Neil O’Keefe is DMA’s SVP of CRM & Member Engagement

Cities around the world are following the lead of the marketing industry, investing in data and technology to create efficiency and effectiveness in hopes to fuel growth and insulate themselves against economic downturns. LA exemplifies those initiatives whether it’s the exploding Silicon Beach scene, the revitalization of downtown LA via LA Live or Mayor Eric Garcetti’s personal involvement in initiatives like Hack for LA.

Marketers across the U.S. are continuing their investment in data and technology, but like smart cities they also are beginning to brace for an economic downturn. Unless your head has been in the sand, you’ve noticed significant volatility in the stock market, a collapse in the oil markets and less than stellar quarterly reports from the retail sector. In the recently released DMA / Winterberry Quarterly Business Review (QBR) survey, only 51% of marketers showed confidence in the state of the U.S. economy and as many as 45% were only “somewhat confident.” As a result, marketers are shifting from customer acquisition (down 10% quarter-over-quarter) and directing an increased share of their marketing spend toward customer retention efforts. I’m a sports guys and in my mind, that’s a pivot from offense to defense.

Despite economic insecurity and protecting their “customer end zone,” marketers have not soured on the technologies and strategies propelling the growth of their businesses today, and they’re relying on marketing efforts fueled by data to hedge against a downturn. The same QBR shows that over 72% of responding marketers believe that the data-driven approach that they have taken will continue to grow in the future.

Why are marketers so loyal to the data-driven approach? Because they are seeing benefits of strategic data use, not only in their own businesses, but also in public advancements in cities and countries around the world. With the progress brought on through data-driven strategies, marketers are confident in the ability of data to carry them through potential rough economic times.


Peter Drucker

Data Fueling Marketing Efforts

What kind of marketer is today’s MARKETER? A digital marketer? Brand marketer? Direct marketer? Data-driven marketer? We are all of those things. We are MARKETERS in a digital world. We are marketers who communicate directly with our customers and listen to them when they communicate directly to us. We are MARKETERS who embrace all channels from print to email to social to mobile to the internet of things. We are MARKETERS in a data-driven marketing economy and that Data-Driven Marketing Economy (DDME) is growing.

According to a newly-released DMA-commissioned study, the DDME contributed nearly 1 million jobs to the United States in 2014, and added $202 billion in revenue to the U.S. economy. The new research, titled “The Value of Data 2015: Consequences for Insight, Innovation & Efficiency in the U.S. Economy,” builds on the seminal Value of Data report released in 2013 and quantifies the growth in the data-driven marketing economy. The DDME saw a 49% increase in jobs and 35% growth in revenue between 2012 and 2014. By comparison, the U.S. economy grew at just under 3% in the same time period.

Report authors Professor John Deighton (Harvard Business School) and Dr. Peter Johnson (mLightenment Economic Impact Research and recent Columbia University professor) provide an academic explanation for how data is driving value for marketers:

Data makes the expensive medium of hard copy mail less expensive by allowing target selection based on analysis of individual response rates of prospects and customers, while data makes the inexpensive medium of email more expensive, but more effective, by making it possible for opted-in recipients to be more engaged in its content. In these ways data changes the economic equation for many marketers in favor of data-driven marketing and media.

Using data to drive your marketing is doing things right. Using data to determine how much print versus email and making each of those channels more relevant and more engaging to the consumer is doing the right thing.

Data Fueling Public Good

On the recent PBS documentary The Human Face of Big Data, Jennifer Pahlka (Code for America) made the point that capture of big data can result in two conclusions by the consumer:

  • “Big data could be interpreted as Big Brother ‘listening in’ or that ‘someone is really hearing me.’”
  • Unless marketers do the right thing and use data to become more relevant consumers will never feel like we ‘hear them.’

Pahlka continues that “when you can query the data in an intelligent manner you can prioritize limited resources.” Her example pertained to a local government addressing broken streetlights and crime prevention, but the example can easily be extrapolated to address customer attrition. Therefore, as the DMA/Winterberry QBR leads us to believe, more marketers will put a priority on data-driven methodologies to retain existing customers. In a downturn, this will force marketers to decide between staffing and technology.

The documentary also highlighted the lives being saved through the creative uses of data. Dr. Carolyn McGregor of the University of Ontario’s Institute of Technology used data gathered from the hospital’s medical monitors to monitor for and stop infections in premature babies before high-profile warning signs developed. Her former experience as a banking and retail consultant made her uniquely equipped to analyze and interpret the large samples of medical data that previously went ignored. “Today, [Dr. McGregor’s Project] Artemis allows doctors to see early warning signs of infection upward of 24 hours before the baby would have otherwise shown any other symptoms,” according to CNBC.

Tech and media entrepreneur John Battelle called out the fact that “the ability to turn data into actionable insight is what computers are good at, and the ability to take action is what people are really good at.” Therefore, while we shouldn’t fear being replaced by technology, we need to maximize where technology and data can drive efficiency and reallocate people to taking action that improves effectiveness.


Data Fueling Cities

According to a recent article in GovTech, LA’s Chief Innovation Officer Ted Ross, LA Mayor Garcetti and Deputy Chief Data Officer Lilian Coral are intent on improving LA in a data-driven manner. Mayor Garcetti explains that to run a city like LA with data-driven insights, “you need to have numbers, you need to measure and you need to have priority outcomes.” That all translates into Data to Insight to Actions.

“We live in an era of the Internet of Things,” Mayor Garcetti goes on to explain. “There are 6 zettabytes of data in the world and it’s doubling every two or three years, which means a whole host of information is available. If you can harness that data wave, then you can start to leverage it to create real insight and real information. So from our perspective, we see tremendous opportunities with sensors in the streets, with traffic information — with real-time information on all sorts of city services. If we can leverage it to get a better insight, we’ll be more efficient and we can deliver a more effective service for the citizens and businesses of Los Angeles.”

What LA and other cities are doing for their citizens, DMA members like Conde Nast, IBM, OgilvyOne, American Express, Pitney Bowes and Media Math are doing for their customers. DMA members are marketers powering their strategy with data-driven tactics. These marketers fuel the data-driven marketing economy and in California alone drove increases in data-driven jobs from 89k in 2012 to over 128k in 2014.

In Los Angeles from October 16-18, DMA will host its members and thousands of other data and marketing companies at &THEN, DMA’s Annual event. Together these companies will be sharing knowledge on how to grow efficiency and improve effectiveness.

During DMA’s February 3rd launch of the Value of Data Study at the National Press Club in Washington, DC, DMA member Denis Dayman of Return Path pointed out that the DDME is still in search of 200k jobs and especially jobs focused on understanding and applying data for creative applications and solutions. So despite an anticipated economic downturn, marketers continue to invest in efficiency and effectiveness, and their ability to use data strategically. Where other industries might retreat against the backdrop of a softer U.S. economy, marketing isn’t.

Together, data and marketing are changing the world. And, wow, isn’t it awesome to be part of an industry that’s forging forward!

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