Direct hit after anthrax threat

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Concerned the anthrax scare poses a huge potential threat to the $582.5 billion direct-mail industry, marketers and direct groups are scrambling to address security issues while reassuring rattled consumers.

H&R Block and Kimberly-Clark Corp. are going ahead with scheduled mailings, while Procter & Gamble Co. and Nissan North America are making adjustments to some programs. Coupon mailer Cox Target Media is taking steps to increase the security of its mailings, while Devon Direct spearheads an online industry effort to help consumers verify legitimate direct mailings.

There's much at stake for an industry already reeling from Sept. 11. Since then, the Direct Marketing Association reduced its 2001 projections for total direct-marketing expenditures by $2 billion, predicting $196.8 billion in spending on all forms of direct marketing, down from the $198.8 billion forecasted before the attack.

"It's looking increasingly like we're not going to revise downward further" because of the anthrax issue, said DMA President H. Robert Wientzen. "If, as we expect, this issue dies down in another week or 10 days, it is not likely to have a large impact on mail operations and mail volume."

Nor is it expected to boost e-mail marketing at the expense of paper mail. "This doesn't help anybody, it doesn't help the Internet business," said David Sable, president of WPP Group-owned Young & Rubicam's Wunderman, New York.

Ron Greene, CEO of Devon Direct Euro RSCG, does not believe the issue will be so short-lived, and thinks canceling mail campaigns would be marketers' last line of defense. This week the Berwyn, Pa.-based unit of Havas-owned Euro RSCG Marketing Services will launch an industry-wide, non-proprietary Web site ( so mail recipients can check the legitimacy of packages that cross their desks or land in their home mailboxes.

The Web site, which will be developed and run by Devon staffers, is "about keeping a very vital part of the economy on its feet and moving ahead," said Mr. Greene, who noted that none of Devon's clients, which include Nextel Communications and VeriSign, are altering direct-mail schedules. The site will enable mail recipients to enter a brand name and see a photo and description of the mailing as well as its distribution parameters and postal information.

Nick Vadala, CEO of independent CPS Direct, Woburn, Mass., said one of his agency's retail clients postponed a mailer with no return address-traditionally a tactic that increases the likelihood the prospect will open the package-until CPS can redesign the envelope to feature the company's logo. Mr. Vadala said the retailer-facing the busy holiday season-can't afford to cancel the mailer. "It's been so slow this last quarter that there are folks that have to get out there and start marketing."

Charity groups' direct-mail solicitations could also be in jeopardy. "I'm concerned that between the issues about mail and the fact that America's charitable inclination has been tapped out by the crisis, that charities not involved in the Sept. 11 crisis are going to have a tough time," said Mr. Wientzen, adding that 25% of all charitable giving comes from direct mail.

Mailings that one month ago would have been run-of-the-mill are now causing panic. P&G halted shipments of samples of Always Maxi Pads that raised concerns in Slovakia and the Czech Republic earlier this month, when consumers received lumpy packages without a clearly identified sender. Nissan canceled two weeks ago a push for its new Altima-with 52,000 pieces of a 252,000-drop yet to mail-because the unusual packages spurred about 50 calls from fearful consumers. "We're not going to stop all mailings; we'll just make sure that it's clear to the recipient what's inside," a spokesman said.

The industry is responding to consumer concerns from all sides. Last week the DMA proposed guidelines for mailings ( QuikFIND AAM69L); the United States Postal Service formed a task force for mail security; and the Magazine Publishers Association put out recommendations for secure mailing. "I've already had indications from one large mailer that their mail [response] is off substantially," said Chip Block, vice chairman of subscription-marketing company USAPubs. "They had already felt the impact of Sept. 11...This is a new hit."

Jeremy Koch, senior VP-Time Inc. and head of consumer marketing, said the publisher has no plans to make any immediate changes. "It's the lifeblood of our business. We can't stop sending out mail."

Cox, which mails out 500 million Val-Pak coupon envelopes a year, does not anticipate reducing mailings, although it does plan to spend an extra $50,000 a year for a stronger sealant to further reduce the threat of tampering. Kimberly-Clark also plans no changes. And H&R Block will go ahead with its annual tax-season acquisition effort that begins in early 2002, which includes a big direct-mail push via Interpublic Group of Cos.' Campbell-Mithun, Minneapolis. The mail component primarily consists of self-mailers-open cards without sealed sides.

Contributing: Mercedes M. Cardona, Tobi Elkin, Jon Fine and Jack Neff

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