Recently, advertising mail supplanted first class mail in total pieces delivered. Yet the USPS lost money last quarter – in fact the USPS has lost money in 12 out of the last 14 quarters. This year the USPS recommended cutting Saturday service as well as eliminating prepaid retiree health benefits.

We all know the reasons why – online bill paying being one of the big reasons first class mail volume has dropped so dramatically. To counter the ongoing trend downward the USPS has filed for a rate increase which will impact both first class and standard A (or advertising mail). Standard A or direct mail advertising continues to grow in revenue but some interesting changes are taking place as prices go up and mail volume overall declines. I can’t understand why squeezing the only area of the USPS that is growing seems like a good idea to the USPS.

Mail is becoming the channel for luxury and expensive brands. It’s nearly impossible to prospect through the mail for products and services that are inexpensive. The metrics simply do not work anymore. Magazine subscription offers used to flood the mail box but no more. The decline in magazine subscription mailings has a great deal to do with the decline of magazine circulation in general, but it has more to do with the fact that prospecting for new readers or renewals for existing readers is too expensive to be done through the mail.

It seems to me that less expensive products also have given up on mail as an acquisition channel. However the luxury marketers are using mail effectively as a channel to an increasing degree. Particularly once a prospect inquiry has been made for a luxury product, (whether it comes from a television, radio or magazine ad), that prospect is nurtured and analyzed, and then the prospect will be mailed to on a regular basis.

This tactic is very effective and works for several reasons.

1) Mailing to a self-selected lead/name is highly effective and very profitable for luxury or expensive products.

2) Consumer mailboxes have become more and more empty. Mail messages can penetrate the clutter much more so than in recent years.

3) People under thirty actually are not as tired of direct mail and the message penetrates much more than email which is fast becoming irrelevant to them – especially advertising email.

The tide has turned and direct mail is now on its way to being the bastion of luxury and expensive products and services. Maybe it’s there already.

What do you think?

I carry an Amex Platinum card for several reasons not the least of which is free access to several airline clubs (I wish there were more included but as you will read below the Delta Sky Lounge access is was a great thing for me this week). I also use the Platinum card for reservations in hard to get-in restaurants as they have a few tables every day and night in all the top places.

Amex Platinum also offers 2 for 1 business or first class tickets if purchased on the card – no other discount applies but still it can be a very good value. So it’s worth the high yearly fee since I get a lot of use out of it.

On Monday I was at LaGuardia and as I went through security the TSA agents asked to look through my bag. This was the second time in my last two flights. Last time they said it was random. This time they saw something which turned out to be a cigar lighter that I had forgotten was in the bag (and I have been looking all over my house for it – I just knew it would turn up). My Dad gave me that lighter and it has a lot of sentimental value to me as well as the fact that it works really well.

When something like this happens normally TSA takes it and it goes into the great abyss never to be seen again. This has happened with a cigar cutter I had (right after 9/11) in my luggage that was confiscated. (Apparently a then overzealous TSA agent felt I could pressure the pilot or flight attendant to put their finger through the cigar cutting hole and I would then threaten to cut it off – this policy has changed from what I am told).

So what to do? I remembered the Delta Sky Lounge was right next door so I asked the TSA agent to wait and quickly went into the Delta Sky Lounge to see if could get one of the attendants to come out to pick up the lighter and hold it for me until I returned. I walked in, explained my situation, the lovely attendant Marilyn was ready to help and walked right out, to pick up the lighter from the Agent Eric whom she said she knew. (We forget sometimes that the TSA agents are people with names, families and yes, personalities).

Marilyn came back in smiled and said she had it and would hold it for me and would be there when I returned since she was working that today. She was, I picked it up from her she escorted me out as per the TSA policy. This was a great example of a Delta Sky Club employee representing the brand as well as it can be done. I have had my issues with Delta Airlines http://wp.me/pJX7l-6a but they should be credited with having a class act like Marilyn as a part of their team.

Wish I had taken a photo of her – thanks Marilyn!

Over the weekend when I was flipping through the channels before heading out I saw the network baseball game and golf tournament. For some reason my thoughts drifted to fast food and realized that I had not seen an ad on television for McDonald’s, Burger King, or Wendy’s for a long time. Thinking more about it I don’t recall seeing them on page in magazines either or even hearing any of them on the radio. And by the way I watched a good amount of the Primetime Emmy’s last night and did not see one ad for any of them.

The last I recall hearing about any of them was the cheeky McDonald’s ad about the dollar that is hungry and what you can do with it. That might have been earlier this month so it’s likely that I just have not been listening to radio all that much lately.

I asked around to a couple of people if they were familiar with any ad campaigns for any of the big three burger leaders (actually McDonald’s is way far out in here so putting them in the same conversation would thrill Burger King and Wendy’s). Nobody I talked to could name any campaign.

Could the targeting be THAT good? Are the big three running ads in places of which I am not aware? I’m not one to eat in fast food restaurants any more than a handful of times a year. And I understand that I am far from the target audience in age or demographics. But I cannot remember any time where I had no idea of any of the campaigns run by the fast food outlets. Maybe they scale back campaigns in a big way in the summer time and are readying a deluge for the fall? With football season around the corner I could see that.

But what gives here? Am I missing the boat entirely? Are you aware of current ad campaigns run by McDonald’s, Burger King or Wendy’s? Oh and I don’t miss Jared at all thank you very much….

This season one of the story lines has Turtle helping his now girlfriend Alex promote her Uncle’s tequila brand made in Mexico called Tequila Avion www.tequilaavion.com . A good and interesting story line that branches out into nearly all the characters (not the Ari Gold character brilliantly played by Jeremy Piven, but I’d love to see Ari getting blotto on Avion).

What I did not realize until this week is that Tequila Avion is an actual product sold in stores. I saw a billboard promoting the brand and my jaw kind of dropped. A story in the New York Post this month http://bit.ly/bQ2tnb offered background on the founders of Avion and how they did not pay a penny for all the ‘priceless publicity’ for the new brand.

I had noticed that ‘Entourage’ does promote a number of brands at various times during the show. Johnnie Walker Blue, Belvedere Vodka, Skyy Vodka, (lots of alcohol), Bluetooth, Victoria’s Secret to name just a few all have been featured.

What makes it work so well is that the placements are seamlessly integrated into the story and they feel appropriate and right such that I really don’t notice that this is an obvious marketing tactic during the context of the show itself.

This is a trend that is growing and will continue to grow. Nobody likes a cheesy come-on but Tequila Avion is one of the first brands I can recall to be introduced within the context of a television program. I have no problem with it when it is done right as it is in the case of Tequila Avion

What do you think – is this a good trend? Bad trend? Does it offend you?

My management style is not a yelling one. Maybe a couple of times over the fourteen years I have raised my voice – not to team members. I remember one particular occasion as if it was yesterday but it actually was more than 11 years ago. A merchant with whom we were about to purchase a substantial amount of paper was asking about credit. We had run the business very successfully for several years and took discounts on all of our paper bills (you could look it up as the saying goes).

A then-young representative was giving me a bad time about issuing credit for several hundred thousand dollars worth of paper. At the time we had 5 employees 5 desks and 5 computers on those desks in a small office. After a back and forth discussion he offered ‘Hey, no offense but really you’re just a guy with a desk and a phone’.

I leapt at him through the phone line. I went ballistic. There was, shall we say some colorful language used and I’m not terribly proud to admit that. Over the ensuing years I’ve thought about why it bothered me so much. I took it as a huge insult. I still feel that way to a degree but wonder if what really was bothering me was that he was right! After all, what was I really but a guy with some ideas, some employees, and an approach to doing business that was successful (at least I thought it was).

I’m older now and with a little luck a bit wiser. And I would not react the same way today if I were to be in the same situation (we’ve been meeting with lenders lately so that’s what brought these thoughts to mind).

Today, our team is bigger, consequently the responsibilities to those people is even greater, as is the risk. Correspondingly our responsibilities to our clients are also bigger and wider. But at the root of it all nothing has changed. I am still a guy with a desk and a phone -and a computer, and a PDA and a laptop and a bunch of other things to aid in being more productive. We’re all about new and better ideas and procedures and that is our greatest asset – and I am truly proud of that more than anything else.

Epilogue – a couple of years later the same young representative called me to tell me that he was starting a paper brokerage with an associate. I tried to hold back but just could not do it. ‘Hey Charlie – I guess that means you’re just a guy with a desk and a phone’. Good moment for me.

Sometimes what goes around comes around.

Are you just a guy (or gal) with a desk and a phone?

This can be dangerous if you are having a spat with a friend and he or she ‘broadcasts’ that you are playing hooky or golf bar during the work day (when you were not there) and your boss finds out. The default settings allow this intrusion and you have to go into the application to change this in order to stop it from happening.

Meanwhile the folks at Foursquare whose location based service allows you to check in and send that update to Facebook are trying to figure out if FB is out to have their lunch. Since Foursquare has no revenue model, it would be a light lunch at best. I’ve been checking in and using Foursquare for almost six months thinking that they would figure something out but it’s taking far too long. The message I am getting from most of my friends on my check-ins is – why?

So in my view neither Facebook nor Foursquare accomplished much last week. But couponing site Groupon (www.groupon.com) had a GREAT week (see the article in Forbes) http://tcrn.ch/bLhcxt . Groupon launched its first nationwide deal – at $ 25.00 off discount on a $ 50.00 purchase at Gap. It became so popular so fast that it actually crashed Groupon’s servers for a time. In total it looks like more than 400,000 coupons will be sold (Figure more than $ 11,000,000 in total). Groupon won’t disclose the specifics of the deal regarding profit margins. Since Gap offered such a steep discount I’m not completely certain what they accomplished besides some pretty expensive brand buzz.

Groupon’s ‘deal of the day’ is gaining momentum and the company is actually making money (yes they have a revenue model – how about that?!). From Wikipedia – The company offers one “Groupon” per day in each of the markets it serves. The Groupon works as an assurance contract using ThePoint’s platform: if a certain number of people sign up for the offer, then the deal becomes available to all, if the predetermined minimum is not met, no one gets the deal that day. This reduces risk for retailers, who can treat the coupons as quantity discounts as well as sales promotion tools. Groupon makes money by getting a cut of the deal from the retailers. There are certain businesses that Groupon will not offer its services to, including shooting ranges, abortion clinics, plastic surgeons and strip clubs.

There are other couponing sites – Thrillist, Woot, Living Social, MyCityDeal, but Groupon is the current first round leader.

So while Facebook frets about the new movie (Social Network,)coming out that has less than flattering portrayals of Marc Zuckerberg and the team that got it started, Foursquare continues to try to figure out how it could actually make some money, Groupon is coming on strong and I think they may have one of the strongest new revenue models out there.

Are you going to give Groupon a try?

We took a trip this week to visit two more universities – two large public institutions – our daughter wants the whole college experience complete with big time athletics (to attend not to play), academic programs and diversity in the student body, and of course a vibrant social life.

The seemingly endless amount of college rating books offer a fun and interesting read. But I came to realize that the marketing of those colleges only begins with those books. Should a student show interest (and even if they don’t) the never-ending parade of literature sent via the USPS (it may be keeping the USPS in business – at least for now) is truly impressive.

Colleges and universities have definitive brand identities. And yet the marketing of these institutions displays the very essence of direct marketing. What could be a more personal and one-to-one decision than deciding where to spend 4 years (or 5 or 6 as it is these days) of one’s life. Not to mention as much as $ 200,000 at the top end for those that can afford it!

Statistics offered by colleges and universities play a big role. SAT/ACT scores, GPA, % of incoming freshman accepted vs. total applications, – this creates cachet and excitement, as well as angst and heartache. Our daughter now has her heart set on a school that might be considered a reach – she claims she will be mortified if she does not get in. The performance of athletic teams, as well as top line artists coming to perform at the school creates buzz and excitement – all adding to its brand identity.

The experience of visiting the school, taking the tour and experiencing the campus is invigorating and always makes me (and my wife) wish we could go back to those carefree days of college (which somehow did not seem so carefree when we were there). Like my Dad still says – ‘education is often wasted on the young’.

Years after graduation the alumni are encouraged to remain a part of the family (and donate a building if you can please – or whatever you can) and thus the brand relationship continues. Word of mouth marketing comes into play aiding the brand positioning with alumni waxing poetically about their days on campus and all the great things that were experienced.

How often do you reminisce about those college days? Are you helping advance your alma mater’s brand?

Back in the 1950’s before the credit card era, layaway or installment plans became popular. It enabled consumers to assure they could purchase that special gift for someone they cared about – or even for themselves.

The 2008-2010 (yes isn’t it almost three years now?) recession has brought back layaway plans as consumer credit has tightened and consumers take pains to manage their finances to a greater degree. Traditionally from the banking sector these plans have common themes – low interest and often many restrictions. Store layaways were a little more flexible although they too offer little or no interest and of course they are far from portable.

I’ve never thought much of layaway or Christmas club plans due to the drawbacks and limitations noted above. They may seem like a good idea but I liken them to getting money back on your taxes which makes you happy until you realize that you’ve given the government a tax-free loan. The best tax return is a net zero as far as I am concerned.

Yet at the same time I a champion for responsible consumer spending and the recent past has shown that Americans in particular liked to spend money they did not have. Layaway plans at least address this concern and with the economy still in need of a shot in the arm of consumer spending, the idea of setting aside funds for the holidays could be a way for this coming holiday season to be just a bit brighter for retailers – and consumers alike.

Each year I go off with a bunch of guys on an annual trip for a few days to Myrtle Beach, SC to play golf and have fun. For the past few years we’ve arranged for our credit cards to be debited a set amount each month over 9 months such that when the always eagerly anticipated trip comes about – it’s already paid for. It’s worked well for all of us and while I am not suggesting I am going to do this for this coming holiday season I do understand the value of taking time to pay something down BEFORE the event. There’s something great about heading to the airport for our annual trip knowing that all is paid for except dinner. Yes there’s a refund policy and cancellation date (pretty close to the event date) so if something were to happen I could get out with all of my ‘investment’ – not true of some layaway plans.

How about you – would you consider a layaway or installment plan for the holidays or anything else?

It seemed like a good way for me to keep up with the email onslaught so I slid my credit card in the slot and pretty easily went through the procedure. I was a bit surprised the find out that the cost was $ 12.95 for the entire flight. In checking the prices after the fact it seems they are somewhat inconsistent in that some airlines are as much as $ 15 and others just under $ 10.

In looking around I appeared to be the only one who was availing himself of the service. Once I logged on I found that gogo offers spotty service – sometimes the speed was reminiscent of dial-up modem service. Without a doubt it was never as fast as cable or DSL service but there’s no mention of that on the sign-up page.

Despite the sometimes glacial pace of the service, gogo in flight internet was useful as I was able to get a good amount of work accomplished in what normally would have been time spent reading (I did a lot of that as well given this was a 5 hour flight) or watching in flight television. Given that I spent about 2 hours working $ 6.50/hour seemed more than a little steep to me.

On the gogo site I now come to find out that I could have pre-bought (what is it about airlines with the paying before thing?) the flight for $ 11.00. Of course that was not offered to me during sign-up ON the flight itself. I can also buy a gogo 30 day pass for $ 29.95. I would have been extremely agitated had I chosen that option only to find out that the service is not offered on all Virgin America flights.

I now also know that I can buy a gogo 6 pack for $ 49.95 which is better deal but this is a limited time offer. Why I have no idea. Gogo also offers flights up to 1.5 hours for $ 4.95. Given that it takes about 20 minutes before you can turn your laptop on after takeoff and you have to turn off electronics 10 minutes before the plane lands that leaves about an hour for $ 4.95. A deal for 1.5-3 hours for $ 9.95 is hardly a much better deal.

Anytime a new technology emerges there are bugs that need to be worked out and early adopters often get treated the worst (I can speak from experience with my original Kindle and Blackberry Storm).

I will use the service again on a future flight and hope to find improvements in the gogo service (or whatever service is offered). Having internet access on flights is a great thing overall although I did not try (but thought about it) Skype to see if I could make a call while flying at 35,000 feet.

How about you – would you use in flight internet service? Or is the air your respite from constant communication?

Yet at its core, the prospect of people cutting spending on things like apparel and inessential big purchases – like automobiles and giant flat screen televisions, should not be seen as a bad thing. Weren’t we told that Americans HAD to increase their savings rate? That rate is now up to 6.4% from the latest report about three times greater than 2 years ago. An article in today’s NY Times highlights the challenges of retailers and the economy in general – http://nyti.ms/9ylhPl

Economists never agree but there does seem to be consensus that consumer spending which represents 70% of the American economy has to move forward in order to enable a real recovery to take place. Since retail sales were so bad a year ago, John Long, a retail strategist at Kurt Salmon Associates noted “that should have made this July’s comp a layup”.

An article in the Wall Street Journal earlier this week http://bit.ly/ayAGVe noted that sales of technology and electronics are bright spots but those sales appear to be coming at the expense of items like clothing and appliances.

I cannot for a moment imagine that returning to the ways of the recent past – profligate spending and people spending money they did not have in the first place – will result in economic salvation.

We run a marketing agency and our primary focus is helping our clients gain and retain customers. Consequently consumer (and business for that matter) spending is critical to our mutual success. However I am not disappointed that Americans are being more careful about how much they are spending while at the same time increasing their savings.

The big problem for businesses like ours is getting banks to loosen up their purse strings and actually lend money for expansion and growth for small businesses. But if a return to spending money one does not really have is the answer we are in a lot more trouble than I ever could have imagined.

Agree? Disagree?