A little history
Some years back, I found myself advising clients that the consumer relationship is built at the interface, not in the database. Owning data “about” an individual was far from synonymous with having any kind of relationship with them.
That’s still true. Marketing's history with data has been a discourse between the vigorous claims of evangelists and a consistent failure, in almost all cases, to deliver the transformational value that, today, is still held out as being just around the corner.
It is not, however, just a matter of time. There is no circumstantial inhibitor; nothing technical, cultural or commercial is holding us back, except a long-standing, still-robust misconception, which we'll explore here.
A halo effect
When Peppers and Rogers became the anointed apostles of one-to-one marketing some 20 years ago, advertising as the key mechanism for building brands was already beginning to struggle. At the same time direct mail which, with the new databases as its foundation, soon morphed into the rather more interesting direct marketing, emerged as a compelling, many-birds-with-one- stone solution for marketers and agencies, whose power in their respective marketplaces had waned.
The customer relationship - then a startlingly new entity - soon came to be viewed as an essential molecule of business value. And data about the customer made up the atoms. A kind of alchemy emerged, one where this "rare earth" began to be energetically explored as a source of new marketing gold.
At the time, just possessing a correct address and phone number for an individual consumer was considered a significant victory. This was because the relative scarcity of accurate data combined with a fresh and invigorating sense of new marketing opportunity to bestow on that data a magical halo.
And that halo has never quite been shaken off, despite data's genuinely disappointing service record since those heady days.
A toxic tautology
This is not to claim that some of today's most remarkable businesses have not been built firmly on green fields of data: this is very far from a Luddite rant. And it is not to claim, equally, that the exhilarating citizen power that we have seen surge up, most notably during the Arab Spring, has not been founded on a new-found access and transparency.
But the magical promise of a marketing future blessed by data has in fact been built on a tautology. The blunt, too rarely-challenged assumption at its core is that data, in itself, has intrinsic value.
And in the early days, this was true, if its relative scarcity and novelty are factored in. But now both scarcity and novelty have gone, leaving us with just an infinite ocean of bits.
Those who hold onto the idea of the intrinsic value of data in the current context will be the most fervent, unquestioning advocates of Big Data.
But look closely at data in situ. Without a meaningful context, without a relevant hypothesis, without "work to do", it's nothing at all. Except, perhaps, the exhaust fumes of an ever-accelerating connected world, that may enable us to deduce by proxy "what just happened".
But it's the engine that matters, not the fumes.
When data delivers
Let me leave you with a case of where, how and, in particular, when and why data can create powerful, sustainable, defensible value. I think it gives us an excellent paradigm with which to go forward.
What Bloomberg, after we take away the brand, the mayor and its established dominance in its field, does is this. It buys data, does things to it, combines it with other data, and then - and this is the piece we need to get hold of - moves it to an optimal point in space and time, where it creates remarkable value. In Bloomberg's case, this point is of course a stock or share transaction.
Here's my point. The role and value of data remain entirely unrealised - not even remotely latent - until the time and place at which it enables a valuable transaction of some sort. It's from the value of such transactions, not from the data itself, that we can calculate where, when, why, how, and of course how much, we should be investing in our so-called data strategies.
Which are not, in the end, about the data: big, small or medium.