Have We Ruined 1:1 Marketing? How the Corner Grocer Became a Creepy Intruder
When Don Peppers and Martha Rogers wrote “The One to One Future: Building Relationships One Customer at a Time” in 1993, the Internet was a mere twinkle in Al Gore’s eye. But direct marketers felt excited, and even vindicated, about the promise of a future where data-driven personalization would deliver the right message to the right customer at the right time.
But now that it’s here, are consumers happy with it?
Recently, I had the students in my direct marketing course at Rutgers School of Business read the introduction to “The Complete Database Marketer” by Arthur Hughes, which was published in 1996 when only 22% of people in the U.S. had Internet access. In the intro entitled “The Corner Grocer,” Hughes explains how database marketing can connect marketers with their customers with the same personal touch that the corner grocer had by knowing all of his customers’ names, family members, and usual purchases.
The students then had to compare the 1996 version of database marketing, as described by Hughes, with the current state of online direct/database marketing, where data collection has been enabled by e-commerce, social media, and search engine marketing.
- What marketing innovations has technology enabled that didn’t exist before?
- How has online marketing enhanced the concept of database marketing?
- How have new marketing techniques and technologies changed consumer behavior?
- How has social media affected direct/data-driven marketing for the marketer and the consumer?
- What are some of the fundamental differences between the challenges and opportunities that today’s online marketers face vs. those that the 1996 database marketer faced?
Most of these digital natives were born after Hughes’s book was published. The students experience digital marketing every day, and they’ve seen it evolve over their lifetimes. While they concede that the targeted ads they experience are usually relevant, several of them noted that they don’t feel they have been marketed to as individuals; but rather, as a member of a group that was assigned to receive a specific digital advertisement by an algorithm. They felt that the idealized world of database marketing that Hughes described in 1996 was actually more personal than the advanced algorithmic targeting that delivers ads to their social media feeds. Hughes told the tale of Sally Warner and her relationship with the St. Paul’s Luggage Company that started with returning a warranty card and progressed with a series of direct mail and telemarketing. For example, knowing that Sally Warner had a college-bound son, St. Paul’s sent a letter suggesting luggage as a graduation gift. Hughes describes the concept of database marketing:
“Every contact with the customer will be an opportunity to collect more data about the customer. This data will be used to build knowledge about the customer. The knowledge will be used to drive strategy leading to practical, directly personal, long-term relationships, which produce sales. The sales, in turn, will yield more data which will start the process all over again.”
But Arthur couldn’t foresee the data collection capabilities of Google, Facebook, Instagram, and Amazon. Instead of the friendly corner grocer, database marketers have become a creepy intruder. How else could an ad for a product my wife had searched for at Amazon on her laptop generate an ad for the same product in my Instagram feed? (Alright, I will concede that we use the same Amazon Prime membership, but really?) We don’t have a smart speaker in the house, and I dread to think about how much creepier it could become if we did.
Recently, while visiting someone who has a Google Home assistant, I asked about the level of spying they experienced in exchange for the convenience of having voice-activated control over their household lights and appliances. They responded by asking, “Google, are you spying on us?”
The smart speaker replied, “I don’t know how to answer that question.”
Have we ruined 1:1 marketing?
Do you know how to answer that question? Tell me.