Experian Deal to Add Offline Data to Joint E-Mail Clients

The recent marketing alliance of data giant Experian and e-mail services provider FloNetwork marks another high-profile deal aimed at using offline data to reach consumers online.

Less than a month after forming the alliance, Experian and FloNetwork have signed two clients.

Though the two companies did not divulge specifics, Experian and FloNetwork did comment on what they think this partnership will do for their ability to develop advanced, integrated online and offline marketing campaigns.

(The partnership does not give FloNetwork access to Experian’s consumer credit information, according to representatives from both companies.)

In the short term, the alliance provides Experian an entry point into the e-mail marketing space and gives FloNetwork access to a significant amount of offline customer data. For the long term, and more importantly, the companies think they have established the foundation that will one day allow them to marry online behavior with offline information.

“Initially, you could probably see us taking a lot of the offline information we have and helping our clients to decide how to move their campaigns online,” said Scott Worthem, direct of business development and investments at Experian, Orange, CA. He wouldn’t identify which areas Experian is focusing on but said it would look to combine online and offline direct marketing efforts.

Reggie Brady, vice president of partners and strategic development for Toronto-based FloNetwork, took the description a bit further.

“We want to be prepared to offer customers the ability to allow virtual behavior to trigger physical direct marketing campaigns,” Brady said. A FloNetwork client, like BarnesandNoble.com for instance, may want to identify who in its customer base has children ages 2 to 5 so it could promote a new children’s book to that segment. Experian’s data warehouse, which contains demographic information 95 million U.S. households, could provide that kind of offline detail.

Meanwhile, marketing services provider Cogit.com announced last Octoberit had signed an exclusive deal with The Polk Co. to use the data giant’s offline information to help e-commerce sites deliver more targeted offers to visitors. Polk, Southfield, MI, has demographic and lifestyle data on some 111 million households that it accumulates from states’ vehicle registration information, warranty cards on consumer goods and other sources.

Meanwhile, online ad services firm DoubleClick made a similar announcement earlier this year concerning acquired database concern Abacus. DoubleClick said it might combine clickstream behavior with the Abacus database which holds the catalog buying behavior of 88 million U.S. households. However, the news won DoubleClick a barrage of criticism which eventually forced it to back away from those plans.

Brady said what FloNetwork and Experian are exploring is different because it would be implemented in the future and with the companies’ clients supposedly gaining permission from its customers to do so.

“What we’ll have to do is make sure that our clients have the appropriate privacy policies on their Web sites,” she noted. As its clients’ e-marketing consultant, FloNetwork is advising them to make privacy provisions now for information that they might want to use in the future. Clients who did not develop privacy policies when the time came to merge the online and offline data would not be allowed to participate, Brady said.

While these long-term plans possess all the sizzle to succeed, the Experian/FloNetwork alliance provides each party with more immediate benefits. Experian, a $1.5 billion traditional direct marketer, gains a ready-to-go platform for implementing e-mail and other online marketing efforts. Prior to this deal, Experian’s only Internet initiatives consisted of an online list fulfillment service and a program called Visitor Insight, which collected and delivered online data.

Experian officials listed four reasons for choosing FloNetworks over the other e-marketers they considered: its technology capabilities, its reporting and analysis tools, the scalability of its products and, most significantly, its understanding of direct marketing principles.

(Brady, as well as several other FloNetwork officials, including both its East and West Coast sales managers, worked for Acxiom before joining FloNetwork.)

“FloNetwork has a proven track record in the direct marketing industry, and we are excited to enter this strategic partnership with them,” said Tom Newkirk, chairman of Experian North America.

FloNetwork’s cut in this arrangement is twofold. First, Experian’s data is now available to them. In one example, Brady said Experian’s Visitor Insight program could enable FloNetwork to take a customer name and address from a client’s e-commerce Web site, conduct an instant address verification and provide additional bits of demographic information.

Second, the deal gives the Internet marketer a chance to win a whole new set of clients. Since Experian had no “corporate” e-marketing solution, many of its customers did inhouse e-mail campaigns or worked with other providers. Some aggressive Experian sales reps have even struck side deals with third party e-marketers to work with their particular accounts.

“We’ve got to first win the clients over to what we hope will be seen as a better suite of services and also win that Experian account person over since he already has created relationships [with other e-marketing firms],” said Brady.

During the integration phase, FloNetwork will train the Experian sales staff on its services and make joint sales calls. Eventually both companies want to reach a point when only Experian will have contact with customers. FloNetwork will also do some hand-holding early on in back-end and production management.

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