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Audience Management
What is Audience Management?
It's the ability to track your audience and customers, know who they are, what they like, how they behave, etc. Done right, it can allow a business to improve its relationship with its customers and potential customers. Businesses have been doing audience management forever. It's probably one of the most critical aspects of a well run business.
One of the great things about the Internet is that its turns audience management from an art into a science. If you have one or more Internet channels for your business (websites, email campaigns, etc) you can do audience managment.
You can collect data from your customers with their permission. The simplest thing you can do is collect email addresses. Back in 1996, when Seth Godin walked me through the whole concept of Permission Marketing, i was sold. I invested in his company Yoyodyne and enjoyed an early taste of Internet-based audience management.
Most businesses with an Internet channel collect email addresses and use them to talk to their customers. But an email address just isn't a lot of information about a customer or potential customer. You can ask them to volunteer more information about themselves. One of the best ways to do that is to force them to register. Online stores can do that as part of the checkout process. Non-commerce sites can do that by requiring registration. A lot of online publishers are adding forced registration as a way to improve their audience management.
But what do you do with all of this data? That's where audience management systems come in. These systems allow you to database all of this information and use it to do interesting things with it. It's a new emerging market with only a couple of companies selling audience management systems today. I am an investor in one of them, Tacoda Systems, which is the leader and creator of this market space.
Over time, I expect this market will turn into a very large and profitable business. Why? Because marketing is moving from a push/stupid model (buying super bowl ads) to a pull/intelligent model (Amazon knowing i like Dave Matthews and alerting me to his new album). This move is big and its happening in real time and will change the landscape of business as we know it. And audience management is central to this change.
I am interested in Audience Management because of my investment in Tacoda, but also because its a big deal. And i am going to write more about it. There's a lot of exciting things happening in this market. So stay tuned.
Comments (5) | Posted October 15, 2003 in Venture Capital and Technology
Comments
I fully agree that the move towards more intelligent, customer-centric marketing will be the high ground for marketing in the future. Smart companies will definitely be looking at Tacoda and similar solutions to help them get over the technological hurdles.
At the same time, two other factors are in play:
1. As tradition, interruptive marketing techniques are declining in effectiveness, most marketers are deciding to be even MORE intrusive, rather than less. Overly aggressive marketing is poisoning the well for well-meaning marketers and customers are becoming VERY leery of offering any information without clear benefit.
2. Companies that do look to audience management often fall into a trap of working to fill the database instead of a customer need. Companies need to remember that delivering real customer value is the key to success and audience management / measurement needs to align with the goal of delighting customers. I'm amazed at how many CRM implementations end up forcing customers to give up information before they are "allowed" to buy or interact with the company.
Posted by: Ken Schafer | Oct 15, 2003 5:26:39 PM
I like the buzzword "audience management" a lot. We've been doing that for a long time with VentureReporter.net where we use a "give a little data to get a little data" strategy. We offer free VC and M&A deals if you answer some questions. We then offer other free research if you fill our surveys. We then have that info dumped into the sales system (or I should say linked into), and our sales people upsell those folks on our paid products. The road to paid is paved in free.
Posted by: Jason Calacanis | Oct 15, 2003 10:25:12 PM
I agree the future is getting less "dumb". The other funny thing is the basic Madison Avenue ad agency biz model hasn't changed one iota in 30-40 years. Proctor & Gamble would LOVE to be able to do without traditional advertising... so far the internet hasn't come up with a way of marketing cheap soap and toothpaste effectively.
Posted by: hugh macleod | Oct 16, 2003 1:46:26 PM
Re: the unchanging ad agency model and P&G's desire to do without traditional advertising. . .
Nowhere was this more evident than at the recent Advertising Research Foundation conference. A speaker from Kraft claimed that the packaged goods company publishes the single largest circulation magazine in the US. It's a Kraft custom publication mailed monthly to their database in more than 30 editions (language, lifestyle, geo, food groups, etc.).
Even in "old" media, marketers are taking control from agencies AND publishers and handing it back to the boss - the consumer.
This works most efficiently online, of course, yet only this year did the ARF finally acknowledge the existence of response/results as part of the official Media Model. This is the first wholesale revision of the Media Model used by the big agencies since the early sixties!
Audience Management enables marketers to engage groups of like-minded consumers in much closer and more meaningful communications than mass advertising ever could.
Posted by: Bennett Zucker | Oct 19, 2003 11:46:53 AM
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