DMA International Council on 'New Europe' Strategies

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NEW YORK - Almost half of DMA members who sell products or services on the Internet fulfilled international orders last year, mostly in Europe, CEO H. Robert Wientzen told an International Council Day conference here last month.

"Europe's where it's at," Wientzen said in opening the DMA session devoted to "Strategies for the New Europe." European economies, he added, are not suffering the way Latin American and Asian economies have in the past two years.

"Direct marketing opportunities online are better in Europe than anywhere else because, according to our best research, some 40 million Europeans are on the Web."

Worldwide Internet sales are expected to hit $3.2 trillion by 2003, Wientzen added, citing a Forrester Research study.

But he warned that marketers faced major challenges ranging from language and cultural differences to the introduction of the euro early this year.

The inauspicious start of the euro - it has slid from an exchange rate of $1.19 to below $1.04 at press time - has caused surprise and unease, but a common currency is good for DM because it makes marketing simpler.

Equally worrisome, Wientzen noted, were "burdensome regulations" on direct marketing in the EU. He cited continued unresolved differences between the US and the EU over privacy as one problem awaiting resolution.

The DMA's International VP, Charles Prescott, gave an overview of the history of data protection, noting that roots of the current legislation go back to Fascist and Nazi rule in Europe during the thirties.

But the process of developing safeguards shifted emphasis from protecting privacy to guarding data. Governments held that individuals "had the right to determine what will be done with their data," he said.

The result, Prescott noted, was a series of laws and regulations having negative impacts on all business, not just direct marketing.

The EU's data protection directive, which is at the core of the current controversy, will be reviewed in 2001, when its many inadequacies may be rectified, Prescott said. But in the meantime the free flow of data is in doubt.

Bill Whitehurst of IBM gave a detailed picture of what Big Blue is doing to meet the demands of the directive, and the resources the company is applying to do so.

IBM is serious about the privacy issue, down to holding access of the company's European database in Paris at Armonk headquarters as defined in the directive.

Prescott noted that the "elephants" of the industry would make sure to abide by the directive but that the little noted "mice" might not, meaning small companies who figure they can get away with "cheating."

Such leaks will be discovered, Prescott warned, with some "very nasty consequences indeed" for the cheaters.

In order to give US direct marketers a better research foundation for going overseas, Wientzen said the DMA was looking into development of a Wharton Economic Forecasting Model study done on foreign markets.

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