How Marketers Seek Out Data about Their Prospective Customers in Creative Ways to Learn the Target Market Better - Essay Example

 Marketing Big Brother Although demographic information on large numbers of consumers is used in many marketing contexts, some people believe that the sale of data on customers' incomes, buying habits, and so on constitutes an invasion of privacy and should be stopped. Is Big Brother watching? Comment on the issue from both a consumer's and a marketer's points of view. In the modern world, technology comes into use for business in many different ways but regardless of the technology used or the business where the technology is being applied, the primary motive for the application of technology is to improve the efficiency of business and to make a company more effective than it is. For example, demographic information about a large number of consumers is utilised in the context of marketing by creating related databases and this application of technology which is now being helped by the most modern tools such as RFID tags (Fitchard, 2005). The collection of this data can be shared with other marketers to compile complete reports on individual customers buying habits, incomes and other information that can be deemed private data. However, this approach has been criticised by many as being close to Orwell’s Big Brother and there are two different viewpoints that are taken on the subject. The business applications for information collection become obvious when we consider how such data can be used in the retail industry as well as other situations where marketers need to know all they can about the target market. On the other hand, there are strong privacy issues and legal questions regarding the security and the protection of the collected data from prying eyes as well as preventing the use of the data by nefarious individuals or companies. In such situations, it becomes important to look at both sides of the argument before we can arrive at any conclusion. While privacy advocates and some consumer support groups may say that marketers and advertisers already have too much information about their buyers and individual tastes. As reported by Galician (2004), online retailers such as Amazon.com have access to large amounts of information about their customers and can make predictions about their individual tastes. Businesses as well as marketing professionals suggest that they can never have too much information for their information systems (Levy and Powell, 1998). In fact, they go as far as to say that the information they have is not nearly enough to provide a level of service which they aspire to and much more is needed (Williams, 2004). The need for information with regard to marketing is painfully obvious and the ways in which information about a customer or a large group of customers can be used depends only on the imagination of the marketing company. This is certainly no secret because businesses have known for decades how a rise in the level of information means a reduction of risks as well as an increased level of opportunities (Knight, 1921). In fact, that is the idea which leads us towards becoming a society where information is a competitive advantages for running a successful business (Prakken, 2004). For example, knowing that a large number of electric fans have been sold in a given area within a short span of time can prompt a marketing manager to consider advertising for air conditioners for houses that have bought fans but feel like moving up in the world. Of course there is no reason why the marketing manager who has all the information about these customers can not sent them a personalised letter with their name and address offering them discounts on buying an air conditioner. In fact, such information may be useful and quite helpful for those customers who are seeking to improve the quality of their life and the comfort of their home. While a marketer may seem to be collecting more or less useless information from an individual, the information when combined with the other sources available to the market can result in business statistics which show things such as Apple’s iPod being the most popular MP3 player in a given category of such devices (Beckman. and Hirsch, 2001). The marketer’s perspective on collecting information is quite clear. Discussing the plans made by large discount sellers in America, McClenahen (2005) suggests that exact data on the customers purchase decisions is extremely important from a business perspective since it allows the seller to function as a better business. Knowing what the customers bought at what time allows them to be offered complimentary and ancillary goods which would help the sales of the seller and the lifestyle of the buyers. For the marketers, the collection of information as well as additional business generated by the collection of customer’s data seems to result in a win-win situation. In fact, marketing as well as business professionals seem to grab on to anything which will give them more data about their customers. Williams (2004, pg.1) reports that, “The allure of knowing how, when and from what shelf or end goods were purchased and the spatial relationships to other purchases will drive demand for a new generation of merchandising strategies”. Such strategies could lead to an efficient and effective marketplace which could actually guide the shopping experience. For example, as soon as a person put together toothbrush and toothpaste into their shopping cart, an LCD equipped panel on the newly created digital powered shopping cart could show them an ad extolling the virtues of liquid mouthwash. This sort of information seeking and use of information may not be limited to large companies since as suggested by Young and Francis (1993) as well as Rupley (2005) small organizations also need customer related information to further their business. In a way, such measures may become necessary given the bombardment of advertising and marketing that people experience throughout the day. Petrecca (2006) is of the opinion that having information about customers is the only way which can make a message stand out amongst the thousands of others that a person is exposed to on a daily basis. She says that, “The industry is desperate to find clever ways to reach people, whether or not it has any legitimate value. When someone says, 'Let's put advertising in bathroom stalls,' another says 'Great. It's a captive audience' (Petrecca, 2006, Pg. 1)”. Under such circumstances, it is clear that marketers would be hungry for information which lets them know if their message is reaching the right market. Of course, product placement and establishing connections between the product and the individual to whom the product is being marketed to depends on what the sellers know about their buyers. For example, marketers have to know what segment of the market is watching certain shows and where they are located and what they prefer to eat and even how their tastes have changed over time. The more information they have about the buyers, the better they can sell their product and services. In sum, the viewpoint of the marketers is that more information about the buyer is better for all concerned parties and could benefit everyone in the business cycle. Some companies such as google.com and others may seek to find out information about their clients by virtually sniffing through their email as employers can do with employees (Barker, 2005). Even the comment cards of shops like Starbucks or even McDonald’s can seek information such as email addresses of their customers with which a customer can be made special offers. On the other hand, the approach taken by some customers, privacy advocates and consumer groups is completely the opposite (Rohde, 2004). They suggest that the sale of customer’s data is unethical, invasive and since information has to be kept safe and secure regardless of the type of information it is, sharing such information for business purposes is a breach of trust (Pethokoukis, 2005). Some writers seem to suggest that advertisers and marketers already have too much data about buyers and this is reflected in all the new places where advertising pops up in these modern times. The facts show that advertising has become more invasive than even and this is exemplified by in America where the average American urban dweller sees between 2,000 and 5,000 messages today. In the 1970s the figure used to be less than 10% of the present value. The next generation of Ads could come onto iPods, mobile phones and video games as a part of personalized marketing (Petrecca, 2006). Since mobile devices also carry vast amounts of personal and private data that could possibly be used in advertising, there are definite concerns about marketers getting too much information about the customer. Not only the volume of information, but also the tools used to collect information about the buying patterns of customers have been questioned in terms of privacy concerns. The use of RFID tags has already placed one retailer from Britain in trouble. Benetton had to pull back from its plans of embedding RFID tags into clothing items when it was threatened with a boycott from consumer bodies (Williams, 2004). A simple search on the internet shows that there are significant questions which are being raised by many individuals who may either be ignorant of the use of such data collection methods or even genuinely concerned about personal security threats (Rohde, 2004). It is doubtful if everyone could be comfortable knowing that a person with a handheld RFID reader could learn about the contents of a shopper’s car as s/he returns home from a trip to the local supermarket. Even marketing professionals and business analysts such as Pruitt believe that some companies may be going too far in trying to capture information from their client. With regard to the use of RFID tags in collecting customer information and transferring it to the company’s data base, he writes that: “Concerns have been raised that the tags could encroach on shoppers' privacy. RFID tags left activated on merchandise could possibly allow customers to be tracked, they say. Privacy advocates also fear that tags, which store information like purchasing histories, could be read without the consumers' knowledge (Pruitt, 2004, p. 2)”. Such approaches to collecting data might border on the extreme and given that the government and other regulatory bodies have laws in place to protect the privacy of individuals, such concerns may even be outlandish. However, what must be noted is that these concerns are there and they need to be addressed by the sellers who believe that they are doing the right thing by getting information in any way possible and then sharing it with whoever gets them the best price or the highest level of returns. In conclusion, the situation for the marketers of the world appears to be desperate. They need to get their message out to millions of people yet they would like to have targeted information about every individual who sees the marketing material that they have to show. They need to know the person’s age, occupation, buying habits, personal disposable income and every other thing which will allow them to judge whether the marketing material will appeal to them. More importantly, they need to know the likelihood of that appealing marketing material resulting in a sale through a purchase decision made by the valued customer who is already reeling under the weight of other decisions which need to be made based on other marketing messages. For companies such as Starbucks and McDonalds’ that depend on customer loyalty, any information about the customer is a valuable commodity. Therefore, marketers seek out information about their prospective customers in creative ways. Whether they run contests, organise shows or offer huge prizes for filling out questionnaires, they will continue to do so because they can not create their material without knowing the target market. If the sale and sharing of this collected information is questionable, they will continue to do it until the question is answered in a firmly negative manner by the government or by the public themselves. At the same time, some members of the public appear to have genuine concerns about what marketers will do with their information and how that information will be used (Rohde, 2004). Income levels and buying habits are certainly private data especially for those who wish to protect themselves from Big Brother and such demographic information may have no acceptable use for them in any marketing context. As consumers, people may think that junk mail is nothing more than a nuisance, but personal phone calls offering cheaper long distance services in the middle of a family dinner can be quite infuriating and even be cause for concern as an invasion of privacy. Particularly, when the person on the other side of the line will not take a polite ‘no’ for an answer and comes up with all sorts of information about where the consumer has been calling in the past seven years. That is something can be very scary and it could certainly makes many individuals hope that their telephone records are secure enough not to be shared with any marketing professional. Information is power and giving someone information about me seems like a loss of a powerful position where Big Brother knows everything about the consumer. Perhaps the marketers of the future could come up with ways to pay individuals who divulge personal information while keeping others who do not also a part of their target market. 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Williams, D. 2004, ‘The Strategic Implications of Wal-Mart's RFID Mandate’, Directions Magazine, [Online] Available at: http://www.directionsmag.com/article.php?article_id=629&trv=1 Young, C. and Francis, A. 1993, ‘Innovation, high-technology use, and flexibility in small manufacturing firms’, Growth & Change, vol. 24, no. 1, pp. 67-83. Read More