Issue No. 13 | June 30, 2026

Intelligence for direct marketers in insurance, home services, warranty, and protection.

This Week: Inflation Confirmed

THE NUMBER: 4.2%

BLS CPI for May 2026 came in at 4.2% year over year, the highest reading since April 2023, with energy up 23.5% over the same period. The Federal Reserve held rates at 3.50–3.75% for the fourth consecutive meeting on June 17, Kevin Warsh’s first FOMC as chair, and raised the median year-end rate projection from 3.4% to 3.8%. Nine committee members are now backing at least one additional hike. Stage 3, the fork where the Iran conflict either faded or persisted, has resolved. It persisted.

For DTC VSC and home warranty marketers, that confirmation is a meaningful tailwind. Consumers absorbing repair costs 43.6% higher than January 2019, with no immediate rate relief ahead, are increasingly motivated buyers. The economic case for your product is materially stronger than it was just a few years ago.

THE OPERATIONAL ANGLE

The demand environment is favorable. The acquisition economics are not keeping up.

Rising list costs, postage rates, and media inflation are compressing margin on the acquisition side at the same time the underlying demand grows. The macro tailwind does not automatically protect your CPA. A program running on last quarter’s cost assumptions may look healthy on response rate and miss what is happening on cost per funded contract. The confirmed inflationary environment means your reach costs more than it did 12 months ago.

Offer efficiency is the operating advantage, not expanded spend. Response rate segmentation by audience tier, down payment structure, and term optimization determines who converts at what cost. In a 4.2% inflation environment with postage and media costs moving up, the programs that perform best are the ones that maximize yield from the list they already have before scaling into higher-cost incremental audiences.

The confirmed inflation path does not last indefinitely. The programs that use this window efficiently build a stronger base. The ones chasing volume without protecting margin feel the compression first.

FROM THE BLOG

What the War in Iran Means for DTC and Dealership Marketers

Earlier this year, we outlined how an Iran-driven inflation shock could flow through oil markets into consumer prices and ultimately into demand for protection products. The May CPI and Federal Reserve data suggest the persistent Stage 3 path described in that analysis is now becoming the operating environment.

QUICK HIT

Motor vehicle repair CPI is up 43.6% since January 2019. In 2025 alone it rose 9.02%. The consumers on your list know what a repair costs today. Your creative should reflect what they already know.

Until next Tuesday —

If you want to pressure-test your acquisition economics against the current cost environment, reply here and we’ll book 20 minutes to walk through it.