Tuesday, September 29, 2009

Direct Marketers: Are We Witnessing the Slow Death of The DMA?

Gerry Pike who sits on the board of directors of the Direct Marketing Association (the DMA) sent an angry email to members last Friday titled “S.O.S. re. the DMA.” The email began like this:

If you’re a voting member of the DMA you need to listen to me. Urgently. My name is Gerry Pike. I’ve been a member of the DMA Board of Directors for the past 3 years, and like many of you, active for decades in the DMA ... I’m writing you to ask for your DMA Voting Member Proxy because I’m very worried for our Association. What I have to tell you will worry you, too.

Pike’ goes on to criticize the million-dollar compensation package paid to the association’s CEO, John Greco. He charges that “as membership, revenue, and reserves have plunged, DMA’s management has cloaked its intentions from members and closed off communication." Pike notes that he was “engineered out of” his board position because he worked for change from the inside and he expresses concern that The DMA’s relevancy is fading as "competitors take the lead in a digitally-driven direct marketplace."

Pike’s go-get-'em website, features some fascinating posts gathered over the past year or so, including one by BigFatMarketing blogger Richard H. Levey commenting on the huge staff layoffs that took place at the DMA 11 months ago. “DMA got one last hurrah out of them before letting them go, and in light of this it would be fascinating to go back and review all interviews and speeches president and CEO John A. Greco gave during the conference. Especially those dealing with the health of the industry.” Pike's is hardly a voice in the wildnerness. In April, The NonProfitTimes seriously begrudged Greco a base salary that grabs 2 cents out of every dollar brought in by the DMA.

The day after Pike sent his proxy challenge to members, ex-AT&T executive Greco fired back, saying “The Compensaton Committee of the Board of Directors reviews and approves the president’s compensation with close attention to comparable organizations. The Committee believes the terms of compensation have been appropriate in years when the business was growing rapidly,” but “froze all executive compensation, including that of the president, effective months ago.” Not sure, but sounds like that means Greco's salary was "frozen" at a million?

As a close friend of mine coldly put it in an email: “ICEBERG, RIGHT AHEAD! Are we witnessing the slow-death of The DMA? In 25 years in the DM space I don’t think I’ve ever seen a proxy-challenge like this! I didn’t realize John Greco was making so much damn money. Certainly I gave him enough of mine, but got little in return. He’s tried to make the DMA into a shameless money-machine, but that strategy has backfired. And now that they are hemorrhaging members like me, it’s time to rearrange the deck chairs on the Titanic.”

Personally, I'm opting for a lifeboat, Dan.

--Scrubbed by Marketing Brillo

6 comments:

Isau said...

You said it. Greco 'froze' his salary at a million bucks, while he slashed the organization by half!

And all this has been happening on my membership dues.

It's time for a clean-up, and if Pike is willing to do it, he gets my proxy vote, and I'd ask everyone else to give him theirs as well.

Either that, or the DMA goes down rapidly (look at their revenues & expenses!), and we all lose.

Marketing Brillo said...

Isau...Thanks for confirming the Million Dollar Freeze while Rome burns!

Salvatore Romano said...

Having a DMA membership is like buying a premium yellow pages ad. It's expense greatly exceeds its value.

That's because Greco runs The DMA like the Yellow Pages. Premium services are available at premium prices. What does a member get for their $750 annual fee? They get a jpeg with The DMA logo that they can add to their website. Great.

The DMA is a sinking ship. They've done nothing to ease its membership through the Web 2.0/3.0 paradigm shift.

And its keynote speaker for this year's annual conference is a conviction felon: Martha Stewart.

But as she says, "It's all good!"

Yeah. Right.

Marketing Brillo said...

Good point, Salvatore... In fact, this may be the ONLY point. Some commentators suggest that the size of the salary doesn't matter, but when you combine that with the lack of value you've described -- not to mention opportunity missed in leading the industry -- it's rather completely damning.

aonemarketer said...

I have much to say about Greco's mismanagement of the DMA and I'll add more in the near future. For now, I'll leave you with this. Google the following:

Stanek v Greco

The Yellow Pages Association BOD was smart to fire Greco and I hope and pray that DMA's board takes similar action if the association wants to survive.

Marketing Brillo said...

Holy Stanek Stink, Batman! The Greco abuses have dug an 8-year old stench ditch.. and, according to comments at Folio mag's website last October (http://bit.ly/uwqdr) it's a family affair. Thanks for the heads-up!!!