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DMA Announces Finding that Small Business Is Big Winner in Data-Driven Marketing Economy


Post Date: December 17, 2013
By: Susan Taplinger

DMA-Commissioned Study Shows that Innovation and Small Business Depend on Data Flows to Reach Customers and Benefit Consumers

Washington, DC, December 17, 2013 – In the wake of a record-breaking Small Business Saturday, a study commissioned by the Direct Marketing Association’s (DMA) Data-Driven Marketing Institute (DDMI) found that small businesses and innovation are the biggest winners in the Data-Driven Marketing Economy (DDME).

The Value of Data: Consequences for Insight, Innovation, and Efficiency in the U.S. Economy” shows that the exchange of data across the Data-Driven Marketing Economy enables small businesses to compete effectively with big players, launching innovative publications and services fueled by advertising revenue.  This first-of-its-kind study was commissioned by DDMI and undertaken by Professors John Deighton of Harvard Business School and Peter Johnson of Columbia University.

“Thanks to data, startups and small businesses today face lower barriers to market entry than they have since the 1870s,” said DDMI Executive Director Rachel Nyswander Thomas.  “Data also gives small businesses a leg up in matching of products to customers.  Data-intensive market insights are now more accessible to mid- and smaller-size enterprises than ever before.  The emergence of specialized data providers, supplying derived or ‘modeled’ data, makes it easier for startups to create specialized niche offerings.  The benefits of the data revolution are being distributed across the entire economy – from the biggest brands to the smallest startups.”

DMA also warned that well-meaning but poorly conceived legislation restricting the responsible use of data could stifle innovation and make small businesses less competitive.  “The biggest winners in the DDME – innovation and small businesses – would also be the biggest losers if startups could no longer use data to overcome barriers to entry, raise ad-supported revenue, and identify new and niche markets to serve,” said Peggy Hudson, DMA’s senior vice president of government affairs.  “In the end, it would hurt consumers by limiting choices and raising prices.”

Small Business Saturday is a program created by the Small Business Administration to encourage consumers to support their local small businesses. According to the National Federation of Independent Businesses (NFIB), consumers spent $5.5 billion at independent retailers on Small Business Saturday this year.

About Direct Marketing Association (DMA)

The Direct Marketing Association (www.thedma.org) is the world’s largest trade association dedicated to advancing and protecting responsible data-driven marketing.  Founded in 1917, DMA represents thousands of companies and nonprofit organizations that use and support data-driven marketing practices and techniques. DMA provides the Voice to shape policy and public opinion, the Connections to grow members’ businesses and the Tools to ensure full compliance with ethical and best practices as well as professional development.

In 2012, the Data-Driven Marketing Economy (DDME) added $156 billion in revenue to the U.S. economy and fueled more than 675,000 jobs.  The real value of data is in its exchange across the DDME:  70 percent of the value of the DDME – $110 billion in revenue and 478,000 jobs – depends on the ability of firms to exchange data across the DDME.

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