Critical Issues in Direct Marketing:
What Direct Marketers Can’t Afford To Ignore
About Improving Their Environmental Impact
Wednesday, March 21, 2007
1:00 p.m. – 2:30 p.m. EDT
DMA Education Services
Webinar Panelists
Speakers
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Meta Brophy, Director, Publishing Operations, Consumers Union
Oliver Clode, Vice President, Catalog Manufacturing & Marketing Finance,
Williams-Sonoma, Inc.
Chet Dalzell, Director, Public Relations, Harte-Hanks, Inc.
Phil Riebel, Environmental Director - North America, UPM-Kymmene Inc.
Moderator
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Patricia Kachura, Senior Vice President, Ethics & Consumer Affairs, DMA
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Webinar Outline
Instructions to Participants, Kristen Cunningham (DMA)
Introduction of Speakers, Patricia Kachura (DMA)
Overview of DMA Environmental Planning Tool, Chet Dalzell (Harte-Hanks)
A Walk-Through of the Planning Tool
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Design, Production & Printing, Meta Brophy (Consumers Union)
Paper Procurement & Use – Suppliers’ Perspective, Phil Riebel (UPM)
Paper Procurement & Use – Buyers’ Perspective, Oliver Clode (WilliamsSonoma)
Recycling & Pollution Reduction, Phil Riebel (UPM)
List Hygiene & Data Management, Chet Dalzell (Harte-Hanks)
A Demo of the Planning Tool, Chet Dalzell (Harte-Hanks)
Question & Answer Session, Patricia Kachura (DMA)
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Overview of DMA Planning Tool & Optional
Policy Generator
www.the-dma.org/envgen/
Chet Dalzell
Director, Public Relations
Harte-Hanks, Inc.
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A Vision for Success
"America's Most Admired Companies: What gives GE such a
glow? Fresh ideas and being green distinguishes the winners in
our 25th annual rankings. How to get a great reputation…
These days 'green' means something more. The three Most
Admired Companies this year – General Electric, Starbucks,
and Toyota – are building their growth at least partly on
strategies and products aimed at helping preserve the planet."
-- Fortune (March 19, 2007, pp. 88, 90)
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Direct Marketers Take on Environmental Planning
• DMA Board-Level Task Force on Environmental Issues, 1989
• DMA Environmental Resource for Direct Marketers
(First, Second & Third Editions), 1990 – 2004
• DMA Robert Rodale Environmental Achievement Awards,
Initiated 1991
• DMA Committee on the Environment and
Social Responsibility, 2005
• DMA Environmental Planning Tool and
Optional Policy or Vision Statement Generator, 2007
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DMA Committee on the Environment
& Social Responsibility
Established by Board in March 2005
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Identify challenges germane to direct marketers
Encourage members to make progress on these challenges over time
Manage environmental performance of our membership
Appoint members to facilitate these goals: subcommittee and working
group
Environment Record
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Designed and executed survey to benchmark DMA members’ business
practices
Selected benchmark project to inform and improve environmental
performance
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Purposes of the DMA Environmental Planning Tool
Educate and suggest practices to consider in five general areas
related to the direct marketing process
-- Design & printing
-- Paper procurement & use
-- Packaging
-- Recycling & pollution reduction
-- List hygiene & data management
Enable benchmarking in three areas of focus
-- Improve list hygiene & targeting of print communications
-- Increase recovery and recycling of post-consumer material used in catalogs
and direct mail
-- Support well-managed forests
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Why Does Environmental Performance Matter?
• Recognize the formula: greater efficiency = less waste = less cost
• Understand heightened global concerns about environmental
protection and how they influence our business
• Bolster and maintain consumer confidence and trust in our
business, and the role environmental stewardship plays in this trust
• Recognize Fortune 1000 leadership and corporate citizenship –
these firms are setting business trends in "green" activities
• Take responsibility for business matters that affect the planet –
and find practical and innovative ways to manage these areas well
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What Environmental Planning is Not
• A pursuit of environmentalism in our business without a recognition
of where tradeoffs may exist
• A blueprint for being "green" – with higher profits as a guarantee
• The pursuit of an agenda set by a third-party organization which
may or may not understand the direct marketing business
• A requirement that direct marketing businesses publish their
environmental policies and practices publicly
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Desired Outcomes in our Use of the Planner
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Make an understanding and consideration of environmentally helpful
practices more easily accessible in their direct marketing operations
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Enable an internal assessment of present-day practices, one company at
a time – currently 115 listed practices
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Enable a benchmark from which organizations can improve their
environmental performance, with respect to direct marketing
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Deliver a Web interface that is easy to understand, easy to use, and
easy to reuse over time
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OPTIONAL: Provide a draft public policy or vision statement regarding
the environment, for those organizations which choose to do so
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A Walk-Through of the Planning Tool
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Section: Design, Production & Printing
(17 practices)
Meta Brophy
Director, Publishing Operations
Consumers Union
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Environmental Responsibility in Production
• Communicate with stakeholders — marketing and creative, the
production team, outside vendors.
• Everyone has a part to play — make assignments
• Agree to what you are collectively trying to accomplish
• Research, query, investigate options and shop
• Don’t stop until you understand the options and can present them
clearly to your colleagues. Are you at least as conversant in
marketing as your marketing colleagues are about production?
• File away ancillary information for the next project. Pass along
information to others
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The Process
Identify the package
contents
Review and revise
for the next time
Get the specs
and/or a comp
Decide on labeling
Nail down the
details
Analyze the cost
Cycle of
Continuous
Improvement
Enlist vendor input
Present the options
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Use the Planning Tool
• Reduce Waste
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Can you change the size?
Can you eliminate a component?
Can you reduce the weight?
Can you cut the quantity?
Can you route electronically?
• Reduce Toxicity
– Can you test out of the label?
– Can you find another method of creating interest and/or involvement?
• Recyled/Recylable/Reusable Materials
– Paper, poly, corn? BREs in inventory?
– Labels and adhesives?
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Suppliers
• Once they are on board, they stay engaged
• Vendors are a valuable source for new ideas
• They can gather information and spread the word within the
industry
• They share in the accomplishment: We want our vendors to make
good choices, too
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Recent Successes
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Liftnotes on high-yield groundwood
Letters on high-yield groundwood
Postconsumer recycled content in self-mailers
Biodegradable poly
Die-cuts instead of labels
Texture instead of adhesive or ink
Geographic splits
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Key Challenges (Or Are They Opportunities?)
• TIME
– To research
– For the learning curve
– For comparative analysis
• EXPENSE: Print, Paper, Postage, Fuel
– Source reduction can mean cost saving
– Is there an upcharge?
– The future of flats
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What’s Coming Next?
• Stora Enso and Neste Oil to join forces in biofuel development
”…developing technology for producing new-generation biofuels from
wood residues to replace fossil fuels in transportation and thus cut
greenhouse gases.”
-- Stora Enso Press Release, March 16, 2007
• Management thinking — Starting to ‘get’ responsibility
“...a significant number of businesses have got past the ‘why’ of
ethics and corporate responsibility—a critical breakthrough—and
are now trying to wrap their brains around the ‘how.”
-- Ethical Corporation, March 11, 2007
• How Print Got Green
“…printers are taking the business of being green very seriously,
following many paths to get there.”
-- Graphics Arts Monthly, March 2007
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Design & Production In Summary
• Look at every campaign anew
• Make environmental impact part of the assessment along with cost,
quality, and delivery
• Do your research
• Use the DMA Environment Tool and the Resource Handbook
• Bring others to the table — internal and external colleagues
• Make others aware of initiatives — communicate outside your
department
• Ask about what others are doing
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Suppliers’ Perspective
Section: Paper Procurement & Use
(45 practices)
Phil Riebel
Director, Environmental Affairs – North America
UPM-Kymmene Inc.
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Suggestions for Purchasing EnvironmentallyPreferable Paper
Key points based on environmental footprint of paper
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UPM In Brief
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Global leader in printing papers, among
five largest producers in the paper sector
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Listed on DJSI for the fifth year in a row
– 2005 & 2006 industry group leader
– Top score in sustainable fiber sourcing
& advanced environmental
performance
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Ranked No.1 for sustainability by Time Inc.
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Second largest user of recycled fiber in the
printing paper industry
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Paper Product Life Cycle
Forest
Recovered paper
Converted
paper
products
Paper
Chemical pulp
Wood products
Wood raw material to the mills and
energy wood to the power plants.
Energy to the mills
Chips and sawdust for energy production
By-products for pulp and paper raw materials
Paper for converting
Pulp for paper manufacture
Recovered paper
Energy production
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"Environmental Footprint" View of Paper Production
UPM View: Companies are responsible for the environmental impacts caused during the
entire life cycle of their products from raw material and energy sourcing to production,
distribution, recovery and disposal
Papermaking – summary of activities and environmental impacts
Activities
Impacts
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Road construction / harvesting / transport to mill
Other raw material acquisition and transport (clay,
pulp…)
Recovered paper collection / transportation / sorting
Roundwood / chip storage / processing (debarking
chipping)
Pulping (Kraft, TMP, GWD, DIP)
Paper-making
Shipping
Printing (energy, ink, waste)
Distribution / Use and Disposal
Paper recycling
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Habitat
Fossil fuel use / greenhouse gas
emissions
Water / energy use
Wastewater emissions
Noise, dust
Runoff, solid waste
Air Emissions
Solid waste to landfill
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Environmental Guidelines for Purchasers
1. Using a life-cycle approach (footprint of papermaking)
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Evaluate the environmental performance
of suppliers over the key steps in the life
cycle of paper - forest to final re-use
Commit to using a report card to evaluate
annual environmental performance
Address the key steps of papermaking:
-- Forest management
-- Mill operations
-- Purchased power
-- Certifications
-- Paper composition
Evaluate report cards currently in use:
• Paper Profile
• EPAT (Environmental Paper
Assessment Tool)
• EPDS (Environmental
Profile Data Sheet)
Integrate into purchasing decision
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Environmental Guidelines for Purchasers
2. Promote sustainable forest management
• We will promote sustainable forest
management by increasing the level of
third-party certified fiber in our paper,
using recognized credible forest
certification schemes such as PEFC and
FSC. Forest certification levels are to be
supported by a verified chain-of-custody.
• There are two international systems (PEFC & FSC)
• PEFC includes/recognizes SFI & CSA
• Based on several scientific / field assessments, all
systems achieve sustainable forest management
• Three-country study done by UPM / DNV / WWF
• Only 7% of the world's forest are certified – focus on
increasing this
• 72% of the certified fiber is under PEFC
• Verified chain of custody is important to show that the
origin of wood is known and % is accurate
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Certified Forests Globally by Scheme
FSC 27%
PEFC 71%
SFI
SFI
FSC
National schemes:
MTCC 2%
CSA
CSA
PEFC
PEFC
Other
Other
SFI: Sustainable Forest Initiative (NA)
CSA: Canada's National Standard for Sustainable
Forest Management
FFCS
FFCS
FFCS: Finnish Forest Certification System
MTCC: Malaysian Timber Certification Council
FSC Sweden, FSC Maritime etc: (accepted by FSC)
Situation in January 2006
UKWAS: UK Woodland Assurance Standard (accepted
by PEFC and FSC)
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Environmental Guidelines for Purchasers
3. Sustainable use of recycled fiber and promote the recovery of paper
• We will use recycled fiber in appropriate grades
where its use is economically justified and
brings environmental benefits
• We will promote the recycling of our paper
products
• 45-50% of paper products in NA still end up in
landfills: There is a global need to increase the
recovery rates of paper so that the recovered fiber
can be used to make other products
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Environmental Guidelines for Purchasers
4. Reduce consumption
• We will make efforts and set targets
to reduce paper consumption
• This can mean using less paper and
raw materials, lighter-weight papers,
lower brightness, etc….
• Less environmental impacts and raw
materials per page
Example:
ENVIRONMENTAL SAVINGS PER PAGE
(OF CATALOG / MAGAZINE)
40 LB TO 28 LB BASIS WEIGHT PAPER
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20% less water used
10% cleaner wastewater
15 to 25% lower air emissions (SO2, CO2…)
15% less solid waste to landfill
28% less purchased electricity
• Can save mailing costs as well
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Environmental Guidelines for Purchasers
5. Energy and global warming. Carbon footprint.
• Energy and climate change: We
value suppliers who have
switched to less greenhouse gas
(GHG) intensive energy sources
such as carbon-neutral biomass,
and are committed to continual
energy-efficiency improvements
• We consider the impact of our
paper on global warming
• Supply chain carbon (CO2) footprint
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Raw materials to mill
Manufacturing
Purchased power
Transportation to printer, distribution
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Environmental Guidelines for Purchasers
6. Other items
• Illegal logging
• Biodiversity
• Corporate social responsibility
– Health and safety
– Stakeholder engagement
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What is Environmentally-Preferable Paper?
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Sustainable use of wood fiber and recycled fiber in appropriate
grades/locations
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Third-party certification of mills and forests
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Steadily increasing share of certified fiber supported by a certified
chain-of-custody
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No illegal wood or wood from designated protected or conservation
forest areas
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Increasing energy efficiency and biofuel usage – lower carbon footprint
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Meet best-available-technology levels for environmental indicators
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Continuous improvement in minimizing loading per ton of paper: air,
water, effluent, solid waste
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Open, transparent and third-party verified sustainability / environmental
reporting
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Buyers’ Perspective
Section: Paper Procurement & Use
(45 practices)
Oliver Clode
Vice President, Catalog Manufacturing & Marketing Finance
Williams-Sonoma, Inc.
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Environmental Responsibility as a Paper Buyer
• Environmental stewardship is not just a fad – it has become mainstream and is now a business reality
• Everyone can make an impact, regardless of how much paper you
buy
• One size does NOT fit all – every organization’s circumstances and
approach will be different
• Educate yourself – understand the facts
• Be proactive – strategic and proactive solutions are always far
better than reactive solutions
• Incorporate environmental thought leadership into your everyday
language and practices
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Steps All Paper Buyers Should Take
Regularly review
and report on
progress
Establish a
Corporate Vision
Address gaps; move
towards compliance
Develop action plan
and set targets
Determine current
state/baseline
Secure stakeholder
involvement
Cycle of
Continuous
Improvement
Develop a policy in
line with Vision
Communicate policy
to all stakeholders
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How The Planning Tool Can Help
• Strategic Road Map
– Menu of specific principles and initiatives that all Direct Marketers can
choose to adopt and implement
– Checklist for developing a baseline assessment
– Provides insights on key impact areas for continuous improvement
• Educational Tool – to assist Direct Marketers in better
understanding environmental issues and options
• Policy Guide and Generator – easily helps establish a strong
foundation right out of the gate
• Ongoing Evaluation Tool – provides a benchmark against which
to gauge your progress and with which you can reset your baseline
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Motivators for Williams-Sonoma, Inc.
• Corporate Responsibility
– It’s part of our culture
• Cost Savings $$$
– Reducing waste and inefficiencies
– Increasing efficiencies
• Customer Awareness and Loyalty
– Increasingly important to our customer base
• Changing Values of the Workforce
– Attract candidates
– Retain employees
• Risk Mitigation
– Business interruptions from negative publicity/activist campaigns
– Legal actions/forced regulation
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WSI’s Environmental Journey – 2003-2006
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Educated ourselves on the key issues and established a Vision
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Audited catalog paper supply chain and set priorities/targets/goals
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Developed a Responsible Catalog Paper Procurement Policy
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Reached out and partnered with key external stakeholders
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Paper suppliers
– ForestEthics
– Peer Companies
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Printers
– FSC
– Other NGOs
Reduced waste/increased efficiencies – saved significant $$$
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Continued to streamline and improve our List Hygiene and Modeling techniques
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Tested and rolled out lower basis weight paper in all catalogs
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Re-evaluated and reduced trim-size on virtually all catalogs
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Renegotiated and significantly reduced printers’ spoilage allowances
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Expanded use of “versioning”
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Increased the use of the internet as a customer contact vehicle and ordering channel
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Tested and incorporated PCW recycled content into Flagship catalog
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Shifted virtually all (95%+) catalog paper to FSC-certified paper
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Words of Wisdom
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Don’t ignore environmental stewardship – take responsible purchasing
seriously and be proactive about it
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Educate yourself and your organization, and develop a point of view
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Don’t be afraid to reach out to NGOs: Many are well-intentioned, have
subject expertise and understand the need for finding market-based
solutions
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Establish a responsible purchasing policy and communicate it to your
stakeholders – move towards compliance
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Continually challenge yourself and your supply chain partners, and
collaborate with them to find and develop new solutions, including
addressing cost concerns – it doesn’t need to cost more
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Regularly review your progress, report on it, and reset the bar
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Section: Recycling & Pollution Reduction
(32 practices)
Phil Riebel
Director, Environmental Affairs – North America
UPM-Kymmene Inc.
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Sustainable Use of Recycled Fiber
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Top 10 Printing Paper Producers Using Recycled Paper
3280
Norske Skog
2520
UPM
2015
Nippon Paper Group, Inc.
Enough to fill
the Empire
State Building
6 times
1880
Stora Enso
1655
Abitibi-Consolidated
1545
Georgia-Pacific
1430
SCA
1340
Oji
1195
Myllykoski Corporation
1120
Bowater
0
Source: Jaakko Pöyry 23.11.05
500
1.000
1.500
2.000
2.500
3.000
3.500
1000 tonnes
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Benefits of Wood and Recycled Fiber
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Sustainable managed forests and recycled fiber
complement each other as important raw
materials for papermaking
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Benefits of using wood:
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Renewable natural resource
Recyclable and re-usable material
Climate protection (forests are a carbon sink)
Carbon-neutral fuel (biomass)
Benefits of using recovered paper:
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Efficient use of raw material
Decrease landfill waste
Save energy
Creating responsibility and awareness for
recycling
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Net Annual Change in Forest Area, 1990-2000
Deforestation continues in tropical/subtropical forests
in Latin America, Africa and Southeast Asia
Nordic countries
Annual change,
%/a
+ 0.1
Western Europe
+ 0.5
Eastern Europe
+ 0.7
Russia
0.0
North America
+ 0.1
Latin America
- 0.5
Japan
- 0.0
China
+ 1.2
Rest of Asia
- 0.6
Oceania
- 0.2
Africa
- 0.8
-6
-5
-4
-3
-2
-1
0
1
- Annual change, million ha Total average annual change - 9.4 million ha
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2
3
Key Factors for Sustainable Use of Recovered Paper
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Economic and environmental benefits
must be considered
Paper is a valuable resource and should
not go to landfills
Key conditions:
• Minimal transportation
• Modern mills using B-A-T / reduced
environmental load
• De-inked sludge used for energy generation,
or re-used
• Paper mills integrated to DIP
• Paper grades adapted to pulp quality
• Lower end up to newsprint can be 100% RCF
• Recycled paper needs to be affordable and
available
• Input of virgin fiber is essential to make the
paper cycle work
SC
16%
LWC
4%
MFS
18%
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News
62%
Fiber Resource & Demographics
Finland and NA :
•low population density
•large forest resource
•large paper industry
Virgin fiber resource
predominates
net Virgin Fiber / Paper
Exports
UK :
•high population density
•small forest resource
•small paper industry
Recovered fiber resource
predominates
Germany and France:
•high population density
•medium forest resource
•medium paper industry
Both virgin and
recovered fiber
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Source: RISI
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Consumption of Recovered Paper by Region
World consumption of recycled paper is expected to grow from 153 million tons in
2000 to 243 million tons in 2015 (average growth 3.1% per year).
In volume terms, the growth will be fastest in Asia.
250
Million tons
Forecast
Rest of the World
Latin America
200
Rest of Asia
China
150
Japan
Eastern Europe
100
Western Europe
50
North America
0
1980
1985
1990
1995
2000
2005
2010
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2015
Recycling in North America – General Points
• China / Asia’s fiber deficit will be the main driving force for recycled paper trade
worldwide
• EU and NA are very different due to population density, mill locations,
transportation distances, mill investments
North America:
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Larger distances
Older mill facilities / higher environmental load
RCP shortage
High cost compared to mechanical wood fiber – high demand / low supply
Landfill cost also drive recycling (NA are lower than in EU)
In NA, the use of RCF fiber in catalog and magazine grades has no clear measurable
economic or environmental benefit
• Although the initial intention may be to "help the environment" , the end result of using
RCP in high end printing grades is currently driven by "eco-marketing"
• This is causing the environmental footprint (load, impacts) of paper to increase instead
of decreasing
• It does not make much economic or environmental sense to take recovered paper away
from one supply chain (i.e. board mills) and move it to another (i.e. catalogs and
magazines) without ensuring growth of RCP availability
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LWC grade mech. fiber no RCF vs Competing Grade with 10% RCF
Advantage of wood-fiber
based paper
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If done sustainably and using best-availabletechnology, use of recycled paper can result in a
lower environmental footprint of the paper
(primarily less energy used compared to mechanical fiber)
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Environmental Guidelines for Purchasers
Sustainable Use of Recycled Fiber and Promote the Recovery of Paper
• We will use recycled fiber in appropriate grades where
its use is economically justified and brings
environmental benefits
• We will promote the recycling of our paper products
• Due to global paper demand, there is a need to recover
more paper….and grow more trees
• An approach that looks at the environmental footprint of
our paper will ensure that we are doing the right thing for
the environment
• There are other effective ways to reduce the environmental
footprint of paper
• Lighter basis weights
• Lower carbon footprint
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Section: List Hygiene & Data Management
(17 Practices)
Chet Dalzell
Director, Public Relations
Harte-Hanks, Inc.
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List & Data Management: We 'Own' This Opportunity
• All direct marketing is databased
• Our ethics guidelines for notice
& choice span 35+ years
• The list is more important than
the offer and the creative
• The U.S. Postal Service is our
ally in educating mailers
• Every aspect of a list can be
tested
• Enterprise-wide data quality
has gained c-level attention
• The "supply chain management"
for lists and data is completely
in our control
• Responsibility rests with us
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Steps All List Managers Should Take
Test ahead of
rollout; track &
refine
Apply commercial
and USPS data
tools
Ensure data security
each step of the
way
Utilize data
modeling and
segmentation
Develop a Data
Quality Strategy
Apply data quality at
each collection point
Cycle of
Continuous
Improvement
Adhere to a data
hygiene checklist on
all third-party data
Adhere to DMA
Privacy Promise
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The Tool Serves to Help Increase Mail Efficiency
• We Maintain Suppression Lists
• We Offer Notice & Choice
• We Clean Our Lists Prior to Mailing
• We Merge/Purge Our Data
• We Test Market Offers Prior to Rollout
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Key Observations in List & Data
• No rocket science here
• Test, track and document
• Verify suppression applications
• The database as a 'Center for Customer Truth'
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Demo of the Tool
on the DMA Web site:
www.the-dma.org/envgen
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We've Downloaded the Tool – What’s Next?
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Internal? Or External?
Use this as an internal planning tool – revisit as necessary
-- Tackle all at once simultaneously
-- Section by section
-- Practice by practice
Consider adoption of language to share with external audiences:
-- Suppliers
-- Customers
-- Corporate Policy
-- Vision Statements
Give DMA suggestions on possible practices to add to the planner
-- environment@the-dma.org
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Questions?
Next year, will you represent
a Most Admired Company?
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Thank You!
To receive DMA’s free e-newsletter about
corporate responsibility and environmental
issues, please e-mail your contact information to
environment@the-dma.org.
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