Apocalypse soon, says Libey

The entire face of direct marketing may change over the next five
years. Ready and equal access to the internet is in danger, the
biggest catalogue operators will be taken by private equity
investors, conventional list activity will disappear – and the
entire fulfilment industry could be run from the Far East.

According to the American consultant Don Libey, giving the
keynote speech at the ECMOD event in London at the end of
October, the British direct marketing must prepare itself for
cataclysmic change.

At the most basic level, he said, conventional marketing messages
will change almost immediately, as the use of ‘rich media’
explodes.

“Observe how wired you and your youth already are,”
he told the ECMOD audience. “Video direct marketing is
here, and the future is in movement. Within five years, rich
media will make today’s internet screen look like the original
ping-pong computer game. The emergence of the Metaverse is in
progress. If you’re building an HTML internet site now, you’re
working on old technology.”

The entire concept of ready, free and equal access to the
Internet itself may not have long to last.

“An enormous debate about ‘Net Neutrality’ is already at
major paranoia level in the States, and it will affect
you,” said Libey. “The large providers of telecomms
have realised that the information pipeline is rentable. So, if
you pay more, you’ll get loading priority, and if you don’t, you
load last… at 56K!

“This pay-for-access, pay-for-speed, and pay-for-priority
will become part of your future. In the US our politicians are
already being bought by both sides. But in the UK, you aren’t
even talking about it.”

The big direct marketing companies will get even more powerful,
through venture-capital acquisitions.

“The baby-boomers of the US are just hitting their peaks at
age 60-65, and in the next five or six years, 80 per cent of
their privately-held direct-marketing companies in the US will be
sold, and who will buy them? It will be the private-equity
people, who have more money than heaven, and who have realised
that nothing returns them more than direct-marketing will. And
where do you think these investors are going to look next?
Europe!

“I have also seen intense work by the French and Germans,
massing an attack on the US like we have never seen – the EU
really is going to come to the US. And the US is aiming at Asia.
Brussels and the Netherlands are going to control the world
again! And what are you in the UK going to do – where do you go
when there’s nowhere else to go?”

Traditional list-building work will change, he predicted, taken
over by such new concepts as blogs, and new ideas such as B2B
job-tracking databases, to follow a commercial contact who
changes companies.

“Instead of asking ‘where did my customer go?’, this data
will show you that he has just left company A, and joined company
B. You now say ‘wow, congratulations – want to do some more
business? This can be done, and it will be profitable.

“There will also be a re-definition of ‘lists’. I believe
that for those firms who exist to rent and broker lists, within
the next ten years, half of their income will have to come from
something else. Most list houses are now becoming
consultants.”

The prediction which caused most surprise was Don Libey’s
suggestion that the Far East could handle European fulfilment.

“If we were to teach the Chinese how to be direct
marketers, and how to fulfil one or thirty orders, instead of
container loads, and if we were to teach them about customer
service… what then?

“In the US, we are already rebuilding the entire inventory
model, around the Far East – Dell computer in the States takes my
order, discusses with me how I want that computer built, and
tells me to expect it in three days. They send the specification
to the Far East, where 14,000 computers can be made a day in a
24-hour facility. My computer comes back individually-packed in
the belly of an Airbus, and Fedex delivers it to me.

“So, if the Chinese learn to do direct marketing… what
then?”

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