DMA Crisis Reflects Tensions over Royal Mail's New Role

Article excerpt

Sharp internal divisions have surfaced over the representation of the Royal Mail on the DMA board. Neill Denny reports on the row

It's been a bad week for the Direct Marketing Association. After seven years of smooth and uninterrupted growth, it has been hit by a damaging row over the position of a Royal Mail executive serving on its board.

At a meeting of the main board this week, furious mailing-house representatives will try to have Mark Bowler, the Royal Mail's director of media and home shopping, removed. One board member described him as "the enemy within".

It is more than just a row over the position of one individual; it is a dispute over a fundamental conflict of interest that threatens to tear apart the DMA - and with it wreck the consensus that has helped make direct marketing the biggest marketing success story of the decade.

The hub of the issue is that some DMA members, particularly mailing houses, feel that the body cannot negotiate effectively with the Royal Mail on pricing and commission issues while Bowler is on the board. The Royal Mail, granted new commercial freedom by the government, is emerging as more of a competitor than a partner. The worry is that the Royal Mail, unfettered by a regulator, will set up its own mailing houses.

Meanwhile, the Royal Mail, which backs the DMA to the tune of [pounds]150,000 a year, sees no reason why it can't have a man on the board. Particularly as it is a major user of the medium, as well as the media owner. It is a view backed by the new DMA chairman, Judith Donovan, who can see no constitutional reason preventing Royal Mail representation.

Board dispute

Bowler was co-opted to the board in December last year. There were nine candidates for the nine seats reserved for clients, so it went through on the nod. Peter Phillips, chairman of the Mailing Houses & Suppliers Council (MHC), says the appointment passed him by. "If this had been made known to the MHC we would have made our feelings clear," he says.

At an MHC meeting on January 14, a resolution was passed "deploring the situation whereby Royal Mail now have representation on the board, contrary to specific guarantees from Royal Mail in 1992 that this would never be allowed to happen". …