“Data Weenies Beat List Weenies”

The last decade was a sweet one for database marketers. Lots of data was being collected and customers and prospects responded the way they were supposed to.

But nothing lasts forever. Somehow, says Don E. Schultz, professor of integrated marketing at Northwestern University, customers changed and database marketers didn’t.

The key to reaching targets, according to Schultz, is to use behavioral as well as attitudinal data. “You can’t understand your return on customer investment unless you understand what they’re doing and why, and use that information to drive business strategy.”

A recent study-co-sponsored by Northwestern, Targetbase Marketing and Penn State’s Institute for the Study of Business Marketing-investigated what data is being collected by U.S. marketers and how it’s being used. Twenty- to 25-minute telephone surveys were conducted with marketing, information technology and senior management personnel at 218 U.S. businesses this past summer; 56% of the companies surveyed marketed to consumers and 44% to businesses.

“Few companies are getting both behavioral and attitudinal data and even fewer are combining it,” Schultz claims.

Schultz says the survey shows a definite link between a higher return on sales and the collection of transaction data: Eighty percent of the companies reporting a high return on sales (16% or above) capture transaction data, compared with 56% of those with a low or moderate return on sales.

Of the companies that capture customer data, 73% do so on an individual rather than a customer level; 83% reported customer service as a source of customer data, 81% sales feedback and 50% the Web.

Half the companies said their data was managed by the sales department and half by marketing. (Consumer firms were nearly twice as likely as B-to-Bers to have sales manage their data-49% vs. 28%.)

Marketers, says Schultz, tend to be proponents of attitudinal data, while salespeople are behaviorists. Successful database marketing, he adds, requires internal agreement and cooperation.

The problem, he says, can be that marketers using attitudinal data know why things happen but don’t know among what customers or prospects, or where or how. Those relying on behavioral data, on the other hand, know who does what, when and how, but they don’t know why. A third approach, combining both elements, is the key to fully understanding customers, prospects and the marketplace, he says.

Schultz presented the survey results last month at the Direct Marketing Association’s annual conference in San Francisco.