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VDP: Database Marketing Delivers

October 2007 By Brad Lena
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THE ADVENT of digital technology—in addition to forever altering the manner in which information is accumulated, stored, employed and disseminated—permanently altered the printing industry. Those printers wishing to respond to the consequent market demand for marketing communications that take advantage of these digital channels must become adept, if not specialists, in database marketing. This service requirement is distinct, but related to changes in workflow and printing capabilities.

In fact, those companies currently participating/competing in this market have developed a new business model. They have evolved from what I call a “print manufacturer” into a “print marketer.” The difference is that the manufacturer focuses on its customer. The marketer focuses on its customer’s customer, and that is where database marketing comes in.

Database marketing is information-driven. The information residing in databases is used to communicate via direct mail, Internet and HTML e-mail with a specific individual (or group) promoting relevant products and services. The issues that perplex companies wishing to evolve their service configurations and profit from this market are not technological, digital output/printing or software related, but rather operational, as represented in the following questions:

• Where do we get the data?

• How and why do we manipulate it?

• What is its value?

• What do we charge?

These questions are the “value-added” operations for data acquisition/manipulation.

The data in database marketing is obtained from the client and/or a data vendor. The type, amount, format and quality of client data vary. Some companies capture detailed transactional information, purchasing histories, product preferences, etc. Others have relatively little information. In either case, the data can be in terrible condition, rife with errors, inconsistencies, etc.

This is not a problem, but an opportunity, to sell file preparation/conditioning services. The cost can be a per-hour charge or a flat fee. Data vendors provide conditioning cleansing, deduping, postal sorting, and verification services in addition to list acquisition.

Appending demographic information to a client’s database is initially an analytic operation, developing and enhancing customer profiles. The more information a company has about who their clients are and what motivates them, empowers the company to offer relevant products and services.

A question I often get from companies starting to offer these services: “Where do we get the expertise?” I routinely recommend that they find a vendor/partner, rather than try to develop the IT/programming infrastructure internally. The learning curve is too steep, and it’s time-consuming. They need to bring the services to the marketplace as soon as possible and develop these other revenue streams.
 
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