mortgage protection" firms that try to look like they're a government agency.

A huge stack of brochures for a cruise-ship line stood nearby awaiting processing. Boxes of other marketing materials were piled as high as the rafters for future jobs.

It was the junk mail heart of darkness.

Clarke turned out to be a very nice person, and we had something in common: The plight of her advertising-reliant business during one of the ugliest downturns in memory was almost identical to what most newspapers are going through.

"We employed about 80 people last year," she said as we walked past idle envelope-stuffing machines. "Now it's about 45."

Clarke's company pays most of its workers minimum wage. But she said it's one of the few junk mailers in the area to offer health benefits.

"Last week we had twice as much work," Clarke said. "This week we have people taking time off with no pay. We're doing what we have to to stay alive."

According to the Direct Marketing Assn., an industry group, junk mailers, telemarketers and their pitch-making ilk employ 1.6 million people nationwide and support 9.3 million other jobs, such as truck drivers and shippers.

Companies spent nearly $177 billion on direct marketing in the United States last year, accounting for more than half of all ad expenditures. Direct marketing generates more than $2 trillion in sales annually, the association estimates.

But a recent report from Winterberry Group, a market researcher, found that spending on junk mail fell about 3% last year as businesses, particularly banks, cut back on marketing. A further decline of as much as 9% is possible this year.

"Direct mail will still be around," Clarke said. "But it will get smaller, and it will have to get smarter."

That's another way of saying marketers will have to reach deeper into consumers' lives -- and privacy. If Clarke's right, more companies will invest in mailing lists and other personal data to help them get their sales pitches to the most likely buyers.

And there's plenty of information available. From the publications we receive to the groceries we purchase, it's all stored in databases for sale or rent to any marketer who wants it.

"Everyone who uses their Vons Club card or their Ralphs club card, they have no idea what they're doing," Clarke said. "They're letting marketers know exactly what they're buying."

As we roamed the processing center, I asked whether it doesn't get to her, the barrage of unsolicited offers she sends out daily, the mailings that try to dupe the unwary with official-looking forms or "you may have won" language.

"Sometimes I feel bad," she admitted. "But I have to work, don't I?"

Clarke then asked whether things would really be better if junk mailers closed shop and millions of workers lost their jobs.

"If we didn't have direct mail, think what would happen," she said while holding up a cruise ship brochure. "Our company would lose jobs and hundreds of people at the cruise ship company would probably also lose their jobs."

She had a point. But it seems to me that all these databases could also be used to allow those who want to receive marketing pitches to do so, and to allow everyone else to say, "No thanks."

As it stands, virtually any company you've ever done business with -- even just buying a cup of coffee -- is free to blitz you with as much nonsense as it pleases.

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