Over there

European trends in direct marketing and customer

management

Rosemary Smith and Jenny Moseley

Macro trends

Last month WPP boss Sir Martin Sorrell said direct marketing and digital could provide one third of the company’s earnings in the next five to ten years. "The two critical strategic opportunities for our clients, media owners and ourselves ... could be glibly described as China and the internet."

Macro trends: Online growth

Macro trends: Online growth

Daily internet users in selected European countries

Proportion who use the internet, the world wide web or email for personal use every day

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

De

nm

ark

No

rwa

y

Sw

ed

en

Sw

itze

rla

nd

Au

str

ia

Fin

lan

d

Be

lgiu

m

Lu

xe

mb

ou

rg

UK

Ge

rma

ny

Sp

ain

Gre

ece

2003 2005

Source: European Social Survey/nVisionBase: 2,000 per country aged 15+

Macro trends: Online growth

UK Online Advertising Expenditure

0

200

400

600

800

1000

1200

1400

1600

2000 2001 2002 2003 2004 2005

Source: AA, DMA Research Centre, 2006£ millions

Macro trends: Changing Mobile v landline balance

China already has more mobile phone users than the entire population of the United States….the number of mobile phone users in China is expected to top 440 million this year. That's a third of the Chinese population.

UK direct marketing expenditure on text messaging

0

500

1000

1500

2000

2500

3000

2001 2002 2003 2004 2005 2006

SMS MMS

Source: Mobile Data Association. DMA Research Centre, 2006

£millions

15%

2%5%9%

5%

4%

2%

13%

2%

2%

5%

6%

9%

23%

Direct Mail

Telemarketing

Database Marketing

Contract Magazines

Door-to-door

Inserts

Press Display (national)

Magazines Display

Regional Display

TV

Radio

Outdoor/Transport

Total New Media

Field Marketing

Source: DMA Research Centre, 2006

Total UK Direct Marketing Expenditure 2005

Macro trends:Postal service developments

EU Letter Post Market revenue 54 million Euros(2004)

Pricing in proportion

Macro trends: major supplier consolidation

Macro trends: Privacy

Changing challenges?

Customer churn Multi channel access “I want it now” customer

requirements New mobile generation Information overload Data savvy/careful consumers

Winning ways? Loyalty programmes to manage churn Multi channel delivery 24/7 customer service via outsourcing Instant messaging to the mobile

jockeys Better analysis and data management

to prevent overload Permission based marketing

Consumer attitudes to email: Europe

Young more positive about interactive communications

0%

5%

10%

15%

20%

25%

30%

Source: DMA (UK) Participation Media 2005Base: 1065 diary respondents

Strongly agree/agree with the statement “I prefer email or online communications to printed information ”

0 10 20 30 40 50 60 70

I usually w ant to try mostnew products and brands

that I hear about

I am happy to give mypersonal information to

companies of w hich I am acustomer

I tend to buy from a limitednumber of brands and

companies

I am never happy to givemy personal information to

companies

%

2004

2005

Consumers careful about brand relationships

Strongly agree/agree with the following statements

Source: DMA (UK) Participation Media 2005Base:1835 in 2005/ 762 in 2004

0%

5%

10%

15%

20%

25%

30%

35%

40%

Male Female 16-24 25-34 35-44 45-54 55-64 65+

Good service means

personal touch

Source: DMA (UK) Participation Media 2005Base:1835

The demand for 24 hour service, by country

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Ita

ly

GB

Ire

lan

d

Sp

ain

Ne

the

rla

nd

s

Fra

nce

Ge

rma

ny

De

nm

ark

Sw

ed

en

Fin

lan

d

No

rwa

y

Po

lan

d

Cze

ch

Re

p

All

Want shops open until later

Want shops open on Sundays

Want out-of-hours customer care

Source: ‘Changing Lives in Europe’, nVisionBase: 1,000 per country aged 15+, 2005

0% 10% 20% 30% 40% 50% 60% 70%

I don't know where to getinformation and help

I don't know whom to trust

It is difficult to findknowledgeable people to

get information from

It is easier to find out frommy friends and family

Source: DMA (UK) Participation Media 2005

Strongly agree/agree with the following statements

2004Base:762 respondents

Word of mouth increasingly important

New Direct Consumer Types? Hectic are the largest group, often too

busy to respond well to communications but most open to companies. Their most positive response is to TV/radio advertising and printed media

Relaxed are the oldest group and also the most reserved about giving out personal information. More likely to respond to companies they already deal with, they respond best to printed media such as door drops and direct mail

New Direct Consumer Types? Healthy/active are the youngest group and also

the most responsive to direct communications. This group responds particularly well to new forms such as emails and mobile messaging.

Mainly women and mature families, Organised are the second most responsive group to direct communications although they are also less trusting of companies.

Balanced consumers are also older/retired but predominantly men. They are particularly responsive to direct mail, door drops and inserts.

0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

Ease of access

Speed of response

Quality of information

Personal touch

Hectic Relaxed Healthy/Active Organised Balanced

Quality of information is equally sought by all, older groups prefer personal touch and speed is crucial for the young

Source: DMA (UK) Participation Media 2005Base:1835 respondents

0% 2% 4% 6% 8% 10% 12% 14%

Local Services – taxis, fast food, window cleaners, etc.

Financial – Investment

Government - central & local

Automotive

Travel/ Leisure

Major retail goods – e.g. furniture and furnishings, DIY,electronic appliances

Utilities

Cable/ Satellite

Other retail l e.g. music, toys and games, books, magazinesand stationary

Home Shopping

Financial- Insurance

Charity

Financial- Personal Loans

Consumable retail – e.g.food/drink, clothing, pharmaceuticalgoods

Financial- Banks and Building Societies

Financial- Credit Cards

Sectors using direct mail

Source: DMA (UK) Participation Media 2005 Base: 1065 diary respondents1243 direct mail recorded

Proportion as percentage of overall volume of all direct mail received

0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20%

Local Services – taxis, fast food, window cleaners, etc.

Government - central & local

Cable/ Satellite

Automotive

Charity

Utilities

Financial- Insurance

Financial – Investment

Financial- Personal Loans

Financial- Banks and Building Societies

Financial- Credit Cards

Major retail goods – e.g. furniture and furnishings, DIY,electronic appliances

Consumable retail – e.g.food/drink, clothing, pharmaceuticalgoods

Travel/ Leisure

Home Shopping

Other retail l e.g. music, toys and games, books, magazinesand stationary

Sectors using email

Source: DMA (UK) Participation Media 2005 Base: 1065 diary respondents320 emails recorded

Proportion as percentage of overall volume of all emails received

0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

Automotive

Financial – Investment

Government - central & local

Financial- Credit Cards

Financial- Personal Loans

Home Shopping

Local Services – taxis, fast food, window cleaners, etc.

Financial- Insurance

Major retail goods – e.g. furniture and furnishings, DIY,electronic appliances

Financial- Banks and Building Societies

Charity

Travel/ Leisure

Utilities

Consumable retail – e.g.food/drink, clothing, pharmaceuticalgoods

Cable/ Satellite

Other retail l e.g. music, toys and games, books, magazines andstationary

Proportion as percentage of overall volume of mobile messages received

Sectors using mobile messaging

Source: DMA (UK) Participation Media 2005 Base: 1065 diary respondents90 mobile messages recorded

Other DM Trends in the UK

Growth in loyalty/relationship management but is it slowing?

Canny Consumers Compare Cards

Other DM Trends in the UK

Segmentation of grey market

50 is the new 65!

Other DM Trends in the UK

Green issues bubbling under

DMA taking tree-emptive action

Other DM Trends in the UK

Universes shrinking because of privacy concerns

UK Electoral Roll Opt-out

0

5

10

15

20

25

30

2003 2004 2005

% Opt-out

DM Trends in the UK

Significant outsourcing

Outsourcing image problems

Quality is key to satisfaction

India Call Centre Staff In Sex Romp Shocker

Anybody who has ever wondered what Indian call centre operatives get up to between harassing angry British Telecom punters about overdue bills and then selling their personal details to the highest bidder may be surprised to learn that they blow any call-free moments indulging in torrid rumpy-pumpy with fellow headset jockeys. According to a revealing report on India Times call centres are slowly becoming hubs where inter-personal bonding takes place. And it comes as little surprise that many also give vent to their sexual urges in the office space.

Source www.theregister.co.uk

India’s loss, South Africa’s gain….

…research by market analyst Datamonitor reveals the number of call centre agents based in Africa will continue to lead global growth through 2010. South Africa remains a dominant and ever-maturing market for contact centre outsourcing services, especially in the area of value-added functions.

Datamonitor June 2006

Questions?Questions?

www.opt-4.co.uk

© 2006, no part is to be reproduced without written permission from the authors