The ability to look outward has always been marketing’s forte; we leave the inward-looking stuff to accounts and IT. But to succeed in the Noughties direct marketers will have to look further than ever before: beyond their usual customer base, beyond their real and perceived frontiers, and even beyond their traditional sectors.
The reasons are twofold. Firstly, the rest of the world isn’t just a customer base, it’s also a supplier base. When we see that at this year’s International Direct Marketing Fair (IDMF 22-24 February, Earls Court 2, London) suppliers from 10 countries have booked stands, we realise how intent our overseas contemporaries are on entering the UK’s lucrative market.
Secondly, it’s my view that the move towards permission-based marketing will so restrict the ability to conduct major mailings in the UK that, as an industry, we will have to look much further afield.
It seems that the forces of law, order and bureaucracy have been ranged against the DM industry in recent years. The introduction of the Privacy & Electronic Communications Regulations 2003 coupled with the curtailment of access to the electoral roll has had a considerable impact on the integrity of consumer data files. The ability of any organisation to claim to be able to get into every home in the UK is now severely limited. Consumer files that were complete two to three years ago are now compromised and estimates suggest the content of these files is deteriorating at a rate of up to 30 per cent per annum.
The natural result of less access directly to the consumer is an increase in B2B activity. Most consumers have money to spend because they have a job, and their place of work is still targetable. Small business owners are already seeing this effect, as the parcel of direct mail that arrives every day contains personal, as well as business offers.
Any possessor of a business email inbox knows that this is happening too. The majority of spam emails received at work are of a personal, not a business, nature. The same applies to texts received on company mobile phones. It is, however, against the CAP Code to send a personal marketing message to a business email address or a company mobile phone without the consent of the recipient. Businesses are also being targeted relentlessly by telemarketers and fax marketers, frequently offering services unrelated to the company itself. Hence businesses can now register on the Fax Preference Service and the Corporate Telephone Preference Service.
Without the full range of protection enjoyed by individuals under the Data Protection Act 1998 and the Privacy & Electronic Communications Regulations 2003, businesses are beginning to feel under siege. Some small companies have stopped publishing their fax numbers at all, and in order to get the day’s work done, retreat behind voicemails and firewalls. As a result of this, one can only assume that DM response levels are in danger of falling in both the UK’s B2C and B2B sectors.
However, I’m pleased to say that I believe any announcement of the death of direct marketing to be premature! We may be feeling DM-fatigued in the UK but other countries have a different attitude.
Research by the pan-European business database company EuroContactPool indicates that Eastern Europe is just switching on to direct marketing. The Polish consumer receives around 20 items of direct mail a year (half with their name on) compared with 680 received by their equivalent in the Netherlands. It’s hardly rocket science to recognise the potential of this new and DM-receptive audience.
Within the UK businesses have to adapt and refashion how they talk to customers and prospects and in my view, it won’t necessarily focus on electronic communications.
As an example, BA’s Executive Club is developing one of the most valuable senior executive databases around. Avis, meanwhile, has used Optecon’s 042 product to place marketing messages on bills and statements, generating a staggering 10 per cent response rate.
The versatility of variable digital print will enable the individual personalisation of every mailpiece, not just by name, but by content too.
For some businesses the solution will be to spread their wings and look at the markets that still find our approach fresh and interesting. For those who choose to remain within the lucrative established markets, permission marketing is the future. Expect to see a plethora of permission marketing options, ideas and solutions emerging during 2005. And let’s hope they do because if our business doesn’t catch on to this soon, even my renowned optimism will start to wane.