New Niche: Wising Up Direct Marketers About Who Just Wants to Be Let

Marketers' obsession with buying and building massive customer data bases has created a seemingly contradictory subspecialty - removing the names of people who prefer not to be on mailing or telemarketing lists.

It has become the law for direct marketers of everything from credit cards to long-distance services to respect consumers' desires to be let alone. But the advent of several companies in the "list suppression" business indicates there is profit in it.

"Honoring a customer's request is just good business," said Dick Gallagher, president of the Signature Group, a company that offers credit card enhancements, has added a service called "Do Not Solicit."

Indeed, businesspeople are coming around to the view that privacy - and the publicity they get from disseminating privacy protection policies - can be a valuable commodity.

"Privacy protection is going to become increasingly a service in America far beyond list suppression," said Alan F. Westin, editor and publisher of the newsletter Privacy and American Business.

A handful of companies, including a list broker working on the World Wide Web of the Internet, are apprising direct marketers of the names of people who don't want to be solicited as sales prospects.

The Signature Group's "Do Not Solicit" list helps companies comply with the Telephone Consumer Act. A rule that the Federal Trade Commission added to that legislation in August requires telemarketers to maintain lists of people who don't want to be called again. The rule went into effect on Sunday.

The Schaumburg, Ill.-based Signature Group claims to be the only company that electronically gathers such information and will compile a list for a client marketer within 48 hours. That could significantly shorten the process of removing names from a mailing list, which the group says averages 45 days in the banking industry.

Consumers get angry if they're called after asking for their names to be struck off marketing lists, said Fanette Singer, a spokeswoman for Signature Group. They want their names removed promptly, she said.

The Direct Marketing Association has been providing a telephone suppression service for its members since 1985. But Patricia Faley, vice president of consumer affairs for the Washington-based trade group, pointed out that its service is not required by law.

About 600,000 consumers are on the association's telemarketing suppression list, and three million are on a mail suppression list that was begun in 1971. Consumers who appear on those lists are not solicited by a variety of marketers; in contrast, the Signature Group provides its service to one client company at a time.

The Signature Group tracks people who are contacted by companies that, for example, sell merchandise to bank customers. As the list provider, the bank is legally responsible for compliance with the telemarketing law, even though it may not be calling its customers directly.

Another service, Buyer's Choice, has tapped into a different type of consumer who is willing to be solicited for products and services but wants to control who does the soliciting.

"People are soon going to say, here are the news, the marketing, and the people I want to reach me, and I don't want anyone else to reach me," said Mr. Westin.

Buyer's Choice, a division of the Polk Co. of Detroit, seems to be responding to Mr. Westin's vision of the future. Polk, a provider of demographic and lifestyle data, sends out consumer surveys asking people to check off categories of products and services that interest them and those that do not.

Half a million people have completed the surveys. Keith Wardell, vice president of Polk, expects the list to reach two million in a year.

Buyers Choice has been gathering consumers' preferences for five years but only recently have the surveys begun probing what kind of mail people don't want to receive. About 20 major mailers, including catalogue companies and travel clubs, are participating in a test of the service, which Mr. Wardell said will be launched formally in the second quarter.

Mr. Wardell estimates that people who complete the surveys will receive about 20 pieces of mail annually from marketers subscribing to Buyer's Choice, while 100 to 200 pieces of mail will be suppressed.

The theory behind the service is that most people want to receive some mail offers. The smallest opt-out category, for example, is women's apparel, and the least popular offer are money market funds.

To keep the list accurate, Buyer's Choice sends out its survey every six months to people who have completed it.

"Part of our intent is to stay in touch with those consumers," said Mr. Wardell.

Aurora, Ohio-based DM Group began compiling a list about four weeks ago of people who don't want to be bothered by unwanted solicitations and advertising, but its communications method is electronic mail.

Robert Hicks, president of the five-year-old company, said he launched the service because DM Group "came under a lot of heat when it came out that we were managing E-mail lists."

DM Group rents lists with about 250,000 names to marketers who want to reach people via E-mail.

But interest in the suppression list has been tepid so far, said Mr. Hicks.

Still, Mr. Westin believes the service is a significant development because it recognizes that "E-mail deserves equal treatment with mail and telephone preference (services), allowing people to opt out."

"I think the DM Group has the right idea," added Mr. Westin. But he suggested that companies put a question "up front" at their Web sites giving surfers the opportunity to opt out of further unsolicited contact.

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