Branding tornado
Direct Marketing I The downturn has hit the direct marketing industry less hard than most other communication disciplines. Nevertheless, the industry remains only cautiously optimistic.
Direct Marketing I The downturn has hit the dialog sector less hard than most other communication disciplines. Nevertheless, it is only cautiously optimistic, and the potential of the loyalty cards introduced a few years ago by the major distributors Migros and Coop had many a marketing manager in raptures. Thanks to the dialog permission obtained, it was hoped, the DM sector would be able to tap into opportunities it had never dreamed of. However, data protection and the exorbitant costs of efficient data processing thwarted the ambitious CRM goals, and the fact that the DM industry has not become disillusioned is due to the longest recession phase in Swiss advertising history, during which the DM industry was able to grow at the expense of other traditional advertising disciplines. In recent years, social developments such as information overload and the rapid spread of innovative communication technologies have been accompanied by stricter performance reviews and thus an increase in integrated communication concepts with DM as the lead discipline. According to calculations by the German Direct Marketing Association, around half of all advertising campaigns today are DM campaigns. The Swiss Direct Marketing Association (SDV) is no less self-confident. Despite its lower share of commercial communication (2001: 41 %) and a 2.8 percent drop in spending on DM last year, it is still in a better position than the communications industry as a whole (minus 4.5 percent)
.growth market
SDV President and OgilvyOne CEO Guido Wietlisbach cites internal association projections, which assume industry turnover of well over three billion Swiss francs. "In recent years, DM has recorded growth rates that, although no longer as pronounced as in the 1980s and 1990s, are still well above the development of the market as a whole." However, the SDV approximation calculation shows a figure almost three times higher than that of Wemf. Their advertising statistics show a DM share (CHF 1.14 billion), excluding production costs and telephone, e-mail and SMS/MMS marketing, of 21.2 percent of total advertising expenditure. Unlike the SDV, the Wemf only takes into account the DM distribution costs and not the production costs, which until ten years ago were extrapolated on the basis of an average letterbox.
Unperturbed by the dispute over the survey method, the DM sector is shining thanks to larger budgets and the increase in advertising budgets that pursue brand management or sales promotion goals - concepts that were previously withheld from it. Whereas five years ago around ten percent of the Swiss companies surveyed used DM campaigns for image advertising, today the unmistakable DM stamps are increasingly being discovered in image implementations. Whether poster, TV commercial or advertisement: the proportion of those with response elements has risen visibly.
Where does the barometer point? Alex Schmid, co-owner of the dialog agency of the same name, compares mailings with tornadoes in terms of brand building: "DM has generally become strongly associated with image. Top brands in particular - such as computer manufacturer Dell - rely heavily to exclusively on DM. Admittedly
During the recessionary phase, we have observed a shift towards promotional campaigns, which are also expected to fulfill branding objectives." A survey conducted by the German Mercer Group branch among the 270 largest advertising clients also indicates a paradigm shift, concluding that "targeted and personalized communication will be the assets of the future and is likely to push broad-based communication into the background". Whether strategic or tactical DM users, an active dialog has a positive influence on the brand image. This trend can be observed without significant differences in all three German-speaking countries, as a survey conducted by TNS Emnid in spring showed.
According to this study, which the Bielefeld-based market research institute conducted in late summer on behalf of industry associations in Germany, Austria and Switzerland, the market is expected to stagnate or grow slightly this year. According to TNS Emnid, the positive sales trend in the first half of the year does not appear to have been a flash in the pan, as the confident mood has gained a foothold in the industry: More than half of all companies surveyed expected an equally pleasing development in the current semester, adds the SDV. Just six percent feared a decline in sales. "And DM agencies are expecting slight growth in 2004," says Wietlisbach, summarizing the forecasts. Schmid specifies: "DM has benefited relatively during the recession, but has also suffered." Gilbert Fisch, CEO of Switzerland's largest DM agency Fisch Meier Direkt, takes a more differentiated view of the situation: "It may be that the number of DM users is on the rise. As far as I know, agency-related expenditure fell significantly in 2003. Everyone has been hit in this recession."
Opportunities and weaknesses of DMThe DM professionals agree on the weaknesses and opportunities of their industry. Wietlisbach points out that the new media with their low cost thresholds have changed the dialog business, but that the lack of effective regulations has led to uncontrolled growth and sweeping value judgments, which has not exactly helped the industry's image. The quality level is also to blame. Alex Schmid attributes this to shortcomings in our university education system, i.e. where the decision-makers who will later create concepts study. "DM is either non-existent or optional in many marketing courses. That's a big mistake." Leading a value-creating and sustainable dialog with target groups requires a great deal of know-how and an understanding of communication and brands. "Unfortunately, there is still a lack of professional commitment in this demanding communication discipline," Gilbert Fisch also complains. There is often a lack of understanding of dialog as a step-by-step process, which results in amateurish rapid-fire exercises.
Wietlisbach adds: "It is often the case that too little attention is paid to the central idea and its strongest realization. A message is implemented too quickly without dramatization." According to the OgilvyOne CEO, this does not distinguish DM from other forms of communication, in which clients and sometimes creatives are often guided by existing solutions that have been seen many times before. However, as in other disciplines, this is precisely where the shoe pinches in DM: "We would like to see more courage to shape the market again." And this is not a financial issue, Gilbert Fisch is certain: "Ideas cost nothing, only the implementation."
Increasing the efficiency of the advertising franc is often cited as a major challenge for DM. Whether in this context, in addition to
It remains to be seen whether the significant data management will lead to a coupon boom like in the USA or Germany. What is clear is that "couponing is still very underrepresented in Switzerland and is far from exhausted," explains Alex Schmid. Yet our rapidly ageing society in particular offers great potential. In the USA, bargain hunting with coupons is extremely popular with the affluent and growing Gren.
Dialogue marketing with brand expertise: Saatchi & Saatchi realized an integrated image and advertising concept for the "Shopping" exhibition at the Schirn Kunsthalle in Frankfurt, which DM satirized with its own resources and won ADC silver.
Large companies tend to use more addressed mailings, which is also increasingly attracting the attention of SMEs.
Luca Aloisi
.growth market
SDV President and OgilvyOne CEO Guido Wietlisbach cites internal association projections, which assume industry turnover of well over three billion Swiss francs. "In recent years, DM has recorded growth rates that, although no longer as pronounced as in the 1980s and 1990s, are still well above the development of the market as a whole." However, the SDV approximation calculation shows a figure almost three times higher than that of Wemf. Their advertising statistics show a DM share (CHF 1.14 billion), excluding production costs and telephone, e-mail and SMS/MMS marketing, of 21.2 percent of total advertising expenditure. Unlike the SDV, the Wemf only takes into account the DM distribution costs and not the production costs, which until ten years ago were extrapolated on the basis of an average letterbox.
Unperturbed by the dispute over the survey method, the DM sector is shining thanks to larger budgets and the increase in advertising budgets that pursue brand management or sales promotion goals - concepts that were previously withheld from it. Whereas five years ago around ten percent of the Swiss companies surveyed used DM campaigns for image advertising, today the unmistakable DM stamps are increasingly being discovered in image implementations. Whether poster, TV commercial or advertisement: the proportion of those with response elements has risen visibly.
Where does the barometer point? Alex Schmid, co-owner of the dialog agency of the same name, compares mailings with tornadoes in terms of brand building: "DM has generally become strongly associated with image. Top brands in particular - such as computer manufacturer Dell - rely heavily to exclusively on DM. Admittedly
During the recessionary phase, we have observed a shift towards promotional campaigns, which are also expected to fulfill branding objectives." A survey conducted by the German Mercer Group branch among the 270 largest advertising clients also indicates a paradigm shift, concluding that "targeted and personalized communication will be the assets of the future and is likely to push broad-based communication into the background". Whether strategic or tactical DM users, an active dialog has a positive influence on the brand image. This trend can be observed without significant differences in all three German-speaking countries, as a survey conducted by TNS Emnid in spring showed.
According to this study, which the Bielefeld-based market research institute conducted in late summer on behalf of industry associations in Germany, Austria and Switzerland, the market is expected to stagnate or grow slightly this year. According to TNS Emnid, the positive sales trend in the first half of the year does not appear to have been a flash in the pan, as the confident mood has gained a foothold in the industry: More than half of all companies surveyed expected an equally pleasing development in the current semester, adds the SDV. Just six percent feared a decline in sales. "And DM agencies are expecting slight growth in 2004," says Wietlisbach, summarizing the forecasts. Schmid specifies: "DM has benefited relatively during the recession, but has also suffered." Gilbert Fisch, CEO of Switzerland's largest DM agency Fisch Meier Direkt, takes a more differentiated view of the situation: "It may be that the number of DM users is on the rise. As far as I know, agency-related expenditure fell significantly in 2003. Everyone has been hit in this recession."
Opportunities and weaknesses of DMThe DM professionals agree on the weaknesses and opportunities of their industry. Wietlisbach points out that the new media with their low cost thresholds have changed the dialog business, but that the lack of effective regulations has led to uncontrolled growth and sweeping value judgments, which has not exactly helped the industry's image. The quality level is also to blame. Alex Schmid attributes this to shortcomings in our university education system, i.e. where the decision-makers who will later create concepts study. "DM is either non-existent or optional in many marketing courses. That's a big mistake." Leading a value-creating and sustainable dialog with target groups requires a great deal of know-how and an understanding of communication and brands. "Unfortunately, there is still a lack of professional commitment in this demanding communication discipline," Gilbert Fisch also complains. There is often a lack of understanding of dialog as a step-by-step process, which results in amateurish rapid-fire exercises.
Wietlisbach adds: "It is often the case that too little attention is paid to the central idea and its strongest realization. A message is implemented too quickly without dramatization." According to the OgilvyOne CEO, this does not distinguish DM from other forms of communication, in which clients and sometimes creatives are often guided by existing solutions that have been seen many times before. However, as in other disciplines, this is precisely where the shoe pinches in DM: "We would like to see more courage to shape the market again." And this is not a financial issue, Gilbert Fisch is certain: "Ideas cost nothing, only the implementation."
Increasing the efficiency of the advertising franc is often cited as a major challenge for DM. Whether in this context, in addition to
It remains to be seen whether the significant data management will lead to a coupon boom like in the USA or Germany. What is clear is that "couponing is still very underrepresented in Switzerland and is far from exhausted," explains Alex Schmid. Yet our rapidly ageing society in particular offers great potential. In the USA, bargain hunting with coupons is extremely popular with the affluent and growing Gren.
Dialogue marketing with brand expertise: Saatchi & Saatchi realized an integrated image and advertising concept for the "Shopping" exhibition at the Schirn Kunsthalle in Frankfurt, which DM satirized with its own resources and won ADC silver.
Large companies tend to use more addressed mailings, which is also increasingly attracting the attention of SMEs.
Luca Aloisi
