Clean-up operation

Faced with the real threat of legislative extinction, the direct marketing industry has adopted stringent self-regulation measures and brought the ‘cowboys’ into line.

A live bullet arriving in the post for the head marketer. The immediate assumption would be that someone, somewhere, had you in their sights.

No surprise, then, to learn that the public relations company that sent the bullets to marketing directors as an attention-getting device got rather more attention than it was looking for – and a severe reprimand.

Bullets, scissors, devices that make ticking sounds: all are evidence that someone somewhere hasn’t thought their campaign through properly. And they are exactly the kind of mailings that grab headlines and generate furious attacks on the direct marketing industry.

But it doesn’t need some strange item arriving on the doorstep to cause pain. In the wrong circumstances, an ordinary letter in an ordinary envelope can have a devastating effect. For example, widows and widowers are frequently distressed by mail that continues to arrive for their deceased partner.

Such occasions are getting less frequent, however, and consumers are now less hostile to direct marketing than they used to be. The direct marketing industry has made enormous strides over the past decade or so to regulate itself, and to change consumer attitudes to what it does.

The Direct Mail Information Service, a research body funded by Royal Mail which looks at all aspects of the direct mail industry, has conducted regular surveys since 1985. Every two years, it asks consumers for their reactions to direct mail: and, while there have been some peaks over the past four surveys, the general trend has been downwards (see table). Perhaps the most significant finding is that only nine per cent of consumers thought direct mail was an intrusion in 1995, compared with 26 per cent in 1989.

Colin Lloyd, chief executive of the Direct Marketing Association (UK), believes that the improvement in goodwill towards direct marketing has come as a result of the industry’s efforts to clean up its act.

He says: “There has been increasing use of suppression files – not just the Mailing Preference Service or the Telephone Preference Service: there are some very good deceased files in the market. Also, there are a number of good gone-away files. These take a lot of rubbish out of mailing lists.”

For the uninitiated, a suppression file is in effect a reverse mailing list: a list of names and addresses that must not be mailed (or used for outbound telemarketing). DMA members are supposed to check all mailing lists they use against the MPS and TPS lists, and will frequently check them against other suppression files (see box).

Suppression files make good commercial sense, as well as helping direct marketers avoid causing offence or distress to people who do not wish to be approached. The more sophisticated users of direct mail are now also using suppression techniques that filter out consumers who would be unlikely to be interested in the offer being made – or, in the case of financial services mailings, such as credit and charges cards, those who would be disqualified from getting the service.

As a result, in recent years, while the total volume of direct mail has gone up, the number of items sent out in individual mailings has gone down.

But the direct marketing industry is not improving its targeting – and its image – purely for altruistic reasons, or even for commercial reasons. It is protecting its own existence. Direct marketing, perhaps more than any other form of advertising, has been for years under constant threat from external regulatory bodies, most notably the European Commission.

As with all forms of advertising, the fear has been that if the direct marketing industry did not seek to police itself, and to restrain its more extreme elements, then government would step in and take over regulation.

The industry has already had to cope with the imposition of the Data Protection regime, which has severely curtailed the ways in which it can collect and use information on consumers: it also faces various potential threats from EC directives.

Just before Christmas, for example, an EC directive was defeated that would have effectively destroyed much of the mail order industry by banning cash with order sales. The same directive would also have required direct marketers to contact every consumer on their database to ask them whether they objected to their details being used for direct mail or telemarketing purposes.

Lloyd says: “The DMA spent eight years trying to get the TPS off the ground in the UK – it was like pulling teeth. But the scheme came into its own when, just before Christmas, the Distance Contracts Directive (the EC directive governing mail order and other forms of distance selling) was being debated.”

The existence of the TPS, Lloyd maintains, enabled the DMA and its allies to defeat a proposal that any marketer who has consumers’ phone numbers stored on a database would have to write to every one of them and ask their permission to use those phone numbers for telemarketing purposes.

Lloyd adds: “What would effectively have been a ban on outbound telemarketing put the fear of God into telemarketing companies. They said, hand on heart, they would clean up their act – and I intend to hold them to that.”

Research conducted by the DMIS in the past has asked consumers to define “junk mail”. More than a third (35 per cent) cited lack of relevance – junk, they said, was items that were unwanted or of no interest. A similar number (34 per cent) said junk mail was unsolicited. One in five consumers (20 per cent) classified junk mail as any mail selling something and 18 per cent said it was advertising.

That was in 1992, however, and this particular survey was conducted again last year, with the results currently being collated. Jo Howard Brown, a director of the DMIS, says the preliminary findings indicate that consumers are less hostile than they were three years ago.

Research from Mintel – from 1991 and 1993 – paints a more confused picture. In 1993, while more people said they did not mind receiving direct mail from companies they were already dealing with or from companies they did not know, more people also objected. Overall, however, the increase in favourable responses appears to outweigh the increase in negative responses. Mintel’s research also suggests that men are more favourable to direct mail than women, perhaps because women are still being targeted by blanket and often irrelevant “housewife” campaigns.

The DMIS has also just published the results of another survey conducted last year, into how consumers react to different creative treatments.

This shows that if mailings – even cold mailings – are about products or services that are of interest to the consumer, then they are consid ered relevant and will be viewed positively.

But the research found that for some consumers there was always the concern about where the company responsible got their names from. Brown says: “The more tenuous the link between the direct mail and their interests, the more likely they are to question it.”

The research also suggests that many of the tricks of the trade favoured by direct mark eters have outworn their usefulness.

Brown observes: “Consumers now feel that certain techniques are transparent in their intent ions and, in seeing through them, reject them as too overt a sales approach or an attempt to pressurise the recipient.”

Lloyd agrees: “The consumer is getting more literate in the ways of direct marketing.

“They can see through the poor offers. I believe there are still some sacred cows of direct marketing that have to be broken – the multi-part letter, for example, or the excessive use of over-printing.”

In addition to thinking that some creative treatments could be usefully dispensed with, Lloyd also believes there is still some way to go before the industry is structurally sound.

“We have certainly cleaned ourselves up: but we haven’t reached the end of the process. I think we have got two or three years to go before we really finish cleaning up our act.”

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