DMA Members Report Revenue, Billings Below Projections

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SAN FRANCISCO -- Direct marketers reported that revenue and billings through the third quarter of 2002 were below their start-of-year projections, according to the Direct Marketing Association's Fall 2002 Quarterly Business Review survey of DMA members.

Results were released at the DMA's 85th Annual Conference & Exhibition here.

In the survey, 60 percent of members reported a significantly or somewhat worse third quarter. And 19 percent of direct marketing users said their third quarter was "significantly worse" than they had projected. Meanwhile, 17 percent said their projections were on target while 23 percent reported a better-than-expected quarter.

"As we all know, this was a tough quarter not just for direct marketers, but businesses in general," said H. Robert Wientzen, DMA president/CEO. "Members no doubt anticipated a strong rebound from the recession of 2001 and the events of September 11. The predicted economy-wide recovery has to date generally failed to materialize, leaving direct marketers now more focused than ever on new customer retention and acquisition strategies."

DMA members reported that in the fourth quarter they planned to spend more on e-mail (48 percent), followed by new customer prospecting (40 percent), new product development (35 percent), e-commerce (32 percent), database segmenting (29 percent) and customer services (21 percent). DMers indicated that direct mail, teleservices and customer relationship management will remain stagnant or decline in quarter four.

Expenditure projections among direct response advertising agencies and suppliers showed that both groups anticipate the highest growth in spending in the same customer-focused areas: customer acquisition, customer service and new development. Fourth-quarter 2002 spending for agencies and suppliers will remain unchanged or decrease from current levels in the operations areas including personnel, mergers and acquisitions, and operating capital budgets.

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