Press coverage and public perception of direct marketing and consumer privacy

JOSEPH PHELPS WlLLlANl GONZENBACH EDWARD JOHNSON

Press Coverage and Public Perception of Direct Marketing and Consumer Privacy JOSEPH E PHELPS i s an assistant professor in the Advertising and Public Relations Department at the University of Alabama His research interests include consumer perceptions of direct marketing and privacy issues. and examining the integrated marketing communications phenomenon and irs implications in current marketing pracrices. theory, and research. Phelps earned his MA and PhD in mass communication from the University of Wisconsin at Madison. and a BA in communication from Saint Norbert College. WILLIAM J. GONZENBACH, PhD. i s an assistant professor of advertising and public relations, and associate director for applied research of the Institute for Communication Re- search, College of Communication, University of Alabama. His research interests center on the dynamics of public opinion processes, and the relationship of PR and advertising to opinion formation. He has published in national and international journals on public opinion formation. and serves as codirector of the Alabama Poll and as a research consultant for numerous corporations. EDWARD A JOHNSON is a doctoral student at the College of Communica- tion, University of Alabama. He worked as a direct marketing and advertising practitioner for 10 years in Grand Rap- ids. Michigan He also taught advertising for two years at Central Missouri State University His research interests rn- clude consumer response tQ graphic elements in promotion materials. Johnson received his MA from Wheaton Grad- uate School and his BPA from Brooks Institute of Photography

JOSEPH PHELPS WILLIAM GONZENBACH EDWARD JOHNSON

0 1994 John Wiley & Sons, Inc. and Direct Marketing Educational Foundation, Inc CCC 0892-0591/94/0209-14

JOURNAL OF DIRECT MARKETING VOLUME 8 NUMBER 2 SPRING 1994 9

ABSTRACT This study begins to fi l l a void in the literature by addressing three important but as yet unanswered questions. First, how much have the media covered the consumer privacy issue and how have they focused their coverage of this issue? The research reported here examines five leading newspapers’ coverage of privacy issues relating to direct marketing, from 1984 through 1992. Second, how salient is the privacy issue to the public and has that salience increased over time? The study examines available public opinion. over time, about the issue. And third, is there any evidence to suggest that media salience of the issue is leading to public salience of the issue? The findings suggest that public concern was high even before the increases in media coverage in the mid- 1980s. and that t he dramatic increases in frequency of coverage have little relationship to public salience. Future research should examine the role of real-world cue measures-such as the frequency of telemarketing calls and direct mail pieces. Finally, this study indicates that the direct marketing management can influence the content of press coverage through a combination of industry action to reduce consumer privacy concerns and promotion of these initiatives.

INTRODUCTION

Overview Consumer privacy issues get a great deal of attention from the direct marketing industry, public policy makers, consumer groups, and the press. Surpris- ingly, no academic research has investigated the press coverage of these issues. This lack of research leaves important questions unanswered. For ex-

the importance of consumer privacy issues to direct marketers is discussed. Second, several industry initiatives developed to reduce consumer privacy concerns are outlined. Third, direct marketers’ perceptions of press coverage of privacy issues and the importance the industry attaches to this press coverage are discussed. Once this background is in place, the study, its findings, its contribution to direct marketers and the research literature, and sug- gestions for future research are presented.

Importance of Consumer Prlvacy Issues to Direct Marketers From an industry perspective, successfully dealing with consumer privacy issues is crucial. A prominent industry trade association, the Direct Marketing As- sociation, has named consumer concern over privacy as the most important issue facing direct marketers today. The DMA’s view is further endorsed by a number of industry and academic leaders who have identified consumer privacy concerns as issues that threaten the very foundations of direct, as well as of highly targeted marketing (32). These threats to direct marketing are most apparent in the form of regulatory legislation. In 1992 more than 1,000 bills on privacy issues were presented in state leg- islatures, and at least 10 bills were introduced at the federal level (24). According to the 1992 DMA Report on Privacy, included in this legislation are bills that would have the following effects:

ample, how much coverage does the press give to consumer privacy issues? Is the direct marketing

Does this coverage influence consumer perceptions of direct marketing and privacy? This study attempts to answer these questions. I t examines press cov-

Prohibit contacting consumers without their prior express consent; prospecting would become illegal; list rental and list exchange would cease to exist or

prohibitive; and loss of access to consumer files such as DMV lists that would mean no information or list sources for mailing, screening, or analysis. (8:2)

industry portrayed in a positive Or negative light? be subjected to large surcharges that will make thern

erage of consumer privacy issues relating to direct marketing in an effort to understand the influence press coverage has on public opinion regarding privacy issues. Understanding the factors which influence public opinion is essential for all direct marketers, because business survival and growth de- pend directly on maintaining consumer confidence in direct marketing practices.

Before presenting the study it is necessary to set the stage by examining briefly three issues. First,

These legislative attempts originate from consumer/voter concerns. Indeed, results from numerous public opinion polls indicate consumers are highly concerned about what companies know about them, how companies obtain that information, and what companies do with the information they collect (27). Seventy-eight percent of the respon- dents in a 1991 Gallup survey described themselves as “very” or “somewhat” concerned about what marketers know about them (16), while 69 percent of the remondents in a 1991 Time-CNN survev said

This paper won a cash award of $1 thousand for excellence at the DMEF’s Fifth Annual Roben B. Clarke Educators’ Conference at Toronto last Oc- they were concerned about the of tober. where it also was presented. information collected by companies that market

10 JOURNAL OF DIRECT MARKETING VOLUME 8 NUMBER 2 SPRING 1994

products (20). In addition, the 1992 Harris-Equifax Consumer Privacy Survey found that 76 percent of the public believed consumers “have lost all control over how personal information about them is used by companies” (14) . Earlier Harris-Equifax surveys (1990, 1991) had reported that 71 percent of the public felt this way, indicating that consumer concern over privacy issues relating to direct marketing may be increasing; however, given the sampling er- ror for this question in each survey (approximately 3%), one cannot say definitively that concern is increasing (12,13). Still, other work indicates that consumer concern over privacy increased in the 1970s and ’80s. Not only had the percentage of Americans “very concerned” about privacy increased from 30 percent in 1978 to 45 percent in 1989 (18), the percentage appears even higher when i t comes to marketing practices (12-14,27); however, this concern may have reached a plateau in the 1990s. These concerns have not gone un- noticed by the industry.

Examples of Industry Initiatives to Reduce Consumer Privacy Concerns Although there are multiple facets to consumer privacy concerns, the two that appear most important are the reception of uninvited advertising messages (seen as intrusion by some consumers) and concerns over direct marketers’ gathering and use of consumer information. Direct marketers, individually and through their trade associations, have developed a number of initiatives to reduce these consumer concerns. For instance, the DMA has developed the Mail Preference Service (MPS) and the Telephone Preference Service (TPS) which allow consumers to “opt-off’ of mail and telephone lists. Many individual direct marketers also offer their customers the option to have their names removed from lists that are rented to other marketers. These, as well as other initiatives, help reduce the amount of uninvited advertising messages, with the goal of reducing consumer concerns over intrusion by al- lowing them some control over the advertising messages they receive. The DMA has also estab- lished a checklist of fair information practices that outline procedures for the gathering, protection, and use of consumer information. With initiatives such as these the industry is responding to consumer concerns over the gathering and use of consumer information.

Obviously, simply instituting these industry actions will not reduce consumer concern. Consumers must be informed about industry initiatives if concern is to be reduced. How has the direct marketing industry attempted to build this consumer awareness? One outlet for such information has been the press. (Press coverage of two industry initiatives is discussed in the Results section.) However, as will be discussed in the next section, although direct marketers understand the importance of the press to building consumer awareness, many perceive the press as a negative force which has only served to heighten consumer privacy concerns.

Direct Marketers’ Perception of Press Coverage Regarding Privacy Issues The importance direct marketers attach to press coverage is perhaps best illustrated by the efforts of the DMA to gain positive coverage and educate their members on how to deal effectively with the press. For example, a DMA pamphlet, Grass Roots Advo- cacy Guide for Direct Marketers, offers advice on how to get positive press for your company and for direct marketing. I t also suggests answers to often asked questions. Clearly, this effort indicates that direct marketers feel that what is written about them and their industry in the press has important consequences. It is also clear that many direct marketers feel that the press unfairly criticizes their companies and industry. Of the many factors that contribute to consumer privacy concerns (27), several industry leaders suggest that news coverage is one of the major factors. For instance, Steve Cone, chairman of Epsilon, made the following comments about newspaper coverage of privacy issues:

It’s a manufactured issue conjured up by the press to sell more papers. The press never focuses on the other side of the issue, which is that the vast majority of consumers want the convenience that direct marketing offers and that companies go out of their way to protect the integrity of the data. (24:14-15)

Vincent Giuliano, vice-president for government relations at ADVO-System Inc., in his testimony before a congressional committee, suggested that the media coverage not only was a contributory factor but was the most important factor. He said the newspaper industry’s “need to compete” with direct marketers has “resulted in intensified attacks . . . on the advertising mail industry.” “Those attacks,”


he added, have exacerbated “the public’s concern over a potential invasion of privacy resulting from the compilation and use of mailing lists” (1).

In summary, reducing consumer privacy concerns is crucial for direct marketers. Only by alle- viating these concerns can direct marketers maintain the consumer confidence necessary for growth and avoid restrictive legislation. Although individual direct marketers and industry trade associations have taken actions designed to reduce consumer privacy concerns, the consumers must be made aware of these actions. The main outlet for informing the consumer about these initiatives is the press; however, many direct marketers feel the press accen- tuates the negative and actually serve to increase consumer privacy concerns. Given this situation, research is needed that examines how direct marketers have been portrayed in the press and whether or not this press coverage has influenced public opinion on privacy issues.

PURPOSE OF STUDY

While Cone’s and Giuliano’s earlier statements re- flect the negative sentiments of many direct marketers who feel that the press acts to increase consumer privacy concerns, other direct marketers are actively working to get positive press coverage. These statements and actions indicate a belief that the press influences public opinion. Given the power the press is assumed to have by the parties involved here, information on what the press has actually written about consumer privacy and direct marketing is needed to clarify how the industry has been portrayed by the press, and whether or not this portrayal has influenced consumer privacy concerns. Unfortunately, no one has made an in-depth examination of the content and tone of the press coverage of consumer privacy issues relating to direct marketing. The lack of academic research that details the media coverage of consumer privacy issues is surprising in light of the parties’ assumption of strong media effects.

If , for a moment, one views public opinion as consumer confidence and concerns with direct marketing, then the contributions of this study for direct marketers become readily apparent. Jonah Gitlitz, DMA President and CEO, said, “direct marketers can only sustain business growth if consum-

ers maintain confidence in direct marketing practices, and only if lawmakers understand the benign nature and economic benefit of using information about consumers for commercial purposes.” Thus, understanding what factors influence consumer perceptions of the industry is essential for all direct marketers. Many practitioners assume that the press plays an influential role in building/reducing consumer confidence. This study provides an initial test of that assumption by investigating press reports regarding direct marketing and consumer privacy, and by examining the relationship between press coverage and public opinion relating to privacy issues.

More specifically, this study addresses three major questions. First, how much coverage has the press given to consumer privacy issues relating to direct marketing?; what aspects have they focused their coverage upon (e.g., how much coverage have industry initiatives to reduce consumer concerns received?); and what has been the tone of the stories (i,e., positive, negative, or neutral) toward the direct marketing industry? Second, how important have consumer privacy issues been to the public and has that importance increased over time? And third, is there any evidence to suggest that media attention allocated to consumer privacy issues is influencing the importance of these issues for the public?

To answer these questions this study examines five leading newspapers’ coverage of privacy issues relating to direct marketing from 1984 through 1992. These papers are: The New York Times, The Wash- ington Post, The Chicago Tribune, The Los Angeles Times, and USA Today. The criteria for newspaper selection are described in detail in the Methodology section. The study also examines available public opinion over time about the issue from leading research centers. This information is essential in that it allows an initial assessment of the influence of press coverage on public opinion.

A THEORETICAL BASE: AGENDA- SETTING RESEARCH

In essence, the claim of both camps, the press critics as well as the proponents, can be reduced to the following theoretical proposition: media salience of the issue leads to public salience of the issue. This hypothesis is the foundation for agenda setting, which states in its most basic form that what the

12 JOURNAI OF D I R E C T M A R K E T I N G V O L U M E 8 N U M B E R 2 SPRING 1994

media deem important-as shown by increased coverage-the public will deem important (6,21). The hundreds of studies that have been imple- mented to test the theory suggest many qualifica- tions to the hypothesis (30) . One crucial qualifi- cation that seems most important in this very early stage about the specification of effects regarding direct marketing and privacy is the categorization of this issue.

Researchers have offered several ways to categorize issues. Zucker suggested that unidirectional causality should occur for unobtrusive issues, which he argued include drug abuse and pollution, in which events create issues with which people or- dinarily have no direct experience (36:227). He concluded that an individual tended to rely on the mass media for information and an interpretation of the issue when the individual had less direct experience with the issue. Conversely, for obtrusive issues-issues with which individuals had greater familiarity, such as cost of living and unemployment-salience in the public agenda led to salience in the media agenda. Zucker’s results were con- firmed by Eyal (lo), who used factor analysis to categorize agenda items as obtrusive and unobtrusive, as opposed to Zucker, who categorized issues on the basis of his own judgment (30) . Neuman (25) , in an analysis of the threshold of public attention, also suggested that one of the major revisions in agenda-setting research is whether different types of issues may be characterized by unique agenda- setting dynamics over time, most specifically obtrusive issues and unobtrusive issues (26,36). In regard to issue differences, Neuman offered a topology of issues. One element of the topology, problems, examines the role of obtrusive issues, exemplified by inflation and unemployment. These issues garner great concern from the public, and both have periodic and sometimes dramatic crises of sudden change. Neuman (25) suggested that these are stories without a story line.

After repeated interviews with various economic ad- visors about a series of abstract and seemingly in- tractable problems, even the most enterprising and well-motivated journalists will be tempted to turn their attention to other matters. (25:170)

As suggested by Iyengar and Kinder (17), these types of problems may have limited agenda-setting effects because of the obtrusive nature of the prob-

lem: people experience them at the grocery store and gas station; they do not need the media to tell them about them. Yagade and Dozier (35) offered another way to categorize issues, which they termed concrete versus abstract. They argued that “whereas obtrusiveness of an issue is the degree to which an issue forces itself into the direct experiences of individuals, the abstractness of an issue is the degree to which an issue is difficult to conceptualize, to be made sensible” (35:4). Abstract issues reduced agenda-setting effects because individuals found it difficult to attach salience to something they did not comprehend, while concrete issues enhanced agenda-setting effects.

Based upon these empirical findings, this study of direct marketing and consumer privacy assumes that the issue is an obtrusive, concrete issue. While some may suggest that the media have set the public agenda, in this instance it is possible that people develop their perception of an issue’s salience based on their own experience (e.g., phone calls that interrupt their dinner or the dreaded tone of a pitch voice as they attempt to put their second of three children into the tub). I t also seems plausible that most people view this issue in obvious, concrete terms. The findings of Zucker (36) and Yagade and Dozier (35) suggest that the media agenda fails to have a unidirectional effect on the public agenda. Conversely, research suggests that the real-world conditions may affect the public agenda, and that both of these may in turn set the media agenda (1 1).

METHOD

The Media Giuliano’s comments (1) that the newspaper industry had been attacking the direct marketing industry prompted our decision to focus this study solely on newspaper coverage of privacy issues. The newspapers used in this study were selected on the following criteria: a) each must be a leading and influential paper; b) as much as possible, each should represent a different geographic region of the country; c) each must be included in Mead Data Central’s Nexis service; and d) each should have its own wire service (another indication of the paper’s influence). All the papers in the sample have their own wire service except USA Today, which has the Gannett Service.


Over a dozen major newspapers were originally considered; however, many of these papers-such as The Denver Post, The Atlanta Journal a n d Con- stitution, and The Wall Street Journal-were elim- inated after failing to meet one or more of the above criteria. For instance, The Wall Street Journal was dropped because Nexis only has full, cover-to-cover abstracts starting from 1989. Having five years (1984-1988) of only selected abstracts was unac- ceptable. The following papers were finally selected: The Washington Post, The New York Times, The Los Angeles Times, The Chicago Tribune, and USA Today. For each of these papers, nine years of coverage, 1984-1992, were examined. This ensured that both current information and a representation of coverage over a substantial period of time were included in the analysis.

To locate potentially relevant stories, Mead Data Central’s Nexis service was used to search for key phrases in these five papers. Searches were done of combinations of the following topical words and phrases: “direct marketing,” “privacy,” “advertising,” and “consumer credit.” The stories found from these initial searches were read to cull out those that failed to deal with privacy issues relating to direct marketing. For example, stories that dealt with “advertising” homes that featured “privacy” were deleted. The remaining stories were then re- checked to delete duplicates. Each of the 345 remaining stories were coded as to story type (i.e., gathering and use of consumer information, regulation, intrusion, and technology), tone of the story toward the direct marketing industry, publication date, number of words, and newspaper. All 345 stories were first independently coded by two of the authors. The intercoder agreement ranged from 81 - 89 percent for the four story types. The coders then discussed all items on which there was disagree- ment and these items were then reevaluated by consensus.

Given below are the definitions used to code for the types of story. The story types are not mutually exclusive. For instance, a story could be about information gathering, technology, and regulation. Thus, the coding of story type allowed multiple designations for each story. In other words, the coders looked for the presence of material relating to the four story types outlined below. The definitions used to code for tone of story are also shown below. The coding of the tone of the story was de-

termined by whether the story was predominantly positive, negative, o r neutral toward direct marketing practices. Although the negative and positive categories are easily understood, the coding of the neutral category requires an explanation. A story was judged as neutral when it lacked positive and negative elements and when the negative and positive elements were given approximately equal weight in the story.

Definitions for Codlng of Story Type

* Information gathering and/or use-if the story refers to the collection of consumer information, by any means, or the use of consumer information (e.g., audience segmentation, message development, or media selection) by a direct marketer. (This does not include references to government usage or individual abuse of personal information.)

9 Intrusion-if the story deals with the reception by a consumer of uninvited advertising messages (regardless of the medium used). - Regulation-if the story deals with legislative activity, current laws, proposes or argues against regulation, legal rulings, and so forth.

* T e c h n o l o p i f the story includes references to new technology, meaning new machines or new uses and applications for these techno- logical devices (e.g., computers, cellular phones, automatic number dialers).

Tone of Story toward DM Industry

* Positive-information in story portrays DM industry or its activities in a predominantly positive light.

* Negative-information in story portrays DM industry or its activities in a predominantly negative light.

0 Neutral-the story is either neutral in tone and content or contains positive and negative elements of approximately equal weight (mixed).

Public Oplnion A search was conducted at the Roper and Harris Centers to glean any questions that have been asked by major research institutions about the issue of direct marketing and privacy. While numerous questions were found, few studies consistently asked the same questions or used similar scalings that would


provide a database over time that could be com- pared to the media’s coverage of the issue. The studies by Equifax for 1990 through 1992 (12-14), as well as 1978 and 1983, did provide a starting point with their question, “how concerned are you about threats to your personal privacy in America today?” The findings (12-14) from these years are used as a point of departure to examine public opinion trends and to address the study’s third question, the relationship between media coverage and public opinion.

Media Salience and Public Salience Examining the relationship between media salience and public salience can take a number of ap- proaches, from an individual-level analysis with primary experimental or cross-sectional survey data to a macroanalysis based on consistent secondary data collected over time. Agenda-setting research has begun to examine and model the relationship of media content and public opinion over substantial periods of time (3-5,11,19,31). Rogers, et al.’s examination of the AIDS issue asked “how does this agenda-setting process work over time?” and stated that a broader conceptualization of agenda- setting research that “considers influences among various agendas while focusing on issue competi- tion, the roIe of new information about an issue, and changing media interpretations is likely to be more useful in explaining the development of an issue through the agenda-setting process” (31 :7). The present study attempts to build on this latter strain of research by examining the trends in media coverage and public opinion over time. These trend analysis studies require a substantial number of measures made at equal intervals at numerous time points. Unfortunately, a search through the public opinion polling data indicates a lack of consistently asked questions about consumer privacy issues. Be- cause the amount of consistently asked questions over time is minimal, the type of complex analysis, which often uses ARIMA modeling or time-based regression analyses, cannot be done with the limited data points presented here. However, the data does allow for a qualitative analysis of the influence of the press on public opinion. The analysis also addresses important trends, offers some direction to the industry as it continues to collect data about this issue, and points the way for future research in this area.

RESULTS

The Media’s Picture of Direct Marketing and Privacy There has been a continual increase in the coverage of consumer privacy between 1984 and 1992, with the greatest increase occurring between 1988 and 1991, as shown in Table 1 and Figure 1. In comparison to a uniform distribution, a test of goodness- of-fit found there was a significant difference in the frequency of these stories during these years (X‘ = 253.83,df81, p < .05>. As Table 2 illustrates there was also a difference among newspapers in the number of stories published. A goodness-of-fit test found there was a significant difference among papers (X’ = 62.14,,,,, p < .05), with The New York Times, during this time, publishing a dispropor- tionately large number of stories on the topic. Con- versely, the average length of the stories rose in 1985 and then peaked in 1988. After 1988, the average length of the stories dropped dramatically. A trend analysis of the average numbers of words per story indicated that there was a significant quadratic trend ( F = 4.60idfll, p < ,051, which reflects the shorter average length of stories at the beginning and end of the examined period; so although the newspapers were devoting more articles to privacy issues, they were generally utilizing less space and detail on the stories after 1988. Both this intensity and volume appeared to have dropped fairly sig- nificantly in 1992.

Against this increase in frequency and the drop in length of stories, the public’s concern about the issue has remained high and consistent since 1983.

TABLE 1 Number of Stories by Year

Year Total Frequency of Stories

1984 10

I985 6

1986 14

1987 14

1988 14

1989 51

1990 62

1991 I05

1992 69

JOURNAL OF DIRECT MARKETlNG VOLUME 8 NUMBER 2 SPRING 1994 15

~~ ~ ~

TABLE 2 Number of Stories by Paper

Paper Total Number of Stories

Chicago Tribune

Lo5 Angeles Times

New York Times

USA Today

Washington Post

46

74

I22 39

64

In 1992, Equifax (14) suggested that in 1978 about 64 percent of Americans were “very concerned” or “somewhat concerned” about threats to privacy (not included in Figure 1). From 1978 to 1983 this figure rose to 77 percent. N o data exists for the period from 1983 to 1990; however, Figure 1 suggests that by 1990 those “very concerned” and “somewhat concerned” rose only to 79 percent. In 1991, it remained at 79 percent and in 1992 in dropped to 78 percent. These findings suggest that public concern was very high even before the media began to run with the issue in the mid-l980s, and that the dramatic increases in frequency and intensity of cov-

erage had little relationship to a significant increase in public salience.

Figure 2 suggests that the percentage of stories with a predominantly negative slant peaked in 1987, and only made a slight resurgence in 1990, after which the percentage of negative stories decreased. Again, this appears to counter the argument that the media were “bashing” direct marketers over the issue. Although the media may have criticized the industry a bit in 1987 and 1990, there does not appear to be a corresponding increase in public salience in relation to these negative peaks.

The tone of each story toward the direct marketing industry was coded in terms of whether it was positive (+l) , neutral or balanced (0), or negative (-1). The mean evaluation of all 435 stories was slightly negative (-.21). However, as Table 3 and Figure 3 illustrate, most stories were neutral in tone, followed by negative stories. The positive category comprised the smallest number of stories.

Although there was an increase in the number of consumer privacy stories during this nine-year period, there was no significant trend found in terms of tone and story content ( F = . l l l d f l J , p > .05). This means that, over the entire period examined, the average evaluation of stories did not vary signifi-

FIGURE 1 Number of Stories, Number of Words, and Public Opinion by Year

16 JOlJRNAL OF DIRECT MARKETING VOLUME R N U M B E R 2 SPRING 1994

50 I Negative Evaluation I

8 4 8 5 8 6 8 7 8 8 8 9 9 0 9 1 9 2

FlGURE 2 Negative Evaluation by Year

cantly-that is, the stories failed to become more positive or negative as time passed.

Each story was also coded in terms of whether it contains material on information gathering and use, regulation, intrusion, and technology-all relating to direct marketing and consumer privacy. Of the 435 stories coded, 71% contained references to information gathering, 50% to regulation, 45% to technology, and 30% to intrusion. Table 4 lists the percentage of stories that fell into the four types of

TABLE 3 Number of Stories by Evaluation

Year Positive Neutral

1984 0 7

1985 0 6

1986 0 10

I987 0 8

1988 0 12

1989 4 35

1990 4 36

stories by each year. Because a story can contain information of more than one type (e.g., a story can contain material about regulation and intrusion) the percentages do not add up to 100.

Over the years there is an inverse relationship between the average number of stories that address information gathering and use issues and the number that address intrusion ( Y = -.45, p < .05). As shown in Figure 4 , the topic of intrusion peaked in 1988, with it being found in 50% of all stories ex-

80

70

60 Negative 8

3 If $ 5 0

2 40 0 6 $ 3 0

20 6 2 10

12 0

22 1984 1985 1986 1987 1988 1989 1990 1991 1992

JOURNAI OF DIRECT MARKETING VOLUME 8 NUMBER 2 SPRING 1994 17

TABLE 4 Percentage of Story Types by Year Year information Regulation Intrusion Technology

I 984 80% 40% 20% 30%

1985 50% 50% 33% 50%

1986 43% 57% 29% 50%

1987 64% 43% 43% 36%

1988 57% 21% 50% 57%

1989 75% 37% 29% 47%

1990 58% 55% 3 7% 55%

1991 73% 59% 30% 40%

1992 86% 51% 17% 43%

amined that year; in 1992, it dropped to only 17%. By contrast, information gathering was found in 43% of all stories examined in 1986, and it continued to increase to 86% in 1992. One plausible explanation for the inverse relationship is that journalists have come to perceive consumer privacy as relating more to issues of direct marketers' gathering and use of consumer information than to issues of intrusion. This would not only explain the increases in information gathering and use issues, it would also help explain the decline in intrusion stories. However,

this explanation generates the question of what influenced the shift in the journalists' perspective toward information gathering and use issues and away from intrusion. One answer may be the success of two industry initiatives (i.e., the Mail and Telephone Preference Services). If the reporters felt that the Preference Services reduced the problem of intrusion, they would shift the focus of their stories ac- cordingly.

To investigate this possibility the five newspapers were reexamined-this time in terms of their coverage of the Preference Services offered by the DMA. There were 68 stories that dealt with Mail and/or Telephone Preference Services. Table 5 lists the number of MPS and TPS stories by year and newspaper. As illustrated in Figure 5 and Table 6, there is a strong correlation between the number of intrusion articles and the number of articles which mention the telephone and/or mail preference services per year ( r = 2388). As one has increased, so has the other. As the total number of privacy stories increased until 1992, so did the number of stories on intrusion. However, the percentage of all privacy stories that dealt with intrusion has been decreasing since 1988. It is posited here that one cause of this decrease has been the press reaction to the MPS and TPS. If this explanation is accurate, then these

100 I 100

lo 1 " I I -

8 4 8 5 8 6 8 7 8 8 8 9 9 0 9 1 9 2

-

FIGURE 4 Information Gathering and Intrusion by Year

18 J O U R N A L OF DIRECT MARKEllNG V O L U M E 8 NUMBER 2 SPRING 1994

~~~ ~

TABLE 5 Frequency of "Mail and Telephone Preference Service" Stories

Chicago LOS Angeles New York Washington Year Tribune Tlmes Times USA Today Post Total

1992 3 3 1 4 I 12

1991 4 4 0 4 4 16

1990 4 2 0 3 4 13

1989 4 1 2 0 0 7

1 988 0 1 1 0 1 3

1987 1 3 2 0 0 b

1986 2 2 0 0 0 4

1985 2 1 1 0 2 b

1984 0 0 1 0 0 I

Total 20 17 8 1 1 12 68

two industry initiatives are not only being reported but appear to be influencing the focus of press coverage. Obviously, this is only one of many possible explanations. The development and testing of these explanations, as well as many related questions, illustrate the fertility of this research area.

CONCLUSIONS AND IMPLICATIONS

This study begins to fill a void in the literature by addressing three important yet until now unad- dressed questions. First, how much coverage has the press given to consumer privacy issues relating to direct marketing, what aspects have they focused

their coverage upon, and what has been the tone of these stories (i.e., positive, negative, or neutral) toward the direct marketing industry? Second, how important have consumer privacy issues been to the public and has that importance increased over time? And third, is there any evidence to suggest that media attention allocated to consumer privacy issues is influencing the importance of these issues to the public?

In terms of the first research question, this study found an increase in the frequency of stories during the 1980s followed by a decrease in 1992. Caution should be exercised when interpreting the 1992 results since that was a presidential election year and

TABLE 6 A Comparison of "Marl and Telephone Preference Service" (M/TPS) Articles to Privacy Articles that Include Intrusion

Year M/TPS Articles Intrusion Articles

r 984

1985

I986

I987

1988

1989

1990

1

6

4

6

3

7

13

2

2

4

6

7

15

23

35

30

2s

20

15

10

5

0 '84 '85 '86 '87 '88 '89 '90 '91 '92

+ M./T. P. S. Articles +lnhusion Articles

1991 16 32

1992 12 12 FIGURE 5 Number of Intrusion and MPS/TPS Stories by Year


the campaign coverage may have tended to push some topics off the media agenda. Since the decrease in the number of privacy-related stories in 1992 may be just a short-term decrease, it cannot be interpreted as the start of a trend until more time has passed and more research has investigated this issue. In another facet of media coverage, the average length of stories peaked in 1988 and dropped dramatically thereafter. Thus, although the number of stories was increasing during this time period, after 1988 the amount of space devoted to each story was decreasing. Just as important are the types and the tone of the stories written about direct marketing practices and consumer privacy. Table 4 shows the percentage of story type by year. The results regarding the tone of the story may surprise some readers. Although many direct marketing practitioners feel that newspapers emphasize only the negative, the results of this study do nof support this belief. Most of the stories were neutral in tone. However, as Table 3 and Figure 3 illustrate, the number of negative stories is greater than the number of positive stories for every year except 1985, when there were no positive or negative stories. Therefore, it is understandable that the perception of negative press exists even though the majority of stories are neutral in tone.

The second and third questions asked: “How important have consumer privacy issues been to the public and has that importance increased over time?” and “Is there any evidence to suggest that media coverage of the issue is influencing the importance of the issue to the public?” According to the Harris-Equifax studies, the public has had a high degree of interest since at least 1978, and concern rose fairly sharply between 1978 and 1983. How- ever, while interest remained high, the issue’s salience to the public does not appear to be related to the media’s increased coverage of the issue in the 1980s and early 1990s (see Figure 1). The findings point more to the obtrusive nature of the issue. People experience direct marketing in their dens, kitchens, and mailboxes. This direct experience and this study’s data appear to suggest that “reality” was driving public concern long before the media be- came involved. Perhaps a more fruitful research direction would be to examine the relationship between real-world measures of direct marketing contacts with consumer (e.g., frequency of telemarketing or direct mail exposure) from 1978 to

the present and then to compare this to the salience of an issue on the public and media agenda. As suggested by Gonzenbach (11) and by Erbring, et al. (9), for other obtrusive issues, this real-world cue agenda may be the true predictor for both public and media salience.

Managerial Implications An old adage says that actions speak louder than words. This simple message applies here. Although both the positive and the negative press coverage is thought to be a powerful influence by many direct marketers, this study indicates that industry actions can influence press coverage and more importantly influence consumer perceptions of direct marketing practices. For instance, industry initiatives to reduce consumer concerns, such as the MPS and TPS, have received press coverage. This press coverage not only increases consumer awareness of positive industry actions, it also appears to influence the type of story written. As discussed earlier, the topic of intrusion peaked in 1988, with it being found in 50 percent of all stories examined that year; in 1992, it dropped to only 17 percent. These results suggest that the press now emphasize direct marketers’ information gathering and use practices in their privacy stories and regard intrusion as less of a concern. Thus, it is a combination of industry action and promotion of these initiatives that appears to influence story content.

Direct marketers and industry trade associations must continue these efforts and take additional actions to reduce concerns regarding the gathering and use of consumer information if they are to build a positive perception in the minds of the public and the regulators. The last statement will not come as a surprise to some direct marketers for they have already begun to take action. Either individually or in conjunction with the DMA, these direct marketers have started working to educate consumers and regulators about the process and benefits of using consumer information for marketing purposes. In- deed, the importance of these efforts is reflected in one of the goals in the recently announced DMA Four-Point Privacy Action Plan (i.e., to educate consumers on how and why information is collected and used by the industry) (7). However, many direct marketers are not yet participating in these efforts and without their participation the probability of reducing consumer concerns is greatly diminished.-

20 JOURNAL OF DIRECT MARKFJING VOLUME 8 NUMBER 2 SPRING 1994

Certainly the press will be just as quick to report on the problems caused by these practitioners as they will be to report on positive industry initiatives.

In addition to educating the public about the how and why information is collected by the industry, direct marketers should routinely inform consumers when information is collected, let them know how information is used, and tell them who will have access to the data. Implementing periodic consumer reviews of the information would also benefit both parties by increasing consumer knowledge about the process and increasing the accuracy of the information (28). If more direct marketers take actions such as these and actively promote their initiatives, press coverage will follow. More importantly, according to the results of this study, consumers will respond more strongly to actions than rhetoric.

uation of the story. Just as a direct marketing practitioner may perceive a story as negative when the journalist insists it is balanced, each consumer’s perception of the story may vary. Thus, it may be fruitful for researchers to examine the consequences of different evaluations. Does perceiving a story as more negative increase the probability that the reader will hold a negative attitude toward the spe- cific direct marketing activities discussed in the story?

It would also be beneficial to study the coverage of privacy issues with a larger sample of newspapers and other media. For instance, Television News In- dex & Abstracts could be searched for television news stories. Major news magazines also have in- dexes that could be used to locate relevant stories. In summary, many opportunities exist because there is so much we have yet to learn in this area.

DIRECTIONS FOR FUTURE RESEARCH

Abundant research opportunities exist in this area.

Since the research presented here suggests that media salience of consumer privacy issues related to direct marketing is not leading to public salience of these issues, real-world cues may more likely

REFERENCES

promising opportunities are Outlined here. 1, Alberta, Paul M, (1991), “LISPS Rejects Idea of Linking Rate Breaks to Mail Preference,” DM News, 13(39), 1,8. 2. Behr, Roy L. a n d Iyengar, Shanto (1985), “Television News, Real-world Cues, and Changes in the Public Agenda,” Public Opinion Quarterly, 491 38-57.

lead both the public and the media agendas on these issues. Obviously, more research is needed to test these statements. Ideally, this research will make use of real-world cues such as estimates of the frequency of telemarketing calls and direct mail pieces, as well as direct marketing industry growth and profit figures. These types of cues will indicate the amount of direct marketing activity with which the average consumer comes into contact.

Researchers would benefit if the industry collected data through consistent measures over time and made these data available, as exemplified by the Equifax studies. Also, in order to gain a more thorough understanding of the influence of real- world cues, the media agenda, and the public agenda on one another, researchers may undertake studies that simultaneously model public opinion, media coverage, and real-world cues.

A multitude of measurement issues await researchers. For instance, in this study, the tone of story was evaluated by two coders. I t may be more appropriate to measure tone as an individual’s eval-

3. Brosius, H . and Kepplinger, H. M. (1992), “Linear and Non- linear Models of Agenda-setting in Television,” journal of Broadcasting and Electronic Media, 36(1), 5-23. 4 . Brosius, Hans-Bernd and Kepplinger, Hans Mathias (1990a), “The Agenda-setting Function of Television News: Static and Dynamic Views,” Communication Research, 17, 183-211. 5 . Brosius, Hans-Bernd and Kepplinger, Hans Mathias (1990b, June), “Linear and Nonlinear Models of Agenda-setting in Tele. vision.” Paper presented to the 40th Annual Convention of the International Communication Association Meeting, Dublin, Ire- land. 6. Cohen, Bernard (1963), The Press and Foreign Policy, Princeton, NJ: Princeton University Press. 7. DirectMarketingNeua(1993, May 17), “DMA’s Gitlitz Unveils Four-Point Privacy Action Plan for Industry,” 15(19), 11.

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11. Gonzenbach, W. J. (1992), “A time-series analysis of the drug issue, 1985-1990: The press, the president and public opinion,” International Journal of Public Opinion Research, 4(2), 126-147. 12. Harris-Equifax Consumer Privacy Survey (1990), Atlanta: Equifax. 13. Harris-Equifnx Consumer Privacy Survey (1991), Atlanta: Equifax. 14. Harris-Equifax Consumer Privacy Survey (19921, Atlanta: Equifax. 15. Holsti, 0. (1969). Contenl Analysis for the Social Science and Humanities, Reading, MA: Addison-Wesley. 16. Hume, Scott (19911, “Consumers Target Ire at Data Bases,” Adverlising Age, (May 6 ) , 1. 17. Iyengar, Shanto and Kinder, Donald R. (1987), News that Mallers: Television and American Opinion, Chicago: The Uni- versity of Chicago Press. 18. Katz, James E. and Tassone, A. (1990), “The Polls: Public Opinion Trends, Privacy and Information Technology,” Public Opinion Quarterly, 54, 125-143. 19. Kepplinger, Hans M., Donsbach, Wolfgang, Brosius, Hans- Bernd, and Staab, Joachim F. (19891, “Media Tone and Public Opinion: A Longitudinal Study of Media Coverage and Public Opinion on Chancellor Kohl,” lnternalional Journal of Public Opinion Research, 1, 326-342. 20. Lacayo, Richard (1991), “Nowhere to Hide,” Time, ( N o - vember 1 l) , 34-40. 21. McCornbs, Maxwell E. and Shaw, Donald L. (1972), “The Agenda setting Function of Mass Media,” Public Opinion Quar- terly, 36, 176-184. 22. McCombs, Maxwell E. and Shaw, Donald L. (1977), The Agenda-setting Function of the Press: The Emergence of Amer- ican Political Issues, St. Paul, MN: West Publishing. 23. McCombs, Maxwell E., Einsiedel, Edna, and Weaver, David (19911, Contemporary Public Opinion: Issues and the News, Hillsdale, NJ. Lawrence Erlbaum Associates. 24. Miller, Cyndee (1993), “Privacy vs. Direct Marketing: I n -

dustry Faces Something o n the Order of a Survival Issue,” Mar- keting News, 27(5), 1 , 1 4 1 5 . 25. Neuman, W. Russell (1990), “The Threshold of Public At- tention,” Public Opinion Quarterly, 54, 159-176. 26. Neuman, W. Russell, Just, Marion, and Crigler, Ann (1988), “Knowledge, Opinion, and the News: The Calculus of Political Learning.” Paper presented at the annual meeting of the American Political Science Association, Washington, DC. 27. Nowak, Glen J . and Phelps, Joseph (1992), “Understanding Privacy Concerns: An Assessment of Consumers’ Information- Related Knowledge and Beliefs,” Journal of Direct Marketing,

28. Nowak, Glen J . and Phelps, Joseph (1993), “Advertisers’ Gathering and Use of Individual-Level Consumer Information: Does Privacy Matter?,” working paper. 29. Radding, Alan (1991), “Consumer Worry Halts Data Bases,” Advertising Age, (February 1 l ) , 2. 30. Rogers, Everett M. and Dearing, James W. (1987), “Agenda- setting Research: Where I t Has Been, Where Is I t Going?,” in James A. Anderson (Ed.), Communication Yearbook 11 (pp. 555- 594). Newbury Park, CA: Sage. 31. Rogers, Everett M., Dearing, James W., and Chang, Soonbum (19911, “AIDS in the 1980s: The Agenda-setting Process of a Public Issue,” Journalism Monographs, 126 (April). 32. Schultz, Don E. (1990), “Plowing New Research Ground with New Plowshares,” Journal of Direct Marketing, 4(3), 4-6. 33. Scott, W. (19551, “Reliability in Content Analysis: A Case of Nominal Scale Coding,” Public Opinion Quarterly, 17,321 -325.

34. Television News Index &Abstracts (1988-19911, Nashville, TN: Vanderbilt Television News Archive. 35. Yagade, Aileen and Dozier, David M. (1990), “The Media Agenda-setting Effect of Concrete Versus Abstract Issues,” Jour- nalism Quarterly, 67, 3-10. 36. Zucker, Harold G. (1978), “The Variable Nature of News Media Influence,” in Brent Reuben (Ed.), Communication Yearbook 2 (pp . 225-240), New Brunswick, NJ: Transaction Books.

6(4) , 28-39.


Documents

Press coverage and public perception of direct marketing and consumer privacy