Trust

Fundamentally, modern marketing is all about finding a group of people with something in common and tailoring your business to their wants and needs.  Done right, it is much more efficient than mass marketing, and results in the marketer and client often having shared interests and values and a "relationship" beyond the transaction. 

As our personal lives and business lives become more data rich, marketers have adopted increasingly sophisticated approaches towards gathering and analyzing data.   Their goal of course is to improve their offerings and their communications and to sell more with less invested.  The catch is that as people we don't know have access to more and more information about us and our families, it can start to feel a bit "creepy."

There is an interesting article in Smart Money that looks at how nonprofits are increasingly using data-based marketing techniques and more and more information about potential donors.  The article is titled "Are Charity Fundraisers Spying on You?"  The answer of course is "Yes," but the fundamental questions are "How do we feel about this?" and "How should responsible marketeers behave?"

When your favorite nonprofit isn’t busy saving the whales, chances are it’s making a serious behind-the-scenes effort to know you better—and using increasingly sophisticated technology to do so. Whether it’s the local museum or an international relief group, a charity’s prospect-research staff can survey your salary history, scan your LinkedIn connections or even use satellite images to eyeball the size of your swimming pool. And if it’s really on the ball, it’s keeping better tabs on your financial life than you are. Should your stock holdings double, your friendly fund-raiser can get an e-mail alert prompting her to make an impromptu call...

Data is playing an increasing role in when, where, how and with whom marketers seek to create relationships.

...the rising tide of data on hand can speed the getting-to-know-you process. Suppose a fund-raiser gets a candidate’s business card at a cocktail party. The next morning he can download an instant report on his new prospect from data providers like Blackbaud or WealthEngine. The summary starts with a simple numerical score assessing the prospect’s net worth and whether she’s likely to donate. But the details in these reports, which can run past 10 pages for a top executive, can include a prospect’s career history and education, stock holdings, pension, charitable-giving history and campaign contributions. If she owns a plane or a boat, it’s in there, along with the names of family members and board cronies.

There is no doubt that when done right, data-based marketing can be very effective.  It is also a tool that can be misused.  Beyond the obvious privacy issues that all of this data aggregation raises, there is the "creepiness factor."  At the heart of this creepiness factor is the issue of TRUST.

Does it bother me that my financial advisor knows my investment portfolio?  Of course not, we have a relationship built on trust.  Does it bother me that some random telemarketer knows it too?  Yes, it feels downright creepy. 

Relationships are built on trust, not information.  Our friends aren't necessarily those who know the most about us, but those who have earned our trust.  Information tools are invaluable in the marketing tasks of segmentation, targeting, and positioning--finding prospects and creating an offering--but it is important to remember that customer or client relationships are built on trust. 

Successful luxury agents are good target marketers.  Of course few are doing the type of intensive data-mining or data-driven marketing discussed in the article.  Nonetheless, in our increasingly data-rich world of market research firms and social media, it’s a point worth remembering.  I think we’d all rather be trusted “friends," not “creeps.”