Foreign DMers face familiar obstacles

Communication, data protection, data access and government regulation are major issues confronting foreign direct marketers just as they are for DMers in the United States.

Participants of DM News’ International Roundtable, held at DMA•06 in October, discussed direct marketing issues in their nations, obstacles facing U.S. marketers in their nations and DM’s future.

“The three major direct marketing issues in [Europe] are, firstly, the communications issue, [such as] how do you get the right information to consumers,” said Alastair Tempest, director general of the Federation of European Direct and Interactive Marketing in Brussels, Belgium.

“Secondly, data protection is always a problem,” he said, “and thirdly, protectionism is growing in Europe again, so you get problems cross border because of differences in interpretation of legislation.”

Other participants included:

• Rob Edwards, CEO of the Australian Direct Marketing Association in Sydney.

• Attila Vamos-Hegyi, vice president of the Hungarian DMA in Budapest.

• Freddy Rosales, vice president of marketing services agency di Paola & Associados/WPP in Buenos Aires and representing the Argentine Direct and Interactive Marketing Association.

• Rajat Sethi, CEO/director of Wunderman India Ltd., a Y&R Worldwide company in New Delhi, representing the India DMA.

The panel was moderated by this DM News writer and attended by Charles Prescott, vice president of global knowledge network services for the U.S. Direct Marketing Association.

Mr. Edwards said Australians also see public information becoming increasingly inaccessible for organizations that want to build prospect lists using public data.

“There is also an issue around government intervention because consumers are getting overloaded in the amount of marketing messages they receive,” he said. “They complain to their legislators, and the legislators are trying to do something about it. We’ve seen it with telemarketing.”

Australia has strict do-not-call legislation, he said.

Contacting people in Argentina also might become difficult, as a new law in Buenos Aires requires telemarketers to consult a DNC list, Mr. Rosales said.

“It’s the first province in the country to do so,” he said. “I hope it will not be enforced in literal terms, at least until we [meet with] the government [and ensure they have] proper consideration of marketing interest.”

But marketers have many new media opportunities to reach the Argentinean population. Argentina is the third-largest country in the world in terms of cable TV penetration, Mr. Rosales said, and one of the fastest growing in terms of cellular phone penetration, at nearly 65 percent.

Mobile penetration is extremely high in Europe and growing, particularly in Portugal, Mr. Tempest said.

However, strict opt-in rules govern marketing via cell phone in Europe, he said.

Meanwhile, mobile phone adoption is soaring in India.

“Mobile [offers] a huge opportunity,” Mr. Sethi said. “We have 120 million mobile subscribers in India, which is still only a little more than 10 percent of the potential penetration in India. And I do believe that new and innovative media is going to play an increasingly important role in terms of direct marketing.”

However, many Indian consumers are getting spam e-mails on their cell phones, which is becoming a big problem, he said.

“We don’t have any regulation [around this] right now, so now is the time for marketers to get together and do some self-regulation instead of waiting for the government to come in and pull some sanctions,” he said.

India has its share of communication problems as well, given the diversity of its population.

“How do you market to a population of 1 billion, with 16 languages and 1,652 dialects?” Mr. Sethi said. “It is a communication nightmare.”

India’s booming economy has spurred a “focus on acquisition, and I do believe there is a negligent focus on retention, and that is an opportunity for direct marketers,” he said.

Hungary also offers a growth opportunity, because e-mail direct marketing is still not used regularly, Mr. Vamos-Hegyi said.

“Ad agencies and direct marketers have no interest in using the existing state-of-the-art technology because they have much bigger revenue from ordinary addressed and unaddressed direct mail,” he said. “The electronic media is very cheap but very effective…but because it is cheap, there is no interest there. If someone has a good strategy and creativity, however, he can enter into the market and grow pretty fast.”

Though Internet penetration is low in Hungary at 27 percent of the population, broadband penetration among users is high. Also, mobile is used by 95 percent of the population.

Whether U.S.-based marketers are reaching out to these countries depends on the nation in question, and the type of marketing they do, according to all participants. In Australia, for example, U.S. catalogers are not biting.

“We only have 20 million people, and because of our climate, we don’t have a great history in catalogs,” Mr. Edwards said. “In a lot of ways it’s like southern California, where people are used to getting in their cars and driving to stores.”

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