This weekend I finally completed the arduous process of buying and selling a home and was sharply reminded of how much work is involved in moving the contents of an entire house. Ever been too exhausted to sleep? I can relate.
The other night, in preparation for the impending move, I disconnected my washing machine and it turned out to be a far messier project than I could have ever guessed. I had done this several times in the past so it was seriously not a bit deal in my mind. I turned off the taps and grabbed my monkey wrench and unhooked the hot hose. All good. Then I started loosening the cold hose and that?s when things went down-hill.
As I loosened the hose, water started coming out. I thought to myself, no big deal, there's probably just some built-up pressure in the line and I'll just drain it out. But as I kept loosening it, the more the water started spraying. Water, everywhere.
Now, the smart thing to do at this point would be tighten the hose back up and reassess the situation. But I wasn't so smart that night. I just kept trying to loosen the hose, while trying to funnel the spraying water away from my face and into the drain with my free, cupped hand. All the while, saying to myself the cold tap is off. I even reached up again and tried the tap and sure enough. It seemed tightly closed.
After spending a few minutes being stubborn like this, I finally relented and said to myself, dude, the tap is still on. There's NO WAY there was this much water in the hose. So I stopped trying to fight the water, took some more water to the face and cranked on the tap and with some serious elbow grease, sure enough, it gave. It was just stuck. So, I proceeded to close it off and finish the disconnection and then set about cleaning up my mess.
Later that day I got to thinking about how ridiculous all of this was. Due to my stubborn belief that the tap was closed (and I was completely positive that it was closed), I kept pursuing a course of action that was not only unproductive but was also detrimental. I got to thinking and realized that marketers, especially in the financial services space do this sort of thing all the time. Specifically, they take actions with, or based on faulty data and barrel ahead, despite evidence that they're headed in the wrong direction.
On a corporate project level, this happens all the time. You've seen the headlines. All the big banks and wealth management firms have done it. They spend millions and in a few cases billions on a project, just to realize that it's not going to work and scrap it. On a marketing campaign level, it may not be to that scale but throwing money away due to inaccurate data can indeed get up into the seven-figure range on occasion.
The most common example of this is when finservs put together a product-based marketing campaign and send it out to everyone, including the customers who already have that exact product. A couple of the biggest offenders of this are Citi and Capitol One with their credit card products. One day I received three direct mail pieces (all on the same day) from Citi, all for the same, exact credit card; a credit card I already owned. All three were sent to a slight derivation of my name at my address. When you consider the cost of direct mail and think about how many of these pieces are sent to either people who already have this product or to people who don't even exist, the price tag for dirty data can be staggering.
It's not just direct mail. Financial services companies are flushing millions down the drain in display advertising as well. The money they're spending on display in 2015 is projected to be over $7 billion and I have to ask how much of that is being spent to market to existing customers, or competitors, or other segments or audiences who will never buy the product or service that they're being offered in these ads.
It is of course happening also in the traditional email channel as well. How many email campaigns that financial institutions are deploying are being sent out to upstanding investors like Mickey Mouse or Bruce Wayne? I promise you, it's a frighteningly large portion of the campaigns.
So to get back to the water-in-the-face subject of proceeding on faulty data, why does it happen so often in digital marketing? After all, the tools to create a contact washing machine have been around for over a decade. On the display advertising front, there are data tools out there that solve the exact problem of marketing to prospects with an extremely low propensity to buy. So with all of these tools at their disposal, why is it still happening so much? especially in the financial services space?
My opinion is that even though these institutions have been around longer than most companies and know the financial services world through and through, they're generally not on the bleeding edge of change and technologies. They're traditionally slow to adopt change and marketing is no exception. Another reason would be the siloed nature of these organizations. The marketing operations folks in these orgs who are getting good at leveraging current technologies and strategies generally don't own the process or budget for display advertising, direct mail or other channels. These functions and budgets are usually siloed within business units or product marketing.
What are your thoughts? What do you see is the main reason these companies continue to waste so many marketing dollars by proceeding with (or based on) inaccurate data?