The Data Experience: Part 1 – List Companies Defined
What’s interesting is that although there are thousands of List Providers or List Companies operating today, only a handful of them actually compile and offer unique data sets. In fact, the marketplace is flooded with resellers many of which are very reputable and trusted channels to work with, however some may not be.
Part 1 in a series written exclusively for “MP News” readers, Modern Postcard’s List Sales & Data Solutions Manager Dan Anglin will take you through the nuances and dynamics of the Mailing List Industry so that you can find the right list, reach the right prospects and get the results you deserve.
LIST COMPANIES DEFINED
Although there are exceptions, List Companies can be categorized into the following five segments.
This is the direct source, the point where data is collected and offered to third parties and beyond. Relatively speaking, this makes up the smallest segment of the overall “List Company Universe” that’s in business today. Unless you’re pulling a significant amount of data on an annual basis from a particular data provider, contacting one of these companies on your own (especially with a mailing of less than 5,000 pieces) may not be your best bet. Examples of Data Compilers include:
- Dun & Bradstreet – B2B Data Compiler
- InfoUSA – B2B and B2C
- Acxiom – B2B and B2C
- Experian – B2C
- Equifax – B2C
Generally speaking, all of the above-mentioned compilers offer “unique” data sets that are similar in nature. Although these compilers compete against one another in the list marketplace on a daily basis, it’s actually very common to learn about certain situations where they share data between each other, which creates for lack of a better saying, an incestuous atmosphere from a data perspective. Despite these similarities, each compiler will have a core competency that makes them a better choice over the competition in certain situations or selections. We’ll get into that later.
List Management Companies
List Managers handle the day-to-day operations of “Managed Properties”, exclusive data products that originate from a single source. A few common examples include Magazine Subscriber Files, Controlled Circulation (newspapers, newsletters), Trade Association Membership Rosters and Catalog Buyer Files. List Owners of these files will often appoint a List Management Company to handle all promotions, list counts and order requests. Basically, if you want the mailing list for subscribers of Golf Digest Magazine, it’s only available in one place, through the respective List Management Company.
Now, if you are yet to work with a List Manager on a Managed Property, consider yourself lucky. It can be a frustrating experience, especially if you don’t know the lingo and don’t know the right questions to ask and don’t know what to specify on your requests. While they are a vital resource, List Management Companies are usually not positioned as “full service data providers.” If you go to them with a particular request, they may not have the exact solution you’re seeking. At the end of the day, the sole job of a List Management Company is to rent the inventory they maintain in-house and may not be able to resell or broker a file outside of their inventory – where your ideal list might reside.
If that’s the case, your efforts may be better served by working with a different segment of the List Company universe, a list Broker (see below). It will cost you the same and a Broker has your back.
Providing you access to a multitude of different files and sources are the List Providers, or List Resellers. While this segment makes up the majority of the List Company Universe, some partner exclusively with just a handful of sources. Whether their scope is limited to sources they deem “best of breed” or sources that offer them better contract pricing, your list options may be limited.
It’s also very common for providers within this segment to do a fair amount of repackaging or private labeling of data products. This is where they pull a particular selection of data out of a compiled file, rename it and market it as an exclusive or managed property. Here’s where you need to be careful.
A List Provider offers a file they call, “Affluent Database.” The consumers have a high household income, live in high market value homes and are of the average age of 55. Nine times out of ten, under the hood are very simple demographic selections from a basic compiled consumer file: $150K+ household income, $1,000,000+ home value and an age select of 35-75. Meanwhile, the List Provider is charging a premium for a list that is only unique on the surface level.
Basically, it’s the difference between dining at a fancy restaurant and paying premium prices or going to the grocery store, buying the ingredients and making the same dinner yourself.
Individuals or companies that give you access to virtually any commercially available list on the planet are the List Brokers. What’s great about a Broker is their ability to work with any source, making their recommendations on what files to test or rent unbiased. Their goal is to find the best possible list for your specific business, product or service, without being influenced by existing relationships they have with X, Y or Z data sources.
What’s also great about the brokers is that if you wanted access to a Managed Property, the broker should be quoting the RETAIL rate that you would receive if you were dealing with the List Manager directly. The broker makes their money through a small commission, 10-20% on the base rate, paid by the List Manager. That said, this channel SHOULD provide a price neutral environment, which is ideal.
Brokers also deal with these List Managers daily and know their processes in and out, which means your orders should fly through their systems very quickly. They handle all the paperwork and interaction with the List Manager so you can spend your valuable time on other aspects of the campaign or your business in general. When working with a List Broker, it’s suggested that you make sure that they are members of the DMA (Direct Marketing Association), which confirms you’re working with a professional who adheres to industry best practices. This quick check is really suggested for ANY List Provider or Data Compiler you’re looking at working with.
This is a hybrid between the aforementioned segments and typically represents your best case scenario. This unique group has the ability to offer specific “best of breed” data products at very reasonable prices per the volume they do with the respective sources on an annual basis. Through this group, they possess the ability to take your target demo and geographic area, run the request through multiple providers and report the totals back to you along with pricing. This way, you’ll see which providers possess the best coverage for your target audience in one swoop.
As mentioned previously, each provider has their strengths over the competition in certain areas. The process of running the same criteria through multiple sources will bring out these strengths, relative to your target objectives. At the same time, they can also put their Broker cap on if your program requires a specific data set outside of their core product offering, such as a Managed Property that we talked about previously. They often represent the best of all worlds.
That being said, the old adage of going direct and cutting out the middle man to save you money on costs is not usually the best scenario for you when it comes renting a mailing list for your direct mail campaign. The major reason is that just like most industries, the data business is a very volume driven animal. The more you buy, the better price per unit you’ll get. So, whether you have a small to large scale direct mail program, going through a List Broker/Provider that rents millions, even billions of names a year from various data sources may represent a better rate for you.
Read Other Installments of the Article Series:
The Data Experience, Part 2: List Types Defined
The Data Experience: Part 3 – Automated List Selection
*As a blatant plug, Modern Postcard’s List Services would be categorized as a List Broker/Provider Hybrid. We offer you access to any commercially available mailing list on the market. We also have relationships with every major data provider, giving you a consolidated resource for your direct mail initiatives. If you are looking to grow your business with direct mail, our team of dedicated Direct Mail Specialists has over 80 YEARS of combined experience with direct mail advertising. Modern Postcard also offers list rental on a stand-alone basis, so if you just need data and nothing else, we have products and solutions available to support your requests.
Give us the opportunity to leverage our experience on behalf of your next acquisition campaign, and I assure you that you won’t be disappointed!