There can be no hiding in an industry where response is the number one metric. Whatever your own experience of 2003, for just some of the movers and shakers we've spoken to, "traumatic", "bumpy" and "tough" are all emotive words that have cropped up with alarming regularity.
The year had barely begun when Claritas shed a fifth of its staff, Royal Mail slashed its agency roster by cutting its budget by a third, and email spam, through such activities as Yahoo!'s 'Dump the Junk' campaign, was the new cause celebre.
Just a few months after the industry signed off 2002 fearing it could be crippled by the loss of the Electoral Roll, 2003 threw down the gauntlet to test everyone's resolve further. Environment minister Michael Meacher was stalking the corridors of Westminster, proposing that every direct mail envelope must show the logo and contact details of the Mailing Preference Service (MPS). All the indications were that 2003 was going to be a year to endure rather than enjoy.
A year on though and, save for a few rocky patches, it doesn't look quite so bad after all. A timely re-shuffle meant that Meacher was no longer the menace he had threatened to be. Opt-out to the Electoral Roll stands at about 20 per cent, and the restriction has seen a much-needed boost of creativity in terms of new products from list and data providers.
Even Royal Mail - which has faltered of late thanks to a rash of unofficial strikes - is announcing a return to profitability. This must bode well for everybody's confidence.
The DMA, through its lobbying and extensive meetings with government, can feel happy that it has emerged with its head held high over the Electronic Communications Directive, which comes into force this month. "This has been one of our better successes," reflects DMA managing director James Kelly. "There are still one or two pieces of terminology we have an issue with, but our task has been to help our members adjust, and we've ended up with a situation where this legislation is well understood and not arriving with the same level of confusion as the data protection regulations of 2002."
Tackling issues together
Some, if not the vast majority, of the consensus surrounding the directive can be traced back to the merger of the Email Marketing Association with the DMA late in 2002, the effect of which has been noticed this year.
Significantly, both now sing from the same song sheet and agree that opt-in (not opt-out as the DMA originally staunchly protected), is the most commonly agreed principle in direct marketing.
Other notable areas of collaboration include the multi-industry body Code of Practice document, new and fully revised, that came into force in March.
But while some issues have been handled smoothly and with minimum fuss, others have simply refused to go away. The real 'bolt from the blue', as the DMA calls it, came at the Data Conference in March, when the Department of Trade and Industry suddenly announced that businesses should be allowed to add themselves to the Telephone Preference Service (TPS). Ofcom subcontracts the management of the TPS to the DMA - the renewal for which comes up next spring - but the conference announcement caught the industry completely unawares.
"We've led fierce discussions with the government over this," says Kelly. "I've repeatably met with MP Stephen Timms (Secretary of State for Energy, Ecommerce and Postal Services), bringing the full force of DMA troops with me."
The DMA didn't win the battle, but it did secure considerable concessions. The most likely gain is thought to be ensuring that that the person who registers with the TPS has had the proper authority to do so and is not, for example, a disgruntled member of staff.
But it's the complex issue of the environment that has endured throughout 2003 and sees no sign of abating any time soon. The signing of the DMA/Defra Heads of Agreement has now enshrined a level of recycling commitment that must be acknowledged. Any hard-done by complainers should feel lucky that Meacher's plans were averted at the last moment and that this was a considerable concession.
And the DMA responded with perhaps the most significant trade body announcement of the year - the partnership with environmental agency Planet Ark to promote the parallel message of recycling of 'junk mail', with the promotion of the MPS. A major awareness campaign ensued - with Haymarket Business Publications lending its support as media sponsor - backed by Planet Ark co-founder and former Wimbledon tennis champion Pat Cash, as well as singer Dannii Minogue.
A leap in MPS registrations followed (see Marketing Direct, November), but this has settled and the DMA is now hoping that awareness has substantially improved.
The positive spin on 2003 is that while growth in direct marketing has been at its slowest since 1995, the inexorable rise continues.
However, not all have had it so good. The telemarketing sector remains the largest part of the market, but controversy over silent calls and the huge attention of the national press on the growth of offshore call centres has contributed to its woes. This, in the same year that TPS registrations broke the three million barrier for the first time, and which saw the DMA hold its first summit on silent calls in November.
But according to Caroline Worboys, managing director of Broadsystem, all the negative publicity about the future of the call centre industry doesn't give the full story. "We've been distracted this year and not focused on all the advancements being made," she says.
For Worboys, one of the defining moments of 2003 was the company's work with several government agencies that has put integration of phone, email and SMS squarely on the agenda. "For one campaign, our management was entirely of SMS responses. This is brand-new territory for us and something we find hugely exciting."
Excitement is what probably occupies the minds of Business Post, which is no doubt eagerly awaiting the result of Postcomm's deliberations about its access to Royal Mail's postal network - a major story that, accompanied by the Royal Mail's restructuring and financial difficulties, has rumbled on all year long. Sources have indicated that the likely outcome of the pricing structure will see competitors paying a much lower than expected tariff to Royal Mail to access its pipeline.
"It will be cheap enough so that anyone wanting to replicate Royal Mail's existing structure will be discouraged," says one source. If this is the case, Royal Mail should be confident enough to enter next year feeling that it's well and truly on the mend.
Agency-land has been largely unaffected by most of the industry's spats, and among those that have knuckled under, 2003 will be remembered as not a great year, but one in which contracts bedded down.
"We had no reason to feel optimistic about 2003," admits Sez Maxted, managing partner at Draft London. The agency began the year with its merger with Lowe Live, but is now taking new people on and quietly plugging away, winning many medium-sized contracts rather than single large pieces of work.
"We're much more comfortable with this," says Maxted. "There has been a reassessment about what's good business, and for us it's not just about massive one-off accounts anymore."
Alternatives to mail
The sentiment is echoed by Jane Asscher, managing partner and chairman of 23red, although she says Royal Mail's troubles could yet bite back further down the line. "I think clients have definitely thought about how they can move beyond mail as a result of this," says Asscher. "My moment of 2003 was realising the huge success of Freeview television sets. We could be on the cusp of some exciting times ahead in interactive direct response TV."
One problem that hasn't fizzled out as many in the industry hoped it would is the thorny issue of size-based pricing. This is due to come into force next year and is seen by many as penalising campaigns that are more creatively led and don't fit certain size criteria.
It's not something the industry is going to take lying down, so watch out for more fun and games on this front. Other fears for next year include the renewed debate about advertising to children. Coca-Cola and Heinz have just announced that they are pulling out of TV slots watched by the under 12s, and DM could well be affected.
But the broader outlook for the year ahead does seem better than at this point last year. A major initiative by the DMA will launch in 2004 to find out what politicians feel about the direct marketing industry in a bid to get closer to Westminster and Whitehall. 2003 has certainly not been easy, but the signs are there that a better informed industry and a better informed public will make for a much more healthy, robust industry. Roll on 2004.
- Specialist DM agencies are set to lose out after the Royal Mail's roster review states plans to cut back its existing 30-strong roster by partnering with agencies with through-the-line capabilities, slashing marketing spend from £80m to £60m.
- Mintel research reveals that the contract publishing industry's turnover broke the £300m mark last year, while almost doubling in size since 1997.
- The PPA launches the PPA certificate in direct marketing to meet the need for a professional DM qualification tailored to the magazine publishing industry.
- Royal Mail announces plans to team up with digital marketing firm E-Relationship Marketing to offer high-volume email dispatch, tracking and analysis.
- Link 2 launches with a trigger system that uses customer contact data to identify critical events and transactions, which stimulate bespoke offers.
- Environment minister Michael Meacher proposes that all mail should carry information about the Mailing Preference Service, in a bid to reduce waste through better targeting.
- Monthly email spam attacks hit the six million mark, with almost 6.1m unique attacks, according to Brightmail.
- Royal Mail's new wholesale unit comes under attack after postal delivery firm Deya withdraws its licence application, citing barriers to competition.
- The shock of the month is revealed at the DMA's Data Protection Conference, when the Department of Trade and Industry reveals plans to add businesses to the Telephone Preference Service.
- DMA launches its first industry trends survey.
- The end of an era as direct marketing tobacco is finally banned.
- The International Direct Marketing Fair takes place at Earl's Court after two years at ExCel, and attracts more than 10,700 visitors.
- FEDMA study shows that European expenditure on DM has risen to to 46bn euros (£32.3bn).
- BMG Music scraps its European direct marketing function.
- AWA launches full-service agency AWA3D
- The Trading Standards Institute calls for a ban on door-to-door cold calling.
- McDonald's announces it is pulling out of SMS campaigns for the rest of the year.
- The IPA's Bellwether Report shows direct marketing was one of the only sectors to see an increase in spend over the last quarter - up 1.6 per cent.
- New Information Commissioner Richard Thomas says he wants the courts to deal with persistent Data Protection Act abusers.
- ASA bans a mailer from The Worldwide Health Corporation, which suggests readers can take 20 years off their biological age.
- Complaints to the ASA about junk mail were revealed to be down 13 per cent.
- Through-the-line agency RRROAR launches.
- Former DMA president Colin Lloyd takes on the same role at the Institute of Sales Promotion.
- The Institute of Practitioners in Advertising hires David Payne to head a drive for DM agencies.
- Yahoo! runs its first 'Dump the Junk' Day to highlight the problem of spam email.
- Postcomm's 140-page framework for access to the Royal Mail network is published, drawing criticism immediately.
- Starting salaries for DM graduates found to be startlingly low, according to the first DMA/Brand Republic salary survey.
- The first Top 100 mailers report by Marketing Direct reveals spend of nearly £1bn on direct mail. The biggest rises were in the entertainment and retail sectors.
- The DMA reveals that direct marketing expenditure has suffered its slowest year-on-year growth since 1995.
- Defra and the DMA reach a long-awaited compromise on direct mail recycling by signing the joint Heads of Agreement document, proposing tough targets up to 2015.
- The Carlson Relationship Builder 2003 survey shows 87 per cent of respondents believe direct mail frequency is about right, with 90 per cent happy with the tone and style used.
- Carlson Marketing Group acquires CRM agency Peppers and Rogers.
- DMIS reveals that online brands are investing heavily in direct mail, while overall, DM represents 55 per cent of total marketing expenditure.
- Rosemary Smith, ex-managing director of The Prospect Shop, launches list management firm RSA Direct.
- Chris Barraclough quits Proximity to set up DM agency Barraclough Edwards Chamberlain.
- EuroDirect launches shared email data club, Email Exchange, ahead of the EU Electronic Communications Directive.
- Leo Burnett becomes the first ATL agency to commission the IDM and ISP to train its staff on BTL techniques.
- Experian and AZ Direct join forces to offer a range of combined services to help organisations carry out pan-European campaigns.
- Parcelforce Worldwide admits to overpricing error which saw several big mailers penalised.
- Save the Children hands its direct marketing account to Proximity London, following a five-way pitch. The account was formerly held by EHS Brann.
- Below-the-line agency Meercat calls for greater transparency in pitches after it wins an out of court settlement from Vimto. The creative it pitched with was used by the account-winning agency without its permission.
- Behavioural analysis and psychological profiling hit the mainstream after St Ormond Street Children's Hospital and Saga both adopt this technique to profile their prospects.
- Simon Hall announces he will step down as chairman of Proximity Worldwide and Proximity London at the end of the year. Chris Thomas is appointed chief executive.
- Expenditure on direct marketing in the second quarter is up 3.4 per cent year on year.
The industry's first Data Day takes place, combining the Data 2003 conference and the Marketing Direct Intelligence Awards. First Direct scoops the Grand Prix award.
- Swetenhams and the Prospect Shop merge to become Prospect Swetenhams.
- The DMA and Planet Ark launch the biggest consumer campaign yet to promote the recycling of 'junk mail' and the availability of the MPS.
In its first two weeks, as many people join the MPS as normally register in four months.
- MM Group becomes the largest independent contact centre after the purchase of Contact 24.
- Lloyds TSB announces the closure of its 900-strong Newcastle call centre, joining a long list of major companies that have outsourced operations abroad.
- Royal Mail is struck by a spate of unofficial strikes, while Postcomm unveils compensation scheme for business mail users.
- Companies including CACI, Experian and EuroDirect launch new prospecting classifications based on data from the 2001 Census.
- Lack of support forces the DMA to scrap plans to launch a bureaux accreditation scheme.
- Data cleaning and acquisition firm Ebiquita launches 1,200 specially designed information websites to capture details of people who use internet search engines.
- The industry discovers it will have to wait until next year before it finds out what concessions it has won on adding business telephone numbers to the Telephone Preference Service.
- Elvis, a new below-the-line agency, backed by Miles Calcraft Bringingsaw Duffy, launches.
- Proximity London hires Heresy chief Tim Patten as its new managing partner to lead the Royal Mail account.
- The EU's Electronic Communications Directive finally comes into force on 11 December, enshrining 'opt in' in UK law for the first time.
- Winners of the DMA Awards, in association with Royal Mail, are announced.
The Grand Prix award goes to The Depaul Trust for its innovative use of interactive direct response television. Other multiple-Gold winners include Harrison Troughton Wunderman, Craik Jones and Story.