Databases as a key marketing tool are starting to mature. The average database has been in place for six years with £424,000 being spent to run it annually. In nearly six out of ten companies, the marketing department took the original decision to create a database. Marketing remains the key user, having access in 91 per cent of companies, followed by sales (62 per cent).
Research carried out by DMIS has revealed the scale, scope and strengths of marketing databases in UK companies. Based on telephone interviews with 100 organisations across a range of industry sectors, it discovered that the mean size of databases is now 2.1 million records. There is significant polarisation, however, with 35 per cent of companies holding more than 400,000 records while 36 per cent hold fewer than 50,000.
An important issue to emerge from the research was the low level of database distribution across business functions. Only 34 per cent of respondents had a company-wide database - more than half (51 per cent) held the database at departmental level. Even more significantly, only 4 per cent of databases were found to be fully-integrated across the business, with 43 per cent partially-integrated.
Jo Howard-Brown, managing director of DMIS, said: "Data is the lifeblood of modern business. Our research shows that most organisations have recognised the importance of having access to customer information for marketing purposes. Yet they still lag behind in putting the same information to use when it comes to defining business strategy."
Respondents were asked what level of importance the database played in defining and supporting their company's business strategy. The mean score they gave was only 6.23 out of ten. This limited role runs counter to current best practice in business which places a strong emphasis on being customer-oriented and data-driven.
Failure to use the marketing database to support business strategy could also lead to a budget squeeze. Although the marketing department funds the database in 49 per cent of companies, at 41 per cent it is carried as a corporate overhead.
Jo Howard-Brown said: "If the company is not seeing any broader benefits, it might look to scale back this financial support. At a time when customer information may be your only true competitive advantage, this presents a real threat."
For further information contact:
Jo Howard-Brown,
Managing Director,
DMIS
Tel: 020 7494 0483,
Fax: 020 7494 0455,
E-mail: jo@dmis.co.uk.
Web site: www.dmis.co.uk
Note to Editors
The Direct Mail Information Service commissioned research to identify the existence and nature of data strategies, the role and management of databases, responsibilities and budgets deployed, as well as the purposes for which data is used and whether external lists are rented.
This involved 100 quantitative telephone interviews carried out between October and November 2001. A sample of companies was chosen to represent a broad spread of industry sectors. Companies surveyed had an average turnover of £360 million with 82 per cent employing more than 500 staff.
All the companies had advertising budgets of over £500,000 with the average spend being £11 million. Interviews were conducted with personnel directly responsible for the database and data strategy.
