State of the Industry-1999 (2,293 words)
While our respondents may have perceived costs as a top concern, some industry experts disagree with this impression. Richard M. Hochhauser, executive vice president of Harte-Hanks, the San Antonio, TX-based database marketing company, strongly denies the notion.
"Since 1993, we've had nothing but good news from the U.S. Postal Service," says Hochhauser. "The rate increase in January is good news since it's a small increase. Is it more expensive to design or print each piece today? Yes, but postal increases aren't a big factor."
Ron Greene of Devon Direct, a direct marketing agency based in Devon, PA, tries to reconcile the difference between perception and reality.
"Since 1992, paper costs have gone up, but so has the speed and quality with which you can get a mailing out," he says. "As a result of database marketing, advertisers can create more data-driven, versionalized communications to reach targeted audiences. Despite higher paper prices and higher postage, costs are at the same level or lower."
For those who can take full advantage of database marketing techniques, then, increased costs are not a problem. Those who cannot will continue to feel the pinch on their profit margins.
Labor Shortage Continues
The second-most-frequently mentioned concern was hiring qualified workers, cited by 40.9 percent of respondents. This complaint echoes the lament of businesses in all industries.
Explains Hochhauser, "In a robust economy, good people are in short supply and companies that will win in hiring are those where the culture is positive, where there is training and opportunity."
Ironically, despite the difficulties direct marketers had with hiring, only 13 percent claimed that staff training was a major issue. According to Cliff Hurst, president of Career Impact, a Wells, ME, telemarketing training company, the top criterion that younger workers use when selecting a job is availability of training. To alleviate the labor problem, he advises that direct marketers concentrate more of their human resource dollars on the back end: by retraining existing employees and training promising new hires. As long as companies persist in spending on the front end only to recruit new workers, essentially cannibalizing their competitors' staffs, the labor problem will continue.