Printed door drops are a powerful sales driver. So why are they under threat?

Read also Part 2 of our Door Drop Series, Print Power talked to Europe’s leading letterbox marketers to find out how they can future-proof the flyers industry…

The figures don’t lie. Defying all those critics who extol the virtues of digital over print, door drop advertising is a hugely effective channel for driving high customer engagement, raising brand awareness and boosting sales.  

A door drop can come in a variety of unaddressed and branded printed formats. From a flyer or leaflet to a product sample or simple postcard with a QR code that takes you directly to an offer online. And depending on the distribution method used, they can be sent as a single piece of marketing separate to your regular mail, or posted by your mail service provider along with your letters. They can be included in a bundle of other door drops, in a plastic wrapping, or without. They might be bundled inside a carrier like a local free newspaper. Or they might be sent to you bundled with or without a carrier as part of a subscription-based service. The options available in each country in Europe differ according to which distribution methods are available. For example, in Germany, less than 10% of door drops go out via leaflet distribution companies, one quarter of the total volume sent out via the national post service Einkauf Aktuell, and the majority is delivered via free weekly newspapers.

Whatever the format, door drops are a targeted and highly cost-effective way of getting your message directly into the homes and hands of customers. And in a world of digital bombardment where fake news has eroded trust in online messaging, marketing and security, the physicality of a door drop gives a brand a unique opportunity to cut through the noise and get one-on-one attention from a potential new customer. And while door drops don’t use personal data, they can still be targeted to reach the neighbourhoods within driving distance of a specific location or to the households that match a brand’s desired demographic.

Recent JICMAIL golden insights research reveals that one million door drops generate over three million impressions because of household sharing, while adding door drops to in-home media has been proven to deliver considerable value to a multi-channel campaign. JICMAIL research also reveals that they drive footfall to shops and online, resulting in an uplift of 20-25% in sales. They’re also incredibly attention efficient. Door drops cost around £0.10 per minute of attention, compared to social display at £0.19 per minute, with charity and grocer door drops recording the highest attention. They even do well against direct mail. While addressed mail commands two minutes of attention over 28 days, a door drop commands nearly 40 seconds. A print and digital blended success story which flies in the face of marketers who are shunning print in the channel mix.

So if the results are so compelling, why then is the future for this highly engaging marketing channel under threat? Its challenges are three-fold:

Local government resistance

In the EU, there are growing restrictions on door drops, mainly because of green lobbying that demands an end to paper that might end up unread in the bin. And because of costs incurred by waste paper collection and recycling. The Netherlands had a system whereby a home owner can display a no/no to leaflets or free newspapers sticker, a no/yes sticker, or since the beginning of 2018 in Amsterdam and in an increasing number of municipalities, a YES sticker. Spotta is now rolling out an online opt-in system to replace this, whereby a household can choose between no leaflets, a package with all leaflets, or a personalised leaflet package. Until last year, they used to have the largest volume of leaflets in one pack, but they’re decreasing due to the introduction of the YES sticker.

You have to explicitly opt out using a door sticker in Germany too. The German government has been examining the possibility of opting in rather than opting out, but the Federal Ministry of Justice is concerned that this will disadvantage the freedom of the press as well as local businesses. France has a similar system with its ‘Stop Pub’ signs, while certain areas like Bordeaux, Grenoble and Nancy are trialling a stricter opt-in sticker which is part of a three-year test involving 2 million households. The exception is the UK that has no restrictions and is seeing great performance results from door drops.

Consumer backlash

Some customers are pushing back against receiving printed marketing simply because they don’t read unaddressed mail. That’s why, in Europe at least, more and more households are displaying the no/no stickers.

And as consumers are exposed to more and more messaging around sustainability, there’s a misconception that paper is destroying forests and is non-sustainable. They’re not educated about the hidden environmental costs and carbon footprint of digital. Or about the fact that European forestry is tightly monitored and controlled by certification. Research by Two Sides reveals that 60% of Europeans believe that electronic communications are better for the environment than paper-based communications. While their 2019 research revealed that the electronic waste industry was responsible for a gigantic 53.6 million metric tonnes of e-waste across the world – equivalent to the colossal weight of 350 cruise ships.

Brand behaviour

Although there’s a veritable vault of evidence that proves door drops are a powerful sales driver, brands are not only bowing to pressure about Environmental, Social and Governance (ESG) concerns, they’re also reconsidering how they communicate with customers due to the increasing costs around paper prices, production and distribution. In Germany for instance, DIY chain OBI stopped the use of door drops before tentatively coming back to the market to test a two-pronged system of door drops combined with addressed mail to customers in their database. While hypermarket E. Leclerc in France halted the use of door drops after being the first to stop the use of plastic bags. Also in France, the Milee promotional Group has launched the subscription-based 150€ magazine filled with promotional material from brands like Aldi, Carrefour, Netto and Bricorama and it’s already at 1.4million subscribers. A canny way to get around the problem of permission by wrapping editorial around their offers.

As laid out above, it’s becoming incredibly difficult to reach a high volume of consumers at low cost, so much so that the typical Byron Sharp strategy of constantly attracting new customers instead of just targeting a core group of loyal customers might no longer be viable.

So just how will the future for door drops pan out in the next two years? And what will the strategy be for door drops to survive and thrive? MD of Print Power Europe Ulbe Jelluma hosted a panel discussion with Europe’s leading door drop companies. In Part I of our Door Drop Series, he asked them just that…

The panel consisted of:

Sebastian Mitter, CMO of Prospega Group – a media agency specialising in local offer communications, mainly covering Germany and neighbouring countries. Between 60% to 70% of their turnover involves booking leaflets with free weekly newspapers, leaflet distribution organisations and postal organisations.

Martin Twellmeyer, CEO and co-founder of Optilyz - Europe's market leader for direct mail automation. The German company was active in door drops until 2017 but now focuses on addressed mail.  

Thomas Hopman, CCO of Spotta - the only remaining nationwide network for door drop delivery in the Netherlands. He’s also the chairman of the industry association MailDB.

Aldo Breed - founder of Kiesjefolders – offering a combination of printed and standard leaflets as well as direct addressed mail in the Netherlands. Subscribers pick which leaflets they want to receive and the front page of their leaflet bundle is also personalised with ads.

Mark Davies, MD of Whistl’s door drop division that manages addressed mail, parcels, ecommerce fulfilment, contact centres and door drops. He’s also the president of ELMA, the European letterbox Marketing Association.

Ulbe Jelluma

How do you see the situation evolving for door drops in the next two or three years? 

Thomas Hopman 

Well what we see with local governments and with our advertisers is that sustainability is becoming more important. They're willing to accept more costs, or perhaps for short periods, a lesser result when they reduce the regularity of a door drop. We believe the way forward is going from unsolicited to requested in door drops. We need to get the consumer more in play so they’re more directly at the table saying ‘I want your leaflet’. Getting out the last bit of waste is the way forward.

Ulbe Jelluma 

And permission based is one way of doing it? Because that's not a solution to the problem of sustainability.

Thomas Hopman 

Well it depends because it might eradicate the last bit of waste. We still have a small percentage of households that receive door drops every week, and they throw them out or read a very limited number of leaflets. We have the same proposition that Kiesjefolders has where you can personalise your own leaflet package. We think that a decent number of Dutch consumers are interested in that, next to the large group of households that want to receive all leaflets. In the end, you get a lower reach, but much more effectiveness.

Ulbe Jelluma

And in your view, that's got what's going to happen in the next two to three years - permission based door drops?

Thomas Hopman 

If you do not act, our advertisers will take those decisions for you. I think the opt-in system in the Netherlands is a bit of a sign that we've waited too long. 

Aldo Breed 

I agree. The retailers who have partnered with Kiesjefolders are very enthusiastic about the results when consumers ask for their own leaflets. In some bigger cities, we already have a significant reach. When we do tests with specific offers, you can see that distributing door drops via addressed distribution is very successful. Compared to normal distribution, the costs for effective reach using addressed distribution are lower because there are so many door drops that are normally wasted. As advertisers want to communicate with customers at the lowest cost possible, they first want to put as much effort into their own media. But then, they are only communicating with existing customers, so they need door drops to reach customers who are not in their database. The Kiesjefolders system gives good results. For example, we did a test with a food retailer, and they saw an increase in sales in relevant stores of about 2 to 4%. Enough reason to scale up distribution with us. We are still at the beginning and already have 200,000 addresses in Holland that we can reach weekly.

Thomas Hopman

There are big differences between the target groups and even per sector. So for instance, we've learned due to opt-in that around 45% of Dutch consumers are door drop lovers - they want to receive everything, all the door drops. And then there's a group that doesn't want any door drops. And then there's a group that only wants certain door drops, perhaps in a certain time of their lives or year etc. And being more specific in our reach is the next step. 

Sebastian Mitter 

The Netherlands has the most volume per capita in Europe of door drops so it’s hard to derive the future of door drops from the Netherlands point of view.

The whole ad stop discussion we had in Germany has mainly gone totally silent for now. I don't hear about it anymore because the German postal service switched from plastic folders to paper for leaflet delivery. This was a big step as it was the main complaint from the environmentalists - that the leaflets are plastic wrapped. At the end of this year, the German post will have faded out all plastic. So the German market is not as challenged by regulatory changes as other European countries are, although the volume itself has come down a bit too. The other thing driving the situation is that we have less stationary retail companies competing with each other. Less competition in retail means less opportunities for us.

I think the big development will be that the retailers are more engaged in developing own media channels to earn more money from the brands. So we should be communicating with the brands directly about the effectiveness of our industry and the chances of a local media mix using the most effective way to reach the consumer. To invest your marketing money only on customers who are already on a database and turn a blind eye to filling your sales funnel with new customers is, I think, the blind spot. And that’s why print-based offer communications still provide the best opportunity for driving customers in-store and generating new customers.

Ulbe Jelluma

Are there any barriers in getting access to those brands? Are they willing to listen to you? Because one of the problems we see in other countries is that marketeers today don't have paper and printed material on top of their list of channels. 

Sebastian Mitter

The thing is, you have to communicate on various channels to the marketing decision makers in the big companies who are in branding, and you have to talk their language. The retailers already know what leaflet marketing can achieve. The brands basically only know on a meta level as they give money as advertising allowance to the retailers to spend the money. And it's a real challenge to find the right guy to talk to in a company like for instance, Nestlé. On the contrary, the media executives of stationary retail chains are well-known for the various players in the industry. With big brands, the challenge is finding the right person who has ownership. But you could get them with effectiveness stats, convincing cases and with examples. Effectiveness is on our side.

Regarding the current media market development, print volumes in the beginning of this year were slightly challenged compared to last year when we came out of Corona and the market really spent media budgets into it.

But to put it into perspective, most of the media channels are losing at the moment. In the first quarter, digital has lost 7% of its budget, magazines are losing shares and TV is losing around 14%. So print media is not alone – the whole media market is shrinking currently. The marketing landscape has witnessed significant changes in recent times, particularly with the rise of digital channels. However, there are early indications that some retailers are re-evaluating their decision to cancel leaflets as a means to connect with local consumers. The potential loss of reach and the effectiveness of print marketing in communicating offers has prompted a reconsideration. I think with a stronger half of 2023 and with decreasing printing costs, print markets have the opportunity to rebound. 

Ulbe Jellluma

Martin, you are not into door drops, but addressed mail. From that perspective, what is your view on how your door drops might evolve in the next two years?

Martin Twellmeyer

It's interesting what Sebastian said because I was on stage at a huge marketing conference in Hamburg last week with OBI. They previously used door drops as a measure for communication and completely abandoned it publicly last year. Our master class with OBI was around how they started to change their company strategy, and how that went into abandoning the door drop. We are certainly not a replacement, but there is no thinking about getting door drops back as I’ve not heard from them that it hurt them in a massive way, which is interesting. 

I think the last months for all retailers have been very challenging. While the German market is thinking about door drops from a sustainability perspective, that sustainability perspective is not always a rational one. It’s a perception that's the problem and we need to change that perception. There are many arguments about recycling paper and reforestation and it’s not as bad as people think. That's why someone like a CEO at the top might just say get rid of door drops, even though it hurts the business. So, I think door drops will continue to be under pressure. And many retailers are looking at ways of how to gain more first-party data and find different ways of targeting and approaching people. I think at least in the short term, this perception is not going to change.

Mark Davies

Yes, we’re seeing attacks on all sides, whether it's environmental, whether its economic, whether it's marketing, or just a different marketing philosophy. But at the same time, we are seeing a kind of growth in terms of winning certain clients back or new clients coming in. My prognosis is that for many brands and distribution companies, they have to get used to the fact that they've gone past peak door drop. Volumes may never recover at the levels that they once were, but there are plenty of new customers who are lining up to potentially take advantage of the channel and the reach we have into households. 

There are regulatory changes that are about to impact digital marketing heavily and will give wings to the case for door drops. There is a queasiness about over reliance on Google and Meta. There is the concern about performance dipping. Everyone is waiting for the main event in terms of new privacy regulations. Who knows where that's going to end up. But I think all of this is beginning to erode a bit of confidence in marketers. The fact that even Google hasn't come up with a satisfactory solution for third party cookies, and keeps kicking the can down the road in terms of the deadline. It’s seen and perceived to be a digital problem requiring a digital solution. Whereas door drops, and many other traditional marketing channels, have some half decent solutions to the problem of how to get cost effective reach in media. 

Even the most vociferous advocate of digital services has to accept that the likely outcome is that world will be smaller, more expensive, and probably slightly less effective than it has been perceived. That seismic change doesn't mean that that money is predestined to come back into print or into door drops. But if we have the right arguments, we can demonstrate the right success. The results are there and that’s the exciting bit.  

Regarding the OBI DIY chain in Germany that stopped using door drops. They're saying, well we have a database of people who registered during COVID, and we're going to use that database to do targeted mail. Would it be a successful kind of replacement for door drops? No, not entirely, because I think it's missing the point about door drops. Those targeted databases can be very useful for somebody who's looking to grow their business through warm mail. And I'm not going to speak against mail because I've got a vested interest in it. It's a perfectly valid strategy to pursue. But what targeted mail like that can't do is bring brand new customers, and that's what door drops can do.

From the challenge faced by retail companies enticing brands to own media, to the innovative new developments in door drop strategy, check out Part 2 of our Door Drop serie here