Looking Back on a Decade of DM Doings

Looking Back on a Decade of DM Doings

BY KATIE MULDOON

In "Out on a Limb", the first part of this two part series, we reviewed how well I had fared with my “big picture” predictions of a decade ago. Although I started out a little shaky, my direct marketing industry forecasts from '94 seem to have held up a lot better. Let's see.

1. Dramatic changes in work force composition: more minorities, more women in power, more entrepreneurs, greater use of technology, more working from home. In their book “Diversity in the Power Elite,” Richard L. Zweigenhaft and G.W. Domhoff conclude that women and minorities have made their way into the power structure. Without a doubt, self-employment, working from home and the use of technology has been growing steadily, all of which create new opportunities for direct marketers. Score: 10.

2. High-technology turnover rates will accelerate. Constant obsolescence means more funds will be invested in technology. Buy a computer today…one month later a newer, better model comes out. Buy some software…the upgrade follows in what seems like days. Score: 10.

3. Communications will rule our lives. Cell phones, anyone? Palms, BlackBerries, laptops, iPods, cameras in phones. The result: even more marketing opportunities. Score: 10.

4. Alternate delivery — a hoped-for augmentation to post office services — will not work except for its saturation capabilities. True. Nobody even talks about this anymore. Score: 10.

5. Due to electronic mail, overnight services and the cost of first class postage, the post office will be totally dependent on advertising mail. Not quite. In 1998, standard A mail accounted for 24.3% of postal revenue and 42.1% of pieces. Last year, standard A rose to 26.8% of revenue and 44.8% of pieces. But it's increased, so… Score: 6.

6. More consumers will use paper catalogs over electronic options. Catalog Age's 2003 e-marketing survey pegged consumer sales from the Web at 27.7% and business-to-business a surprisingly low 14.5%. Score: 10.

7Business-to-business will benefit from electronic catalogs. Despite Catalog Age's findings in prediction No. 6, the computer industry consultancy Giga Information is much more optimistic. It foresees some $5.2 trillion being generated this year from Internet marketplaces, electronic data interchange, hybrid EDI/online trading networks, company-to-company links on the Web, extranets and private e-markets. Score: 8.

8. Most electronic services will not pay out. You remember the dot-com frenzy, right? Do I really need to name names? Score: 10.

9. The list business will cease to be as we know it, as list businesses take on a more consultative role and privacy concerns increase. Yep, privacy worries are up and virtually all list brokers offer consulting services. Score: 10. (This scoring thing is going better than I would have thought!)

10. Alliances will be the name of the game. They've evolved to e-commerce affiliates. The result? A large percentage of online sales. Score: 10.

11. Operations will make or break the catalog business. Catalogers will take higher inventory stances, resulting in more outlet/retail stores for overstocks and international niceties such as computerized language translation and currency conversion. Inventory stances have varied, with some catalog firms taking over 90% first fill and others, due to concerns about a slower economy, being more conservative. Outlet-type stores are another mixed bag; some have closed while others are opening. No doubt, though — multichannel marketing is here to stay. Many Web sites, poised to take advantage of a projected $5 trillion sales volume by 2005, already offer translation aids for language and currency. Score: 10.

12. Payment methods will change dramatically, with the debit card coming into its own and more companies than ever offering proprietary cards. Per MarketResearch.com, “the debit card has grown from accounting for 274 million transactions in 1990 to 8.15 billion transactions in 2002.” Then there are e-checks, which let merchants dip into a buyer's checking account. And let's not ignore PayPal's 7.5 million users. MBNA, an issuer of proprietary credit cards, has 5,100 card choices alone; L.L. Bean and The Sharper Image are just two of the best known. Score: 10.

13. Printers, separators, photographers and computer artists will merge into one computer-savvy entity. All pretty much lumped under “prepress graphics.” Here's how it works: Digital photographers send images to an artist's computer. The artist then prepares the digital content for the printer. Not always a smooth process, but much more so than it was 10 years ago. Score: 7.

14. Loyalty clubs will be a necessity. More than three-quarters of American households now belong to a frequent buyer club, according to data from Rice University's Jesse H. Jones Graduate School of Management in Houston. Yet only one in five companies that responded to a Catalog Age survey in 2003 offered a preferred or frequent buyer program. We need to get with it on this so I can score another 10! But until we meet consumer demand… Score: 7.

15. Due to lower prices, computerization for all. According to an article in The New York Times this past January, despite the dire technology predictions made by some in the late '80s, American semiconductor makers shifted to higher-value microprocessors. Computer companies bought commodity memory chips and other components, from keyboards to disk drives, abroad. And businesses and consumers enjoyed lower prices. Score: 10.

16. Consultants will make the most money. Sadly, not my kind of consultant, but those well-versed in technology. Says the U.S. Department of Labor in its DataMasters salary survey, “In 1998, there were about 429,000 computer support specialists working in the United States. By 2008, the number of jobs is projected to reach 869,000.” So there are more consultants, but what about the money? Well, if you compare a systems manager/tech support person's salary from 1994 to 2003, there's been a 44.3% increase. Score: 8.

So out of a possible 300, what's the score? 234. Now for the next 10 years…