News Analysis: 2005: a year DM took hard medicine

In years to come, direct marketers will no doubt look back on 2005 as a period when some bitter pills were swallowed. Telemarketing was forced to get its house in order, printers suffered from declining mail volumes, while on the plus side agencies benefited from the growth of digital channels.

From telemarketing's perspective, 2005 has been a tougher year than most.

Silent calls have driven consumers onto the Telephone Preference Service (TPS) in record numbers, to the extent that the file hit a record 10 million registrants in September.

From January telemarketing felt the impact of Financial Services Authority (FSA) regulations on selling insurance over the phone. Call scripts must now include certain details, making the calls longer and more expensive.

"The rules were an absolute minefield," says Rachel Robinson, group business development director at MM Teleperformance. "It has meant having stiff and long-winded call scripts. This has effected ROI for clients and outsourced call centre companies."

But it's not all been doom and gloom for telemarketers. The DMA's efforts to improve consumer perceptions of the channel came to fruition in October when Ofcom finally announced its first action against persistent silent calls offenders, a move the DMA endorses.

At the same time Ofcom introduced proposals for higher financial penalties and mandatory caller line identity (CLI), the latter reflecting the existing DMA Code of Practice. "It's taken four years for Ofcom to say, yes, these (the DMA code) are sensible rules," says Charles Ping, DMA chairman. He added that it had been "a long, hard campaign".

For agencies such as Tequila\London, 2005 proved a time when digital work became the fastest growing stream of business. Agencies also found 2005 to be a more level playing field creatively than previous years.

"Agencies such as AIS and Partners Andrews Aldridge have been shouldering much of the creative responsibility in recent years," says Steve Harrison, creative director at Harrison Troughton Wunderman. "But they have now being joined by the likes of Kitcatt Nohr Alexander Shaw, Arc Worldwide and OgilvyOne Worldwide."

Martin Troughton, managing partner of Sharpen Troughton Owens Response, notes that 2005 saw a new phenomenon where "size doesn't matter when choosing an agency". In June agency start-up Stephens Francis Whitson (SFW) scooped the £10 million DM account of financial services provider More Th>n.

There were mixed blessings in the first recorded decline in direct mail volumes for many years. In March the Direct Mail Information Service (DMIS) reported that the financial services sector, one of the most prolific users of direct mail, was cutting back on the channel. Financial services mail volumes fell 8.1 per cent year-on-year, with overall volumes dropping 0.4 per cent year-on-year. Observers welcomed this as good news, diluting as it does the sector's carpet-bombing image.

But mail volume decline has a negative impact, at least for the mail print and production industry. The past two years have seen DM print become a price-squeezed commodity, and the sale of Vertis by its US parent in September was a stark reminder of just how hard life for printers has become.

Action on industry PR

If 2005 started with collective depression about the negative PR of TV programme Brassed Off Britain, it has ended on a more upbeat PR note with the first tangible moves to repair and boost the industry's image. The appointment of TV journalist Alice Beer as the new face of the DMA's consumer campaign has already scored some positive press coverage. It fuels the hope that a happier script is being written for the great UK DM show in 2006.

2005 MILESTONES AT A GLANCE

Jan-Mar05

FSA rules on telephone selling hit telemarketing ... postal competition heats up as UK Mail wins the RBS account ... agencies and suppliers report that the retail downturn is hurting

Apr-Jun 05

Ofcom raps Kitchens Direct for silent calls ... financial direct mail volumes tail off in response to FSA rules on transparency ... start-up Stephens Francis Whitson wins the More Th>n account

July-Sept 05

Telephone Preference Service hits 10 million for the first time ... relief as Royal Mail's Pricing in Proportion plans are delayed until August 2006 ... troubled Vertis UK sold to entrepreneur Mark Scanlon

Oct-Dec 05

Vertis UK is sold on again to printers Howitt ... WWAV Rapp Collins wins Capital One account ... DMA launches its long-awaited DM PR campaign.

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