A digest of daily news from DIRECT Newsline

Feb. 26, 2002

Federated Department Stores Inc. reported a fourth quarter net loss of $477 million, compared with net income of $332 million for the same period last year. Federated posted a charge of $770 million, partly attributable to the disposal of its Fingerhut catalog subsidiary.

Nasdaq Stock Market Inc. named RTC Relationship Marketing as its agency of record. RTC is a WPP Group company that specializes in creating customer relationship marketing programs for high-profile brands.

Robert T. Leflar, a high-tech list pioneer, died Feb. 23, a few days after suffering a heart attack. Leflar co-founded Revolution Software's list division in 1992.

Feb. 25

More than one-fourth of all U.S. firms will spend at least $500,000 on customer relationship management technology during the next 24 months, according to a survey by Jupiter Media Metrix. In addition, 23% will spend that sum on content management, and 19% will make similar investments in supply chain management systems.

Howard Flood, a popular figure in the list business, died of cancer Feb. 22. Friends said he was 70. Flood worked at McGraw-Hill for more than 30 years, retiring in 1991. He was the longtime general manager of McGraw-Hill's List Management Center.

Feb. 22

The California State Supreme Court was asked to hear a challenge to a portion of the state's anti-spam law dealing with the labeling of unsolicited commercial e-mail. The plaintiffs contend that the law has usurped the federal government's authority to regulate interstate commerce under the Commerce Clause of the U.S. Constitution. The challenge was filed by two companies — Friendfinder Inc. and Conru Interactive — and by their owner Andrew Conru.

The U.S. Postal Service reported that it was $2.5 million in the red as of Jan. 28. In addition, mail volume fell to 79.8 million pieces between September and January, a 5% decline from the same period the year before.

Feb. 21

The Spiegel Group reported almost $400 million in net losses for 2001, and said it will sell its credit card business. The cataloger attributed the losses to over-aggressive credit marketing and higher delinquency rates.

Business Development Group, Wayzata, MN, signed a non-binding letter of intent to buy Fingerhut Cos. Inc. from Federated Department Stores Inc. Federated described the move as a “preliminary step” toward the purchase of Fingerhut.

Ron Riffkin, one of the last independent list brokers and managers, died Feb. 18 at age 68 after a long illness. Riffkin founded his one-man list firm Riffkin Direct in 1988. At its peak, the company managed properties like the Nora Nelson mail order buyer's file and part of the R.L. Polk database.

Feb. 20

After a decade-long hiatus, Publishers Clearing House plans to put at least four mailing lists on the market this spring and is now in talks with list management companies. The files include magazine buyers, merchandise buyers, sweeps noes and pch.com buyers and entrants. PCH withdrew its lists from the market in response to privacy concerns.

J.C. Penney Co. Inc. will offer its catalog buyers list for rent for the first time. The firm awarded management of the list to Millard Group Inc.

Feb. 19

Stormy L. Dean, chief financial officer of InfoUSA, is campaigning for the Democratic nomination in the Nebraska governor's race. Dean is basing his campaign on the themes of fiscal responsibility and education reform.

Nearly four out of five consumers believe they have lost control over how personal information is collected and used by companies, according to a survey by Harris Interactive. In addition, only 38% feel that existing laws and practices provide a reasonable level of protection. The research was conducted on behalf of Privacy & American Business.

Dimac Marketing Partners will sell MBS, its database services firm, to management and Schooner Capital. MBS was formerly known as MBS/Multimode.

Feb. 15

Sen. Paul Wellstone (D-MN) introduced a bill that would require telecommunications companies to obtain a customer's written consent before sharing their personal data for marketing and other purposes. The measure mandates that consumers opt in to share information with third parties, including a service provider's subsidiaries and affiliates.

Feb. 14

Comcast Corp. halted the collection and storage of some Web browsing data after coming under intense fire. The controversy started when the cable and Internet service company began recording the Web browsing activities of each of its 950,000 subscribers without notifying them.

A 17-year Fingerhut employee and shareholder filed suit against Federated Department Stores Inc. seeking to block plans by Federated to liquidate its catalog subsidiary. The employee, Nick Wesenberg, claimed in his complaint that Federated failed to make a good-faith attempt to sell the catalog business as a whole company.

Feb. 13

An Ohio Congressman called for the appointment of a special presidential commission to study the future of the U.S. Postal Service. In a letter to colleagues, Rep. Steve LaTourette (R-OH) said that good-faith efforts by past congressional bodies were not successful in developing a consensus on meaningful postal reform. Under LaTourette's plan, the Bush administration would have approval over the commission's budget.

Feb. 12

iVillage Inc., which operates Web sites for women, acquired Promotions.com for $9.8 million in cash and $3.5 million in common stock. Promotions.com creates Internet-based promotions and integrates them with offline marketing initiatives.

Primedia Business Magazines & Media, publisher of DIRECT, said it will move its list rental and fulfillment operations to outside vendors. Statlistics will manage the postal lists of more than 90 Primedia Business magazines. Together, they have 4.6 million subscribers. More than 40 employees will be laid off, mostly at Primedia's fulfillment unit in Olathe, KS.

Feb. 11

A Congressional regulatory body opened a probe into irradiated mail after Capitol Hill employees complained about health problems. The Office of Compliance responded to a request by Sen. Charles Grassley (R-IA) to determine if there is a link between health problems and irradiated mail following the cleanup of the anthrax-exposed Hart Senate Office Building.