How Database Marketing Can Turn Companies Around

"Moneyball," the current hit movie based on Michael Lewis' 2003 book by the same name, is a story that has two important lessons for direct and database marketers:

FIRST, there is big money to be made by those whose decision making is informed by the best data and most sophisticated analysis of that data.

SECOND, in order to stay ahead of the competition, you need to keep improving the quality of the data that you are analyzing, and the sophistication of the analysis itself.

For our industry, let's tweak the name and call this process "MoneyMarketing." The following summary of the movie will provide a general framework for what I am talking about:


"Moneyball" is the true story of the Oakland Athletics baseball team during the 2002 season. The Athletics, despite being a small-market team with limited financial resources, find a way to compete against large-market, mega-budget teams such as the New York Yankees and Boston Red Sox.

The secret, as put into practice by General Manager Billy Beane, is to hire a data miner and put him to work crunching the numbers. Billy collaborates closely with the data miner and, in fact, confers with his quantitative expert every time a decision has to be made. Specifically, formal statistical analysis is employed to chew through large amounts of data, and the findings are used to guide the scouting and signing of players. In short, Billy puts robust data and sophisticated analytics front-and-center in the running of the organization.

The problem is that Billy Beane runs into major resistance within the Athletics organization. The team's old-school, tobacco-chewing scouts feel threatened by the new, data-driven approach. However, in the end, Billy Beane prevails. The 2002 Athletics are able to stand toe-to-toe with teams that enjoy vastly greater financial resources, but whose decision making is driven by the non-quantitative thinking of their old-school scouts. In fact, the Athletics win 20 consecutive games, which breaks the all-time American League record going back to 1901.

Moneyball "Postscript

So, that's the story as neatly packaged by the movie. But, what happened after the end of the 2003 baseball season? Unfortunately for Billy Beane and the Oakland Athletics, the subsequent real-life events are unlikely to inspire a "Moneyball 2" sequel:

Several of the mega-budget teams soon caught on to what Billy Beane was up to, and the Athletics no longer had a competitive advantage. Two years later, the Boston Red Sox - one of the mega-budget teams that implemented Billy Beane's approach - won its first World Series since 1918. Fast-forwarding to the present, the Athletics have not made the post-season playoffs for five straight years.


Billy Beane became data-driven, which is exactly what database marketers have been preaching for years! So, what would Billy think if he were named General Manager of your organization? Would he decide that it is run by our industry's version of the old-school, tobacco-chewing scouts? Or, would he conclude that you are winning by using MoneyMarketing? Specifically:

Billy Beane would want to know if robust data and sophisticated analytics are front-and-center in the way that you run your business. He would not be happy if he found that you are keeping them in the background - in the minor leagues, so to speak - of your organization.

How would Billy Beane know for sure if you are a true data-driven organization? Based on his experience with the Oakland Athletics, he might ask the following four questions:

FIRST, do you have a best-practices Marketing Database? Without the highest quality data, even the best analytical minds in the business are limited in the value that they can provide.

SECOND, do you have top-notch analytical professionals on staff or on retainer, with years of industry experience in uncovering the "nuggets," and then working closely with the marketing and creative teams to turn these nuggets into major-league profits? These are more than just statisticians! They are seasoned quantitative consultants with a deep understanding of the BUSINESS of direct and database marketing.

THIRD, if you have top-notch analytical professionals on staff or on retainer, are they "invited to the table" when management discusses important strategic and tactical issues? Or, are they considered back-room specialists who are heard from only when spoken to, but seldom seen by management?

FOURTH, are you always looking for new ways to improve your data - that is, your Marketing Database? Likewise, are you always searching for innovative ways to analyze and take advantage of your data? Remember that your competitors are probably not standing still. If you do not keep advancing, they might just blow by you, and maybe even "steal home."

There is much more to say about the specifics of MoneyMarketing. But for now, if you cannot answer "yes" to all four questions, then you are not winning by using MoneyMarketing - and, you should ask yourself if you are like the old-school, tobacco-chewing scouts in the Moneyball movie. They resisted the sophisticated, data-driven way of making decisions. Eventually, they were exposed as relics of a bygone era. As Billy Beane might warn:

Old-school direct and database marketers often end up unemployed. Old-school companies often end up in bankruptcy.