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DCA mounts major campaign to save important consumer protection scheme

Earlier this year, SHOPS (the Safe Home Ordering Protection Scheme) announced that it was closing its operations. Originally established as MOPS (the Mail Order Protection Scheme), it provided risk- free protection for consumers placing orders on a CWO basis with off-the-page and insert advertisers.

DCA President, Nigel Swabey, and Chairman, Alex Pratt, wrote to the SHOPS Board earlier this year to express their concern about the closure of the scheme and the potential loss of its highly experienced secretariat. Together with Deputy Chairman, Mark Wilby, they have proposed that the SHOPS Board should consider a broadening of the scheme and an extension of its cover to provide protection for customers purchasing goods through any type of advertising medium, including TV, online and postal advertising. As the principal representative of advertisers and agencies who have contributed to the scheme, the DCA has been working closely with the DMA who have in turn proposed certain changes to the Articles of Association of SHOPS, which would facilitate an extension of the scheme.

Mail order businesses, other cash-with-order advertisers and their advertising agencies have funded the SHOPS scheme over a period of some 40 years. Significant fees have been paid based upon annual media spend. Over the life of the fund, the cumulative contribution of a number of larger advertisers amounts to over one hundred thousand pounds each. The lion’s share of all SHOPS income has come from businesses in DCA membership. Most members see great benefit in carrying the SHOPS logo in their advertising as a badge of reassurance to customers that their purchases are covered by the SHOPS guarantee fund.

“Although newspaper publishers consider that the threat of readers losing their deposits when making purchases from NMA publications on a cash-with-order basis has greatly diminished, the threat of business failure persists. It has never been easy for advertisers to meet the criteria for membership of SHOPS and businesses that have been less well-financed have in the past failed the SHOPS vetting process”, said Nigel Swabey. He added “I can see no good reason why the SHOPS Board would wish to oppose a continuation of the scheme and an extension of its scope to cover other advertising media where the risk of business failure may be even more present. This scheme was established in order to protect the interests of consumers wishing to purchase direct by mail order. It seems entirely appropriate that SHOPS should be allowed to continue its good work, with the benefit of its consumer guarantee fund being extended to cover other direct retail transactions”.

Deputy chairman Mark Wilby continued “DCA members have created a significant fund which guarantees all purchases from NMA-member publications – both newspapers and magazines. We at the DCA, together with our peers at the DMA, believe that the SHOPS scheme should continue to serve the very same purpose for which it was founded, and that both the scheme and the fund should be deployed to protect and support all consumers who buy from the direct commerce sector”.

Alex Pratt, chairman of DCA and CEO of direct retail business Serious Readers, a heavy user of press advertising, said “Any decision to dissolve the scheme and disband the highly experienced SHOPS secretariat would represent a great loss for the direct marketing industry. With the current growth in online marketing, this is hardly the right time for any move that might diminish the extent of consumer protection available to the general public. There is currently a fund surplus of some £3.7 million held by SHOPS which could easily support an extended consumer protection scheme. Whilst the publishers behind the NMA (National Media Association) may consider that the SHOPS marque is no longer of great value to the consumer and our industry, we argue that there is a strong case for working with the DMA to ensure that this important scheme continues”.

Further food for thought

The Articles of Association which govern The Safe Home Ordering Protection Scheme Limited, operator of SHOPS, state clearly that upon the dissolution of the Company that this fund be given or transferred to some other institution having similar objects to the object of the Company – and that, if this cannot be determined, to some charitable object.

The Board members of the DCA, led by President Nigel Swabey, have been in discussion with the Group CEO of the DMA to ensure that the fund is deployed in support of a broader-based continuation of the SHOPS consumer protection scheme. The Board believes that this will drive consumer confidence in buying direct and help to promote best practice amongst DCA members, as well as the wider direct commerce community.

To further this, Board members of DCA will be attending ongoing meetings with the DMA and the SHOPS Board to press the case for the continuation of the SHOPS scheme as outlined above. Board members will be accompanied by a delegation of SHOPS member advertisers, agencies and other interested parties.

There are several ways in which you can help.

1: share your opinion on this matter via a statement which will be incorporated into a DCA memorandum, for eventual presentation to the SHOPS Board.

2:  email your thoughts and questions to the DCA board via jane@directcommerce.biz .

3: volunteer to join the DCA delegation to a meeting being organised between representatives of the NMA, SHOPS and the DMA in central London. The provisional date for this meeting is 21st June.

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