Reporting from Germany, Stephan Merz wonders if we will prosper with the season.

After a stressful 2009, a year dominated by the global recession, we endured a long and snowy winter. Now, we have left the cold behind us and can enjoy rising temperatures. But which economic climate can we expect for the year 2010? What is the current status and the outlook for the economy and our industry?

The downward trend of German consumer sentiment has been halted, according to the monthly index published by GfK (Gesellschaft für Konsumforschung). The value for April was predicted to remain at the same level as in March, at least, after dropping for five months in a row. The spring season nurtures hope for an economic recovery, which is additionally supported by a stable employment market.

This general tendency is also reflected by an improving climate in our industry: during the first quarter, we spoke both to numerous clients in different industries and also to colleagues providing various direct marketing services. These discussions, together with our own experiences, point to a generally more optimistic trend than 12 months ago. Some of the projects we discussed back in 2008, which were put on hold last year, have been brought to the table again.

Another good indication of this improved mood is shown by the results of a survey carried out recently by the direct marketing associations in Germany, Austria and Switzerland among their members. The forecast of almost 200 participating companies was more positive for 2010 than the prognosis made a year ago, and those polled declared the end of the economic crisis. Almost 80 per cent are expecting their businesses will enjoy at least a ‘satisfying’ year and just over half believe there will be a positive trend across the entire industry.

Treading carefully

But we have not yet reached the end of the tunnel because, on the flip side, companies are still behaving very carefully. This is also reflected in the high percentage of fixed-term employment contracts: currently, almost every other new employment contract  in Germany is offered on a temporary basis, rather than for an unlimited period.

In addition to this general trend to act cautiously, the direct marketing sector, especially every company involved in handling lists for direct mail campaigns, is still suffering from the new privacy law, which came into effect last September. The organisational effort which is needed in order to fully comply with all the new legal requirements is time consuming and costly.

Thus, it is far too early to sit back, relax and wait for orders to come in. We are currently active, speaking with our international clients and continuing their successful navigation through the stormy conditions in Germany. Their demand for local expertise remains high for many reasons: there is still some legal uncertainty about the privacy law and also clients are not sure how to expertly strike the keys of new media in our region.

Stephan Merz is founder/owner of d2m direct marketing merz – the German partner in the Lists4Europe network. Email: s.merz@d-2m.de