Here comes the perfect mailing list

American Demographics, August, 1991 by Mark D. Uehling

IN HEAVEN, THERE IS NO "JUNK" mail. Every letter matches the habits of its addressee. Someone who wants to know more about vitamins and lingerie will receive precisely these types of third-class mail, and nothing else. In heaven, no one will ever discard an unwanted catalog.

This perfect world has not arrived, but it is on the way. Equifax, one of the nation's largest credit bureaus, has asked roughly a quarter of the 80 million people in its files to join a program called Buyer's Market.

"Basically, it's a qualified lead rather than a mailing list," says Keith Wardell, a senior vice president at Equifax. "We're offering marketers a chance to get discounts to people who say they want them."

In technical terms, Equifax will spend $10 million to create a consensual database. This is a list of people who have expressed consent to be listed and who also offer information that will be used to target them for different categories of mail. In return for their cooperation (and a $15 fee), participants in Buyer's Market get up to $250 a year in discounts on products they want.

Buyer's Market participants also tell Equifax what products they prefer not to see in their mail. As marketers purge unfriendly names from their computers, they will save tens of thousands of dollars. Eventually, the deluge sent to those in the Equifax database may subside.

Equifax is motivated by more than concern for consumers and marketers. The company expects to enlist a million house, holds by the end of 1991, and it will profit handsomely if it can charge a premium for its mailing lists.

The company could also benefit in tactical terms. Privacy advocates worldwide are trying to restrict the rental and sale of mailing lists and other information. But Buyer's Market complies with pro-privacy legislation now under consideration in several states, the U.S. Congress, and the European parliament. "The most stringent legislation now proposed on Capitol Hill would not allow the use of information for any purpose other than the purpose for which it was provided," says Wardell. "The law would put every mailing list in the country out of business--except ours."

If the Equifax database is successful, it will attract imitators. A few have already begun to emerge. Trinet America is a New Jersey-based company that uses thousands of telephone directories from around the country to create and update a comprehensive database of 9.1 million American businesses. Trinet researchers conduct 700,000 interviews monthly, asking for the name, address, senior manager, and principal activity at each business location.

Alan F. Westin, a professor of public law at Columbia University, predicts that all databases will be consensual ten years from now. He points to an Equifax-sponsored survey that shows 76 percent of the public saying that the sale of information about income, homeownership, and credit history to direct-mail companies is "unacceptable." Westin, who has studied privacy for 30 years, believes that the climate of hostility is intensifying. "People are approaching the feeling of being violated," he says.

Equifax is aware of that mood. Last year, its files were at the heart of a Lotus database withdrawn from the market after strident consumer protests. Small wonder that the Atlanta-based company has gone to unusual lengths to be forthright about its own plans for the information it collects.

Unlike traditional list vendors, who seem to sell names, addresses, and buying habits in perpetuity, Equifax polls its listees annually. Buyer's Market members can withdraw from the program or simply select new types of mail as their lives change.

"Everybody's concerned about the privacy of their data, and rightfully so," says Wardell. "But at the same time, 70 percent of people, when given value in return for providing information, will provide that individual information."

Databases Demystified

A good free introduction to database marketing is available from PrimeNet DataSystems of Bloomington, Minnesota. Its 36-page "Database Marketing Guidebook" describes database information sources, system development, implementation, evaluation, and maintenance. For a free copy, call (800) 247-5086.

--Mark D. Uehling