The list business may have its problems. But all of them can be solved by creative use of data and a more strategic role for brokers.
Or so Donn Rappapart said yesterday during ALC’s “For Brokers Only” luncheon in New York.
Rappaport, the CEO of ALC, argued that the industry is at a “dangerous but thrilling crossroads,” and that it faces several threats.
One is the “outrageous” postal increase that takes effect on May 14, and the chance that there will be another one in 2008 before reform kicks in.
Another is the fact that privacy advocates are pushing for a national do-not-mail list.
Finally, there are the internal challenges within the business. For starters, some mailers are cutting their prospecting volume and investing more on house lists, co-op databases and the Internet.
And some clients are “expressing doubts about our value,” Rappaport added. They look at list management and brokerage commissions when they have to cut costs.
And yet “the opportunities are great” he continued.
For example, a firm like Eddie Bauer can use data and modeling to better serve customers and remove the advantage of online competitors that sell on price. And list brokers can help it do that.
“The route to successful modern marketing is data,” Rappaport said. “It’s about bringing buyers and sellers together in an environment conducive to selling.”
But he warned that list professionals have to abandon their tactical mindset.
“Why are we boxed into a technical and administrative roles instead of strategy?” he asked. “Why can’t we take a strategic place at the marketing table? If we get so tied up with the technical part of our jobs, clients can’t help but see as a commodity.”
And why aren’t list firms taking the lead in e-mail instead of ceding it to warmed-over dot-com gurus who really know little about direct marketing?
Here’s one more question: Isn’t there a better way to get paid besides commissions based on volume?
Rappaport recalled that the started his career as a copywriter at the Marsteller agency. When doing direct mail, the creatives poured over every word and art element, but never gave “a thought to the list we were mailing,” he said.
But Rappaport made it its business to learn about lists. He sat down with the agency’s list broker, who carried data cards around in shoe boxes, and eventually ended up in the business himself.
His advice to marketers?
“Data is not something you check off on a checkoff sheet when you’re done with creative strategy,” he said.
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