Online data capture has eased the burden of keeping customer databases accurate, but brands still cannot afford to be complacent about their lists, warns Robert Gray.
The devil, as they say, is in the detail, and for direct marketers, it is devilishly tricky to ensure that the data on which their success depends is of sufficient quality. Inaccurate information can cause wastage and a poor return on investment. Worse still is the potential antagonisation of existing customers.
With a multitude of data being generated from myriad sources, keeping on top of it all is demanding. It is estimated that 10% to 20% of mailing lists are out of date. And if lists are not regularly cleaned and updated, effectiveness plummets.
'Some lists will have a higher percentage of old data than others,' says Scott Logie, managing director of data strategy firm Occam, and deputy chairman of the DMA Data Council. 'It depends on where and when the list is sourced, how often it is cleaned, and if it is regularly suppressed and updated.' It is vital not to assume a list is perfect. 'People move house every day; no list will ever be spot-on,' Logie adds. 'And people change their habits, opinions and purchasing decisions regularly.'
Occam encounters many lists that are assumed to be clean but which actually contain poor-quality data. However, he claims it is rare that such lists cannot be cleaned in order for them to be used without fear of inflicting brand damage.
Data collected via the internet has many advantages. It allows clients to take control of their own databases, helping to reduce their reliance on lists. If mined more deeply, it offers rich data to marketers 'People have changed their buying behaviour. More and more people are going to the internet to compare costs, sizes and styles,' says John Wallinger, database director at Craik Jones Watson Mitchell Voelkel. 'Using the web as a hand-raising tool is important. We use lists, but less so. Budgets are moving online, and the audience is warmer there.'
Appealing to this 'warmer' audience is the approach preferred by Honda in the UK. In the past, it has used cold lists based on surveys, but it now prefers not to use lists for cold prospecting wherever possible. Even with surveys that ask 'When do you intend to change your car?', Honda has found responses at odds with reality.
Neil Fretwell, data director at relationship marketing agency Hicklin Slade & Partners, manages Honda's prospects and customer database, which includes everyone who has made contact with the company via a list or an enquiry. '(We write to prospects) regularly to check and recheck that the information we hold is accurate,' Fretwell explains. 'We will know if they are driving the same car as six months ago, and whether they still intend to change their car in the next six months.'
Like many brands, Honda uses digital channels to update its information, finding it cost-effective and efficient, with email the preferred contact method. Mick Doyle, Honda's manager of customer understanding, says there is a focus on obtaining as many email addresses as possible through its dealership network. Information is kept on a central database and all communication is coded.
The car maker prioritises two questions: when are you going to change your car, and what model are you currently driving? Fretwell says this simple approach is useful in a data-heavy world where 'far too many brands waste time chasing the more irrelevant bits'.
Yet for all the advantages of online data collection, there is also a downside. Logie argues that consumers' use of 'spoof names' is on the rise, in part a backlash against excessive online form-filling. This should be taken into account when formulating data-capture plans. Logie adds that many in the data industry need to be 'more intelligent' at formulating means of identifying web users. For example, the capture of date-of-birth information could be prioritised via a pop-up window. …