This week I am going to take an unusual step and disagree with our esteemed news editor, Russell Parsons, who argues that direct marketing (DM) needs protection from impending data legislation. Whether marketers like it or not, change is coming and they should innovate rather than burying their heads in the sand.
Amendments to EU data protection laws are scheduled to be revealed by March. Many predict that the proposals will include a requirement to seek an opt-in from consumers for any DM.
Going by the precedent of the EU’s electronic privacy directive, also known as the ‘cookie directive’, any such suggestions are likely to be watered down before passing into law. But whether they happen or not, marketers should start moving in this direction anyway, rather than be dragged kicking and screaming.
In the next decade technological shifts and the explosion of customer data will mean a paradigm shift for direct marketing. It has already begun.
DM will need to be measured universally by value, not volume. Campaigns are becoming more data-driven and the relevance of communications to individual customers is going to be paramount. The data means campaigns are also becoming more accountable in terms of the sales they generate and costs they incur.
In that world, marketing to a consumer who doesn’t want what you’re selling is as negligent as throwing money down the drain. If the only reason you’re targeting them is that they can’t be bothered to opt out of DM, that will be a poor choice of sales prospect.
In future, marketers will not be able to afford to spend extravagantly on unaddressed mail, because their budgets will be directed into more responsive DM channels that generally need an opti-in to work. An example is targeted mailings that use behavioural analytics – purchase data collected from loyalty cards can tell brands what a customer is most likely to buy and when, making a response more likely.
Online behavioural targeting is also set to change gradually as cookies come to seem an outmoded technology. Rather than each ad network putting a different cookie on a web user’s browser, which can be readily deleted, advertisers are beginning to build up unique profiles of each connected device, tracking web use and targeting ads in that way.
This data remains reliable to advertisers indefinitely, rather than just until the user deletes the relevant cookies. This is more efficient and also wastes less processing power on the user’s machine.
It means too that if a consumer opts out of online marketing, it is remembered forever, so marketers are going to have to get used to focusing on the relevance of DM. Hoping consumers won’t opt out is a bad strategy. Realising the value of data from customers who opt in is a better one.
So rather than expending all your efforts lobbying against data protection regulations and delaying the inevitable, why not steal a march on the competition? Put data at the heart of all your DM and start thinking in terms of the value of every message, rather than the volume of messages you send.