DMA’s b-to-b mission expands

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In an effort to extend its reach to small and midsize agencies, the Direct Marketing Association bought the Association of Direct Marketing Agencies in January. The deal, terms of which were not disclosed, is the latest in a string of acquisitions by the New York-based trade group.

The DMA also announced the hiring of David Smith, formerly chief marketing officer at database marketer Prefer Network, for the new position of VP-business and strategic development. Smith’s initial charge is to build services for the DMA’s b-to-b members, which include IBM Corp., DoubleClick Inc. and Acxiom Corp.

The ADMA, which has no full-time employees, is being folded into the DMA. Its acquisition adds about 25 new members to the DMA’s 5,000-person strong membership list. While the number of new members is small, their type is important to the DMA, which is trying to broaden its appeal and clout.

On a buying spree
The Direct Marketing Association has made several key deals in recent years to bolster its ranks and services. Acquisitions include:
• Association for Interactive Media, October 1998. The deal gave the DMA greater depth in what was then a nascent realm, e-commerce.
• Merch.Net, October 1998. This buy strengthened the DMA’s e-commerce solutions membership base.
• Addressable Advertising Coalition, October 1998. This acquisition gave the DMA more access to cable and broadcast TV companies.
• Internet Alliance, May 1999. This deal built the DMA’s business-to-consumer Web expertise.
• National Federation of Nonprofits, June 2000. The nonprofit segment does a good deal of direct marketing and the buy gave the DMA entrée into this sector.
• Brazilian Institute for Database Marketing, October 2000. The DMA’s international know-how was considerably strengthened through this acquisition.

Small to midsize direct marketing agencies that felt neglected by the DMA left the organization and established the ADMA in 1970. Since then, the DMA, while still focusing on big agencies and Fortune 500 companies, has earned a reputation as being responsive to smaller members’ needs.

H. Robert Wientzen, president-CEO, said the new members bring a good deal of creative innovation to the DMA. "There are boutique agencies that do a lot of great work,” he said. "This will allow our big marketers to be exposed to local agencies." Among the new members are Database Marketing Associates Inc., Scottsdale, Ariz., and Huntsinger & Jeffer, Richmond, Va.

The DMA’s acquisition is also a nod to the slowing economy. In a time when some of its members’ earnings are falling short of expectations—-a trend that could lead to cost-cutting moves such as dropping memberships in trade organizations—-the DMA is trying to build up membership as a preemptive strike.

Developing new services

The arrival of Smith should provide a boost to the DMA’s b-to-b members. His hiring is further evidence of the DMA’s increased effort to cater to its b-to-b members.

During the early to mid-1990s, the New York-based organization was criticized for its lack of b-to-b focus. Since Wientzen took over in 1996, however, it has dramatically increased its spotlight on the segment, which today accounts for more direct marketing volume than the business-to-consumer sector.

Smith is an 18-year direct marketing veteran with experience working with both Fortune 500 companies and start-ups. Among Smith’s first tasks will be working with the DMA’s b-to-b segment advisory committee to come up with new, useful services for members.

Citing his newness to the job, Smith declined to provide any specific goals. "My role is to initially seek feedback from top industry pros," he said. "My goal right now is to be a good listener."

Smith comes to the DMA at a challenging time as the industry deals with privacy and Internet taxation issues. While these complex matters often fly under the radar of creative direct marketing types, they will no doubt have more of an impact on how DMA members do business 10 years from now than technology itself, making the organization’s leadership crucial.

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