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Direct Marketing and the Economy

Written by: Nancy Arter

Article Overview: This article looks at how the economy is impacting us as direct marketers and the importance of planning for it in 2008.

Direct Marketing and the Economy

This is the time of the year when we all start looking at our revenue performance and begin to set our strategy for 2008. Over the past several months, we've reported some wonderful results for the direct marketing industry on this blog. We've reported how data sales are increasing, direct mail numbers are up, higher results from using e-mail marketing, and so forth. While we've been talking about the strength of our industry, the US Economy has been going through some definite shifts. With the flailing about of the mortgage market and the tightening of credit, some economic analysts consider this the start of a recession, while others state that we are firmly ensconced in one already. Whatever you believe to be the actual case, this bears some looking into as we plan for next year . . . or the next few years.

In the midst of all of this, DM News has reported that Silver Lake and Value Act's acquisition bid of data compiler and database giant, Acxiom, has fallen through. According to Bruce Biegel of Winterberry Group, “This deal was announced back in May, with Silver Lake jumping in with ValueAct Capital, but the credit markets have changed since then. Consider this pricing issue with the fact that Acxiom has a substandard quarter and the risk of a second one doesn’t create a comfort level for investors.”

The article goes on to state that Biegel does remains confident in the potential for growth in the data sector. However, he points out what we already know (at least those of us who have clients within the financial services sector) -- "that the bad credit market is not helpful to Acxiom, many of whose clients are credit card companies and financial services firms suffering from the current economic slump and subprime issues. In addition, he acknowledged challenges to the postal increase earlier this year and the expected increase next year."

However, as you'd expect, Acxiom's retiring CEO, Charles Morgan, remains confident about the strength of his company, and promises to work harder than ever to show value to Acxiom's various stakeholders.

What all of this proves to us is that during the peaks and valleys of our economy, the playing field is strangely leveled. It doesn't matter what size firm you are . . . it seems that everyone is impacted in some way or another.

The other takeaway from this experience is that though you are working hard in the present to assist your clients, you must do so with an eye towards the future. If you can effectively diversify your client base or product offering, you simply have more staying power as the economic factors shift.

Obviously, Acxiom is going to be A-OK -- and then some. They are a giant in the industry and it sounds like they are already planning their next critical steps. As Morgan puts it, “Acxiom has been an industry leader for over three decades. We will continue to execute on our long-term strategy to remain the market leader in database marketing, services and data products.” And, the beauty of the economy is that it tends to be cyclical. Those of us who have been around for awhile remember when this sort of economic pullback happened in the 90s . . . and the 80s . . . and so on.

So, as 2007 enters its final quarter, we advise you to start planning exciting new things for 2008. One of the best places to start your planning is to take a hard look at your overall marketing strategy. We've written some Holiday Tips that may help to spark some good ideas as you begin this planning process. They were written at the end of last year but now is the time to take them out, dust them off, and re-look at them to get some ideas flowing for your 2008 Marketing Strategy. After all, the Annual DMA Conference is right around the corner. By putting these plans into place now, you'll be armed with some great ideas so that you can do some solid research at the conference and come home with your 2008 strategy well on it's way to being completed.

You'll be so far ahead of the game that you'll look like a hero to your CMO. It's like having all of your Holiday

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Article Tags: acxiom, biegel, charles morgan, credit markets, database giant, direct mail, direct marketing, dm news, e mail marketing, economic analysts, economic slump, financial services firms, financial services sector, marketing industry, midst, mortgage market, recession, revenue performance, silver lake, subprime
Referred by: http://www.internet-search-marketing.com



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