Continuing Power of Mass Advertising

This is an MIT Sloan Management Review article. For several years now, marketers have been urged to embrace one-to-one marketing and to offer micro-segmented consumers customized products and services through targeted outreach. While the "market of one" approach can pay off, say the authors, it requires a significant upfront investment, including: implementing customer relationship management software applications; filtering, enhancing, and cleaning customer data; and personalizing interactions (e-mail, billing, offers, and so on). These activities take time and the coordination of multiple parts of the organization (marketing, customer service, sales, information technology), which can be daunting for companies trying to react quickly to a changing environment. In addition, those systems have often produced disappointing results because their use was not well integrated with corporate strategy. Also, micro-marketing strategy, on its own, is too narrow. Companies still need to reach broad groups of people with messages that are not dependent on an individual's decision to open an envelope (whether virtual or physical), pick up the phone, or click on a box. But broad-based, broadcast media is ineffective and expensive. Fortunately, there are alternative solutions, such as one-to-one targeting and the broadcasting of 30-second television spots. The author's research on trends in marketing spending and consumer attitudes about advertising reveals four strategies available to companies that want to reach broad groups of people without breaking their marketing budget. The strategies are liberally illustrated with examples from Nike, Microsoft, UBS, Delta, Sony, Procter & Gamble, Citibank, Nextel, Honda, Nokia, and McDonald's, among others.

• Marketing
• IT management
• Advertising