Could a retail slowdown help mail advertising?

Today a number of stories illustrated the weakness in the consumer economy.

The Associated Press reported that consumer spending in July, the traditional beginning of the back to school season continued to decline in items other that food, gasoline, and automobiles.   is resulting in a below expectations back-to-school season "Sales were down 1 percent at department stores and also dropped at specialty clothing stores, furniture stores, hardware stores and appliance stores."

Bloomberg reported Both J.C Penney's and Kohl's, department stores that cater to a broad cross-section of American consumers both reduced guidance in the third quarter. (July-though September) "J.C. Penney is counting on consumers doing their back-to-school shopping later this year as they shop closer to the start of the school year."   The lowered earnings guidance and reliance on later season sales suggests that a higher share of back-to-school across all retailers will be sold at a discount and greater promotional activity (i.e. advertising across all modes including mail) will be required to induce consumer spending.

Another indication that retailers may have anticipated stronger retail sales than are now developing is the continuing growth in both domestic and international intermodal rail volumes.  A recent W.H Blair analysis reports the following:

Absolute [rail] intermodal volumes at 2008 levels, +20% yoy for week 31 (+0% vs. 2008). 2Q's seasonal momentum has continued into 3Q. Intermodal volumes to end [of] July / begin[ing of] August were 2% above mid-June volumes, modestly better than traditional seasonal 1% improvement; improvement was realized within both international and domestic lanes. We expect both domestic and international growth to continue given ongoing domestic truckload conversion, rebounding ocean freight import volumes and modest economic growth. 

So what does this mean for the Postal Service and firms trying to sell mail as an advertising media?

Now is the time to start contacting retailers before they realize how serious their need is likely to be. this is particularly true for smaller retailers that have the least sophisticated sales tracking systems that most major chains now have.  Now is the time to develop ideas for using the mail to boost sales earlier in the season to reduce the risk that items in the supply chain from overseas suppliers will need to be sold at a large end-of-season discount and begin presenting these ideas to potential customers.     Finally, now is the time to start talking to retailers about the need to plan print purchases in order to ensure that the print capacity they need is available when they will need it.