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Is Award a Tribute or Wake-Up Call?

As Don Peppers and Martha Rogers accept Direct Marketers of the Year honors this week at Direct Marketing Days in New York, many will see the ceremony as marking an industry turning point. After all, the best-selling authors of “The One To One Future” and “Enterprise One To One” have gone a long way toward making DM principles sexy enough to become part of mainstream marketers' aspirations.

But judging from a recent discussion with Peppers, the co-founder of Marketing 1 to 1/Peppers and Rogers Group, Stamford, CT, will say that the age of interactive marketing is less a time to be concerned with direct marketing's stature as it is a time to seriously assess its practices.

From an inevitable Rodney Dangerfield analogy to what he thinks is American marketing's ignorance-is-bliss approach to privacy, Peppers displays obvious respect for direct marketing along with views clearly untarnished by the thought of DMDNY's highest award.

DM News: Does being named direct marketer of the year validate the one-to-one marketing concept?

Don Peppers: That's an unfair question. If I say, 'Yeah, that validates the concept,' I'm minimizing the concept. If I say, 'No, we didn't need the validation,' I'm minimizing direct marketing. Any direct marketer can see that one-to-one marketing has more to do with their discipline than traditional mass marketing. [However] if there's one business that is the Rodney Dangerfield of marketing, it's direct marketing. I think that the reason we were named direct marketers of the year is primarily because we have done a big job educating other business people about customer-oriented marketing and have made direct marketing more mainstream.

DM News: In one-to-one or customized marketing, is there a risk of hurting impulse sales?

DP: I call that the serendipity argument. You go into a grocery store and you didn't know that you wanted beer, but you buy beer. You think that running across the beer was a random event, but the grocery store has configured their store for the average customer. If I'm delivering your groceries [in a one-to-one selling arrangement], I can suggest impulse purchases that other customers just like you tend to make.

DM News: Cendant chairman Walter Forbes said one-to-one marketing goes against human behavior. People still want to go down the aisle for one thing and then buy four. Reaction?

DP: He doesn't understand the concept. Frankly [Cendant] makes a lot of money because their customers aren't informed. It's like AOL [America Online]. A lot of people subscribe and forget about it, and the company continues to collect money. And that's not a customer-friendly business model. Cendant thinks that marketing begins and ends on price and such is not the case. If I remember what a customer wants and make it easier to find it the next time, I can turn him into a loyal customer.

DM News: In any one-to-one marketing discussion, we must talk about privacy. Marketers apparently aren't moving fast enough for government. What's your take?

DP: Privacy is more serious than people think. I don't think privacy has gotten on a lot of radar screens because it doesn't pay immediate dividends, but the European community is putting very onerous restrictions on privacy. There is the example of American Airlines not being able to record in its database that a Swedish passenger was a vegetarian without an explicit agreement from the Swedish passenger. Now, customers are going to get tired repeating themselves. They're going to give permission [to use their personal information, but] companies will secure that information faster if they reassure customers as to uses to which they'll put that information.

DM News: With one-to-one marketing, might consumers think merchants are trying to get to know them too well?

DP: It's a subjective thing. There are little old ladies in trailer parks in the Midwest who like to get junk mail — and I use that term in its pejorative sense: meaningless, stupid mail — because it validates their existence. Whereas, I live in a rich ZIP code, and I get eight or nine, sometimes 15 catalogs every day even though we've never bought anything by mail. To me that's a big annoyance. One important part of any privacy policy should be [some accommodation of individuals' preferences]. I think privacy is a very misunderstood issue in this country. It's going to come back and bite people in a big way.

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