Recently, I noticed something remarkable had happened in the data management business in response to the astounding growth of the Web. What was most amazing about this change was that I can describe it in two words: Very little!
Instead of being transformed, eliminated or even sidelined, the methodology of data management and direct transactions has been reborn, reinvigorated and more importantly, reinforced. How did this happen? It occurred because data management and the principles of direct transactions are consistent from one medium to another. The more you know about your site's eyeballs and their prospect counterparts, the closer relationship you can initiate and forge.
Data management is now the core of the new economics of information. I think of it as somewhere between sixth sense and the cost of doing business. Without it, you can't steer the boat — or achieve that state of grace known as critical mass.
Direct transaction methodology and techniques are what is growing relationships across all of the current business models on the Web: from buy-sell fulfillment models like online financial brokers, to metamediary sites that provide transaction services to virtual malls that host many online merchants, to subscription models that require a fee to read their premium content. All of them rely on data and information strategy management techniques, principles and technology in the same ways — because the principles hold. In other words, the cost of competing for consumers dictates an ever increasing need to initiate and maintain relationships aggressively and knowledgeably.
Web companies, no matter what their business model, need to find and grow their customer base via acquisition and retention to compete or face being cannibalized. Only now, thanks to the interactive nature and speed of testing, the role of data management professionals as a strategic marketing partner has been reinforced because the vigilance involved in establishing and growing a relationship on the Web has to be guided by incentives, consent and content.
In fact, since the new media mix now encompasses print ads, billboards, television, radio, e-letters, direct mailings, catalogs, magalogs and even events, the acquisition cost of attracting eyeballs have escalated at quantum speed. Maintaining an increasingly sophisticated database is paramount to maximizing ad dollars.
These new parameters of database management have implications for our clients internally as well. As revenue wars in the Web world heat up, and the pricing of banners and links continues to fluctuate as wildly as the Dow, experienced data management techniques and strategic insights are helping our clients build their advertising revenue base, outrun their competitors — and launch preemptive strikes.
Testing and measurement are the new mantra for successful sites. By identifying their most valuable segments and creating new programs to market those segments, we can help our clients profile their customers, target new prospects — and upgrade them both. It's a service we have always provided, and yet in the context of the Web economy, it's a service that has been redefined.
By now, you may be wondering if there are any differences between data management in other media — and the Web?
My answer is: Absolutely. The importance of safeguarding the privacy of eyeballs/consumers is more critical in this media than almost any other — if that's possible. In exchange for access (and if they are properly motivated), viewers are willing to exchange valuable information, but if that information is exploited, abandon all hope of retention. We advise our clients that safeguarding their customer's privacy is every bit as critical as delivery and ease of transaction — if they hope to grow. And that's a fact that can't be stressed sufficiently to any client.
If we, as direct marketers, are not visionaries in leading the fight for privacy, we will be held accountable. And the effect on our industry, both in terms of missed growth opportunities as well as regulation, will be large.