It’s not news that e-commerce is big news for list professionals. Based on avid attention to the subject at the List Vision conference, held at the Hilton New York and Towers Aug. 11, most attendees probably would agree with Direct Media Inc. CEO Dave Florence: “E-commerce is the best thing that’s happening right now,” he said at a panel of list industry gurus. “Four years ago, we hadn’t heard of the Internet. Imagine what it’s going to be like four years from now.”
Musings of this sort are just what Fran Green hoped to hear at the revamped conference. Green, executive vice president of list management and compilation at American List Counsel Inc., Princeton, NJ, chaired List Vision ’99, working with the Direct Marketing Association, which operates the conference. “By changing the name to List Vision [from List Day], we said let’s look at the future,” she said in an interview. “I think that a lot of list veterans were feeling that List Day wasn’t relevant for them anymore.”
The turnout was better than last year’s. An informal tally hovered at around 500 attendees at press time, 100 more than 1998. And there were 50 tabletop exhibits, six more than last year. Some participants noted the limited number of sessions. Restricting the sessions to only seven was deliberate. “We wanted to have fewer, very relevant sessions,” Green said. “We just worked the math. If there’s X-hundred people there, and some are networking and some are in meetings, how many are left to go to the sessions?”
The day began with a blaze as opening session speaker Richard Karlgaard, publisher of Forbes magazine, declared: “I’ve been in business journalism for 12 years and I haven’t seen anything like the last 12 months.” He added, “The skills of direct marketing play very well into where the Internet is taking us.”
Comparing changes wrought by Internet technology with the Industrial Revolution, Karlgaard said, “Computation and communications are unlike other factors that defined earlier industrial revolutions. They are going at infinite speeds for zero costs. In the future, as you write a business plan, think what would you do if communications and computations were infinite and free.”
That’s what online investment company The Motley Fool did in offering free investment analysis that used to cost thousands of dollars from brick-and-mortar companies like Merrill Lynch, he continued.
Prices will never fall to zero, but cheaper costs will lead to e la carte buying and selling. Spot pricing, as done by online airline ticket seller Priceline.com, and auction pricing, done by auction site eBay, will become more the norm, Karlgaard said. And not just on the Net.
With microchip technology, you will put a dollar in a Coke machine on a hot day and “the Coke machine will laugh at you,” he predicted. Karlgaard described a scene in which the microchip in the buyer’s debit card and the one in the Coke machine “dicker back and forth and settle on a price of $1.87. Then you’ll say yes or no. “The value an individual places on a product is widely divergent,” Karlgaard said. “We find that there are people who will pay one, two or three times more if they can just get the product a little earlier than their peers.”
DMers, with their knowledge of one-to-one marketing, are perfectly placed to seize these innovations and make them their own. But, he cautioned, “there are 23-year-olds in Silicon Valley who understand that, too.”
Meanwhile, a session on e-mail drew a standing-room-only crowd. The attendees seemed starved for detailed how-to tips. “People need this basic information,” said attendee Howard Kupfer, senior vice president at list brokerage Mokrynski & Associates, Hackensack, NJ.
Deb Goldstein, president of IDG Communications List Services in Framingham, MA, told the audience that roughly 300 e-mail lists are available today. More are desperately needed, but success stories are occurring as traditional DM lessons are applied to the medium. “When it first started, people forgot about the basics of direct marketing,” Goldstein said. “Now people are doing targeted testing.”
For instance, after Goldstein purchased a CD from Amazon, the bookseller dashed off an e-mail mentioning a new title by the same artist. A link carried her to a site where she could collect a $5 discount on that new title. “It was targeted, short and there was an incentive,” Goldstein said.
Prospecting can also be explosively successful. A National Geographic e-mail campaign captured 25,000 new names in three weeks, recalled panelist Mina Chen, vice president of DSI Marketing, a sister company of Doubleday Direct.
After discovering the best-selling product in the nonprofit’s retail store was holiday cards, Chen, then working for another company, built a campaign around Wild Cards, each of which featured a different wild animal. Visitors to the National Geographic Web site chose from four electronic cards. To send the e-mail card, visitors plugged in their own and their recipient’s e-mail addresses. Soon after, visitors received a confirmation e-mail saying, “We hope you enjoyed sending the card. We will be sending you e-mails from time to time about promotions and National Geographic Events.” It also had opt-out information.
Card recipients received a similar e-mail 24 hours after receiving their Wild Card. The 25,000 total was reached after all pass-along names were collected and merge/purged against the existing database. “They still tout it as their best campaign ever in their 103 years of history,” Chen said in an interview.
Pass-alongs are unique to Internet marketing and their success is offer-dependent. “But when it works well, it works wonders,” Chen commented. “I’ve had campaigns in which 15% of the responses were coming from pass-alongs. Our Doubleday house list was growing 30% every month based on pass-alongs alone. Plus, it’s free.”
Another hot issue was privacy. H. Robert Wientzen, DMA president/CEO, used his luncheon address to stump for the DMA’s mandatory privacy compliance policy. Put into effect July 1, all members are required to sign it. Tossing out a quote heard more than once at the conference – that thousands of privacy bills were introduced in state legislatures last year – he said the association is “working diligently” to prove to legislators that “self-regulation works.” But PR and lobbying are just not enough.
“As for those members who won’t comply, they won’t be members much longer,” said Wientzen. Instead, they’ll be removed by the DMA board by October.
Mentioning a bill the DMA believes the industry could live with, the Deceptive Mail Prevention and Enforcement Act (S-335), he pointed out that it passed the Senate unanimously on Aug. 2. That and other bills in Capitol Hill committees demonstrate that it’s time to tone down the hyperbole and overstatement in sweepstakes mailers. “We have been tested in Washington…it really is up to all of us to earn consumers’ trust,” he said.
Indeed, concerns over privacy may overshadow DMers’ progress in e-commerce and other areas, according to Power Forum panelists Florence; Donn Rappaport, American List Counsel president/CEO; Ben Perez, Millard Group president; and Brian Kurtz, Boardroom vice president of marketing.
If the DMA’s Mail Preference Service worked better, “then mailers should be happy to pay something to clean up the list,” Florence suggested. Nevertheless, with so many bills focusing consumers’ attention on privacy, opt-in for all DM may become the norm.
Lacking legislative restrictions online, marketers using poor Internet privacy practices may harm all of DM. “When the idea is to collect lifestyle information and send a cookie to each name on the list, that practice is going to raise privacy issues,” Rappaport said.
On the topic of mergers and acquisitions, Florence and Rappaport had little to say about their own companies’ recent near-miss of a merger. “One of my major disappointments in my deal with ALC not going through was that the Abacus/ DoubleClick merger presented great opportunities for SmartBase,” Florence said.
If virtual opportunities were the theme of the day, keynote luncheon speaker Millard Fuller brought attendees down to the earthly concern of how DM can be used for good in the world. Founder of publisher Fuller & Dees, which made him a millionaire by age 30, Fuller said he left DM and founded Habitat for Humanity because “I became obsessed with making money, but my life was devoid of meaning.” Now with Jimmy Carter and other celebrities joining the ranks of home builders, Fuller said he’s built 80,000 houses in 1,500 U.S. cities.
Direct marketing has given him the tools to devote his life to improving the world. “Half our income comes from direct marketing,” he said. “The heartland of our support is regular people who send us $10, $20 and $30 at a time.”
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