Editorial: Consistency will be key to DM's growth
campaignlive.co.uk, Friday, 22 October 2004 12:00AM
There's a compelling logic to the impending merger of Tequila\London with its TBWA\GGT stablemate. And not just because it ends the anomaly of having a pair of TBWA-owned direct marketing operations in the UK.
Conflict issues seem to have formed a perpetual obstacle in bringing the two together. Now TBWA has resolved that such clashes should no longer get in the way of evolving a consistent DM offering. This may be a timely act. While Tequila has been developed as a global brand, TBWA\GGT has no presence outside Britain.
As the DM sector expands, it is sensible for networks to configure themselves so as to extract maximum advantage.
Direct marketing has been one of the recession's few success stories.
Throughout economic uncertainty, it was only natural for advertisers to direct limited resources into promotions where return on investment could be measured. It was only when the recession was at its deepest that DM spends began to be significantly hit. This year, while the rise in DM spending remains modest, the overall trend remains a relentlessly rising one. This week, the IPA's Bellwether Report revealed that DM budgets had been revised upwards for the fifth successive quarter.
True, the past few months have seen clients creeping back to the more traditional media of TV and the press. What's not clear is whether the return is permanent or has been temporarily fuelled by sporting spectaculars such as the Olympics and the European football championships and by previously deferred product launches.
Moreover, nobody can be sure how long the confidence of advertisers across the world can be sustained. Concerns over weakening of consumer spending have been exacerbated by a faltering US economy, while the threat of an oil crisis is ever-present. As Carolyn Carter, the president of Grey Global Group EMEA, has already pointed out, while traditional media may be on the rebound, the longer term may see it increasingly challenged by more personal and engaging media such as DM.
There could be no better time for TBWA to tidy up its DM stall, particularly because the two shops have found themselves in competition as Tequila moves increasingly into TBWA\GGT's territory. Provided client and personnel issues can be resolved, Tequila's strength in sales promotion should complement TBWA\GGT, which has a strong reputation for strategic and creative work.
However, TBWA must remember a lesson from its past. The 1998 merger of Tequila and Payne Stracey, then TBWA's main UK below-the-line brands, resulted in staff upheaval and a long and confused bedding-down period. That must not be allowed to happen again.
This article was first published on campaignlive.co.uk
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