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Going Global: Direct Marketing in Sweden

Date: December, 2011 --

Indeed, this country in the north of Europe with a tradition of strict privacy law enforcement is nevertheless an extremely attractive direct marketing and direct-mail population. Here you have over 9 million people in some 4.4 million households and 940,000 businesses in a highly evolved post-industrial society.

Not only is it wealthy, with one of the highest per capita incomes in the world, it is an exception to the Euro swamp to the south. Sweden's economy is growing at 4% this year, although this pace may slow somewhat in 2012, and its unemployment rate is down .6% this quarter to 6.9%. Inflation is low at 2.9%.

 Because it still uses the krona, it has not been sucked into the Euro disaster. It had its own financial crisis in the 90’s.  At that time it nationalized its banks and massive amounts of debt were written off in order to punch a hole in the housing bubble. The citizens collectively cooperated to cut the budget and maintain universal health care and other social benefits, all in a political environment that recognized they had an emergency that required them to put aside ideology and practice practical economics.  They were enormously successful.

The direct-mail market is sophisticated and well developed with between 17 and 20 data and list providers. It is estimated that there are approximately 1,100 B2C response lists and some 50 B2B lists. Increasingly, the mail-order lists are dwindling to be replaced by online shopper lists, but direct mail is still powerful.  As recently as 2008, 45% read DM regularly and 93% occasionally, while 26% would respond at least once a quarter.

Perhaps the single most unusual aspect of the direct marketing industry in this country of strong data protection enforcement is the government maintained “Spar” database, which has extremely accurate data on all citizens over the age of 16.  Among other data, it includes address, age, place of employment and salary.  It is publicly accessible and the postal system will help you obtain as much of it as necessary to fit the demographic you want to mail.  

Direct mail opportunities and channels are also somewhat different. Because Sweden is part of the European Union, it had to liberalize its post office and no longer has a monopoly on the mailbox.  It has substantial competition in the urban areas from a company called City Mail. There are numerous door-to-door delivery companies, some with nearly national reach, who can help you target households and have the ability to deliver even on Saturday and Sunday. 

The universal service provider, Posten, provides nationwide coverage, and like many posts in Europe, has specialized departments and products to assist the direct mail industry.  For example, it has available an opt-in list of one million consumers, called Postiad, who have indicated what products and offers are of interest to them.  Posten is in fact the result of a merger of the Swedish and Danish Posts, made possible by the liberalization of postal services in Europe since the’90’s.

The catalog industry no longer mails the vast quantities it did in the past, with the exception of the iconic Ikea, a Swedish company, but catalogs are still common, well-received and effective.  Moreover, Swedes welcome foreign brands. According to research by Deutsche Post, Swedes are quite welcoming to foreign brands and suppliers. Only 19% of Swedes prefer local suppliers, but they definitely believe that brands (68%) and quality (57%) are important factors in their purchase decisions.

Regarding e-commerce, Sweden is the most wired country in Europe, having been an early adopter, with 63% of the population on broadband. This puts it next to Germany and Luxembourg.  (The top of the list, by the way, is South Korea at over 95 %.).  Purchase preferences are similar to other northern European countries and are led by electronics and services, including airline tickets and holiday trips, followed by clothing, electronics and cosmetics. Online travel services are increasingly popular as agencies began charging fees for making reservations off-line. 

Mobile is an opt-in marketing medium, but a good one, with mobile penetration being the highest in Europe and the speeds among the fastest.  Clothing retailer H&M was one of the first adopters of the medium, running its first campaign in 1996. But, H&M still uses the mail. 

As in the United States, a very sophisticated marketing and advertising industry recommends a multimedia strategy for maximum success. For your campaign success, nothing succeeds like a correct address which is properly formatted and current. Be sure you take advantage of the skills of Data Services to assure you will be on target and deliverable.