DMA Advises on Effects of Terror Attacks

The Direct Marketing Association is offering members tips in dealing with the aftermath of the terrorist attacks in New York and Washington.

Michael A. Turner, senior director of strategic information at the DMA, prescribed actions that direct marketing executives should consider when adjusting business strategies in a white paper titled, “DMA Perspective: Economic Impact of the Attack on America on U.S. Direct Marketing.”

— Business executives must provide strong leadership. It is vital that industry leaders reassure employees about the state of their firms and of the economy. Multiple communications providing context for the tragedy are recommended.

— Projections for the quarter and year must be adjusted. Assuming a swift and favorable resolution to the conflict, projections probably will require a modest downward shift. However, if the conflict intensifies over a prolonged period, the magnitude of the adjustment may increase.

— Direct mailers must adjust their schedules. All those using the mail for marketing should immediately reconsider their drop schedule. Even with the sharp drops in response rates, Standard Mail is backlogged, and there will be a postal glut for several weeks until things sort themselves out. Catalogers should consider all September drops as inactive, and firms should pull drops and delay them for several weeks if possible.

— Telemarketers should implement a time-sensitive, geography-based strategy for resuming outbound calls. They should refrain from outbound marketing campaigns until there are clear signals that some semblance of normalcy has returned.

— Catalogers should devise creative inventory reduction plans. While it is too early to determine how much sales will fall in the short term and whether sales will be lower or just slower as a result of the attack, creative campaigns are needed to move excess inventory in case seasonal sales are down.

— Direct marketers should evaluate staffing requirements. Despite the need to embrace and reassure employees in the short run, industry leaders must consider downsizing. Many direct marketers, particularly smaller ones, would be unlikely to survive at the same level should revenue for the quarter drop in response to the events of Sept. 11.

— Companies should aggressively pursue reserve financing. Along with considering short-term furloughs, direct marketers should immediately focus on cash flow. Many smaller and less-well-financed direct marketers were depending on the fall mailings to meet revenue requirements. For various reasons — mailings sitting in bulk-mail distribution centers, consumer indifference after the disaster — projections for this quarter's cash flow are likely to be off.

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