UK marketing budgets fell in Q1 2025 for the first time in four years. The IPA Bellwether Report cited National Insurance increases and minimum wage hikes as contributing factors; costs that landed on businesses before any wider economic pressures had even fully taken hold.
Most marketing teams know what happens next. Budgets get scrutinised. Every line item has to justify itself. And physical channels - print, direct mail, anything with a cost-per-piece attached to it - tend to be the first things that get cut.
I understand the instinct. But I think it is usually the wrong call. And the data from the same period makes for interesting reading: even as overall marketing budgets fell, direct marketing budgets went the other way, revised upward by a net balance of +9.0% in Q1 2025. Somebody, somewhere, was making a different decision.
The argument for cutting direct mail under budget pressure tends to rest on two assumptions: that it is expensive, and that it is hard to measure. Both are less true than they used to be.
On cost, direct mail does have a higher cost per piece than email. That is not in dispute. But cost per piece is not the same as cost per response, and it is certainly not the same as cost per acquisition. The ANA/DMA Response Rate Report puts the average direct mail response rate at 4.4%, against 0.12% for email. That is not a marginal difference. When you are being asked to do more with less, the channel that generates more responses per pound spent deserves a harder look, not an easier cut.
On measurement, this is where the argument against direct mail has aged badly. QR codes, unique promo codes, dedicated landing pages: the attribution tools are there. The campaigns that perform best are the ones built to be measured from the start. If your direct mail is hard to attribute, that is a campaign design problem, not a channel problem.
Inboxes are saturated. Click-through rates are falling. Cookie deprecation has made retargeting more expensive and less precise. Consumers have developed a genuine immunity to the volume of digital advertising they see every day, not because they are hostile to brands, but because there is simply too much.
A physical piece of mail lands differently. It gets handled. It sits in a home or on a desk for an average of 17 days compared to seconds for an email. It does not get blocked by an ad filter or lost in a promotions tab. That extended presence in someone's physical environment is something no digital channel can replicate, and in a noisy market, it is worth paying for.
The sectors doing this most effectively tend to share one characteristic: they have decided that standing out is worth the investment, and they have chosen the channel that delivers when digital has stopped working as well as it used to. Financial services, subscription businesses, healthcare, retail; these are not industries with unlimited budgets. They are industries where customer acquisition is expensive and lifetime value justifies a channel that cuts through.
What they understand is that rising costs do not change the fundamental need to reach customers, build relationships, and drive revenue. What rising costs do is raise the bar for every channel to prove its worth. Direct mail, done well, clears that bar.
There is also a less-discussed advantage to protecting direct mail spend when others are pulling back: less competition for attention in the physical mailbox. When your competitors are cutting their direct mail programmes, your piece arrives into a less crowded environment. The channel becomes more effective precisely because others have decided it is too expensive.
The businesses that lean into direct mail now, while budgets are under pressure and others are retreating, will be in a stronger position when conditions ease. Not because they were brave, but because they kept doing something that works while everyone else paused.
Whether you are looking to make a tighter budget work harder, or you want to understand where direct mail fits in your current mix, we are happy to talk it through. Book 15 minutes with us below. No pitch, no pressure, just a practical conversation about what is actually worth doing.