Publishing Co-Op Movement Growing
Acxiom/Direct Media, Greenwich, CT, is putting plans together for a publishing co-op to compete with existing offerings from Abacus Direct and Experian Direct Tech. John Carter, product leader for Acxiom's SmartBase, hasn't determined a release date for the new co-op but expects to make a formal announcement this fall. The new co-op won't be limited to publishing files under Direct Media's management or brokerage.
A new entry represents a growing interest and acceptance of the concept of cooperative databases by publishers. By pooling names from the subscriber files of participants, a co-op provides a new source for list rental income and prospecting/reactivation as well as a wealth of data for modeling and profiling.
"A lot of [publishers] still need to know more about co-ops," Carter said, adding that the success of the SmartBase catalog co-op has stimulated queries from publishers. "A lot of people have heard of the concept and they are a lot more open than a few years ago."
Industry experts are divided on the viability of another publishing cooperative. Richard Vergara, who oversaw the development of the first publishing co-op -- the now-defunct Publishers Gateway -- in May 1997 while president of the Kleid Co., New York, isn't surprised by the growth but wonders how many entries the publishers can support.
"I think it was inevitable once it became clear that catalogs were benefiting [from co-ops] for the publishing industry to jump on bandwagon," Vergara said. "You don't know how much room there is for this many databases. There is room for at least two if not three in the publishing field."
Chris Lynde, vice president of information services for Direct Tech, Schaumburg, IL, and its CircBase co-op, welcomes another marketing source for publishers.
"Anybody participating in cooperative databases should feel free to participate in as many of these environments as they can get to work," Lynde said. "At the end of the day, what really matters is whose model outperforms the other guys'."
Both Abacus and Direct Tech made earlier efforts to form publishing co-ops before finally getting off the ground in the last year.
Abacus, Westminster, CO, staked out its niche in the fourth quarter of 1997 by forming a publishing services division to augment its industry-leading merchandise services/catalog database. Publishing services currently maintains 91 titles representing 36 million names from the 88 million households in the overall Abacus Alliance. Abacus receives monthly or quarterly updates from publishers and updates the database continuously.
Direct Tech launched CircBase in April and now has 87 titles representing 38 million names. It will add 45 more titles totaling 15 million names for its next monthly update in October. Direct Tech also maintains the Z-24 catalog database of the last-24-month catalog buyers and is a participant in the RFMplus catalog co-op of 60-day hotline names with three other partners.
Both companies enhance their publishing files with catalog purchase data and vice versa. Abacus allows publishers to take catalog category data and put it on their own marketing database for internal use. Sam Cardonsky, vice president of publishing services at Abacus, said such a combination of data is a definite advantage for mailers.
"In the outside world, publishers couldn't always make catalogs work even if there was some affinity between the two," Cardonsky said. "Having both data sets together enables the [Abacus] Alliance to work better for the mailer than if they were doing it outside the alliance.''
CircBase maintains recency, frequency and monetary data for every magazine subscriber then appends catalog data from Z-24. Unlike Abacus, CircBase is a stand-alone, purely publishing database.
"It's one thing to take a magazine, enhance it [with catalog data] and then turn it back over to the publisher," Lynde said. "It's another to tell a publisher what their subscribers look like in relation to the rest of the industry."