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Home arrow Library of Research Articles arrow Marketing arrow Economic Impact Analysis 2005
Economic Impact Analysis 2005 PDF Print E-mail
Written by Direct Marketing Assoc   
13 Jan 2006

Economic Impact Analysis 2005, Written By the Direct Marketing Industry

 Executive summary

Overall, this study has worked successfully to generate a range of data and estimates that have not previously been available to the direct marketing industry. The results show that the size and economic impact of the industry on the UK economy is very significant and that the level of employment and sales generated by direct marketing activity is making a valuable and important economic contribution to UK plc – supporting 3% of total employment, and generating around 9% of consumer sales.

•The total value of expenditure on direct marketing by organisations in the UK is estimated to be £37.1 billion p.a. (based on the last financial year).

This figure comprises three separate calculations:
o £14.1 billion on expenditure in budgets for direct marketing
activities (equivalent to media spend)

o £13.2 billion on direct employment costs in salaries

o £9.8 billion on overheads associated with employment of direct marketing staff

The total number of employees generated by the direct marketing industry in the UK is estimated to be 814,000 or 2.9% of the workforce. This too is made up of three components:

o 504,000 directly employed in planning, executing and analysing direct marketing activities (this does not include employees in inbound call centres which have been excluded from this study). This makes it larger than hospitality and the food sectors in the UK.

o 206,000 indirectly employed as a result of direct marketing activities, such as postal and telecoms workers part of whose work is generated through direct marketing activities

o 104,000 induced jobs meaning those who are in employment due to the salaries and wages spent by the two groups above in the consumer economy in shops and service providers

Sales attributed to direct marketing activity total £107 billion p.a. This is estimated to split roughly 60:40 between consumer and business-tobusiness sales, with £67 billion of consumer sales and £40 billion business sales resulting from direct marketing. The consumer sales account for 9% of the total annual figure of £750 billion consumer expenditure in the UK

last year – more than is spent on clothes (£43 billion) and furniture (£40 billion). Overall (combining consumer and business sales) £20 billion comes from mail order/home shopping and £14 billion is transacted over the internet – the first time we have had a reliable estimate of the value of UK internet sales.

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Last Updated ( 17 Jan 2006 )
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