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Direct Marketing Commission - Enforcing Higher Industry Standards

DMC Quarterly Newsletter

30th April, 2009 at 12:07pm

Foreword from the Chairman Matti Alderson:
“Welcome to the first newsletter from the Direct Marketing Commission. Since we launched in September last year we have been extremely encouraged by the very high levels of compliance exhibited by the industry.
The emergence of a global recession has meant slashed marketing budgets and has put pressure on everyone involved in the industry, which could have led to a loosening of standards. However, in spite of this, our statistics have shown that the majority of companies are keen to provide a high quality of service to their customers.

At the Commission we are aware of the importance of being at the forefront of new issues facing the industry, and so we have set up a Joint Policy Forum with the Direct Marketing Association, which enables us to work together to encourage direct marketers to adhere to the high standards and best practice that our industry requires.

It is an exciting time for the industry and the Commission, and I would like to take this opportunity to thank all of the exceptional people involved in making the vision of the DMC a reality and working so diligently towards its continued growth.”

Recent News
• Danny Meadows-Klue, founder of Internet Advertising Bureau (IAB) has been appointed as a commissioner to strengthen DMC’s expertise in regulating online advertising, email, social media and emerging digital platforms
• The DMC’s inaugural Quarterly Complaints Index has been released. The results highlight an exceptionally high level of compliance in the industry
• The DMA expels its first member for two years after it failed to comply with its code of practice. The telemarketing agency is the first member to be excluded from its membership following recommendation by the DMC

Complaints trends
Of the 107 complaints received by the DMC in this period, 94 were investigated and resolved informally without the need for any formal action. These complaints concerned only minor breaches of the DM Code of Practice – issues that are not regularly reported against one specific company or do not affect large numbers of consumers – where the companies involved demonstrated their willingness to take expedient remedial action.

Key findings include:
• The industry practice most frequently subject to complaint came under the heading of customer ‘account issues’.
• The second most common area of complaint (9%) fell under the heading of ‘unwanted emails’
• Only four complaints were received – all of which were resolved informally – relating to instances of ‘silent calls’

Interview: Danny Meadows-Klue, Commissioner
When you were asked to join the DMC, what was the biggest pull factor?
“Back in the late 90s I realised the importance of self regulation, working with the CAP and the Advertising Association on early self regulatory frameworks. As the DM industry matures, self regulation becomes even more important, especially with the shift to the web from the high street, the scale of trading and marketing is shifting to become the dominant sales channel. As an industry, if we don’t get our practices right then government will be forced to step in: trying to make up our shortfalls with legislative frameworks that are likely to be at best, restrictive and most likely inappropriate and quickly outdated”

Is digital DM still something of a Wild Wild West?
It can be. Digital marketing can be fantastically empowering for consumers and incredibly efficient for brands. But there’s a big bridge to cross between the theory of what’s possible and actually getting it right. Many companies under-invest in digital marketing skills or the operational resources needed to get things right, and that’s where mistakes are made.

Many firms stumble because they lack the insights of best practice, others are operationally under-resourced for online marketing. And in spite of ecommerce being 15 years old, most firms have a way to go before getting it quite right. Yet for those who do (and for their customers) the rewards are great.

The results from the latest QCI (Quarterly Complaints Index) have indicated a high level of compliance in the industry, do you think that the recession might threaten this as companies realise consumers are more vulnerable in some ways?
It’s going to be a tough 18 months for the marketing industry, and particularly challenging for client side marketers who are pressured by greater accountability and smaller budgets. Consumers have less money to spend and they’re looking for wiser ways to spend it – and that means looking to the web.

Search engine marketing will continue to take half all web advertising spend and benefit even more as marketers gravitate to its accountability. As for the value of email and website building, this will continue to swell, but the lack of data means spend can’t even be quantified.

What’s your message to marketers?
Getting self-regulation right means all of us working together. The DMC – and the rest of the self-regulatory network – needs your active engagement, enthusiastic compliance, and explicit support. If industry doesn’t get this right, it doesn’t get a second chance.

Complaints case study:
Mrs Smith received a telemarketing call from a mail order shopping company during the winter of 2007. Her son was only 3 months old and the salesman was trying to sell her some educational books.
Even after Mrs Smith repeatedly refused to buy anything, the salesman kept trying to hard-sell. Mrs Smith claimed that the salesperson tricked her to believe that the books were free even after she said no, but her son was crying for attention and she had to end the call abruptly.

She then received a letter from the company in question for payment of about £6, even though Mrs Smith claims that no account was opened. She then received several letters with £5 added every time for late payment. Recently she received a letter from a debt collection company. Her husband contacted the debt collectors but they were not helpful. Mrs Smith then rang the company who had sent the goods and they said they would respond on the same day, which never happened.
The company offered their sincere apologies. They listened to a recording of the call and agreed that the sales representative was too pushy. They are currently overhauling their Customer Service in terms of standard letters and marketing material. They are also reviewing the matter in which they handle cases, such as her own. They have now cleared and cancelled her account and notified the debt collection agency to cease contact. They also sent Mrs Smith a £30 cheque as a gesture of goodwill to compensate.

The Direct Marketing Commission issued a reminder of the company’s obligations under the Direct Marketing Code of Practice to provide prompt, efficient and courteous customer service and to ensure members must avoid the use of high-pressure tactics that could be construed as harassment.

© DMC 2009. Copyright is held by the DMC. This document should not be copied in whole, or in part, without the express permission of the DMC.

Direct Marketing Commission Ltd.  Registration Number 6469055.  Registered Office:  DMA House, 70 Margaret Street, London W1W 8SS.

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