Marketing sharpens its aim with new weapons

THE 1980s, it is generally accepted, saw marketing come of age. Shotgun-style sales drives were replaced by more sophisticated methods that enabled companies to aim the message at particular audiences rather than throw it into the wind and hope for a return.

Some in the business suspect direct marketing has become too sophisticated and personalised, and have reverted to more traditional approaches. But Sue Squires, product development and marketing director of Capscan, said that overall, the decade was 'the time of profiles'.

By this she means the demographic classification systems, such as Acorn, Mosaic and Define, developed by her company and others, which are licensed to tap into Census data and sell it to interested organisations.

The main basis for these categories has been geographic location - from which the type of person and his or her buying habits are implied. But recent years have seen a challenge from the lifestyle approach. Ms Squires said that lifestyle - what people do in their spare time - versus census became the 'big battle' of the 1980s, and the debate was still going on.

It is difficult for an outsider to tell where one ends and the other begins. For example, CCN, a competitor of Capscan, which operates the postcode- based Mosaic, claims that Financial Mosaic - launched last week - offers a substantial improvement on Census-based operations.

The product is designed to achieve 'the highest possible discrimination' in the personal financial services market. Explaining that other classifications use the financial questions in market research surveys to qualify the Census information they use, Richard Webber, managing director of CCN Marketing, said his product represented an important breakthrough in targeting methodology - by using direct measures of financial activity, such as credit applications, purchase of privatisation shares and defaults on loans.

Employing the most detailed financial statistics, the company has identified 36 distinct types of financial consumer, falling into 10 groups. Among the better categories for financial organisations are 'student innocence', made up of people who are just entering long-term relationships with suppliers, and 'blue-chip portfolios', those who invest heavily in stocks and shares. At the opposite end are 'victims of recession' and people with 'repayment difficulty'.

The system, which classifies each of the UK's 1.5 million postcodes using statistical information about their residents, also shows that nearly 20 per cent of UK postcodes are not good prospects for financial services companies.

However, the system is like its predecessors in requiring a company such as CCN to interpret the data. Ms Squires believes the increasing sophistication of in-house marketing departments and the falling price of computers will make the middleman less necessary. But as cheaper equipment will put a premium on the value of software, she sees a new market opening up.

'It's a pretty hefty investment to get good-quality data,' she said, pointing out that hardware used to account for 80 per cent of the cost and software 20 per cent. 'Now, it's the other way around.' But it was 'much cheaper than making a mistake in siting a store'.

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