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Business Outlook 2003

December 2002 By Paul Barbagallo
Industry experts get serious about privacy, postage, telemarketing and more.

Reported by Paul Barbagallo, Brian Howard & Hallie Mummert

Privacy. The U.S. Postal Service. Telemarketing. Congress. These four topics dominated the discussion at Target Marketing's Business Outlook 2003 breakfast, held during the Direct Marketing Association conference in San Francisco in October.

We gathered a distinguished panel of industry experts to outline the major issues direct marketers will face next year, and found that the more the industry changes, the more it stays the same.

When Target Marketing convened a roundtable seven years ago to discuss the future of direct marketing, we gnashed teeth over these same four topics, and the threat they pose to the industry's progression toward a one-to-one marketing approach.

But industry regulation and rising acquisition costs are not the death knell for the direct marketing industry. They are the realities of doing business in the 21st century that Venture Worldwide President Richard Baumer affirms will force direct marketers to "adapt or perish."

"To survive," says Baumer, "marketers have to be more aggressive and get outside of their comfort zone."

Judging from the panel's predictions for 2003, marketers can look forward to growth and innovation—but they first must address privacy and telemarketing legislation, as well as escalating postal rates.

Prediction #1: Privacy Laws will Further Restrict Direct Marketers

The specter of privacy legislation looms over direct marketing like the grim reaper itself. The industry is being reigned in and regulated by acronyms like DNC, GLB and HIPAA. And that's just the beginning.

As DMA President Bob Wientzen warned in his opening address to the DMA annual conference, there are more than 1,500 initiatives before state and local governments that could drastically alter the face of direct marketing.

Our panel of industry experts expressed deep concern over the shape of the legislative landscape where privacy is concerned.

"One of the biggest boons to direct marketing in the last 20 years has been the rise of database marketing," explains Jock Bickert, president of Looking Glass Inc., "And [database marketing] has been on a collision course with all the privacy concerns of the last five to six years."

According to Bickert, consumers are much more aware of how their information is being used, and while they're still willing to share it, they have come to expect more when they do.

"In the United States, we assume we have a right to market … and we do," offers Liz Kislik, president of consultancy Liz Kislik Associates LLC. "There's also a privilege, and taking that seriously means thinking about what customers want and expect. … The majority don't worry about data [protection] unless triggered by the annoyance of intrusion."
 

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