Archive for November, 2007

November 26th, 2007

Is losing customer data the only way to raise its profile?


So, a copy of the entire UK Child Benefit recipient database has gone missing. If you haven’t heard the story, a junior government employee is alleged to have put the entire database of 7 million families receiving the government’s Child Benefit - along with their bank account details - onto two CDs and somehow they’ve got lost in the post. They don’t appear to be at the location they were sent from, nor at the location they were sent to and not in the hands of the courier company who is supposed to have carried them.

It doesn’t surprise me that this has happened. Some might say it was bound to happen sooner or later. But this wasn’t the first time a database has gone missing and it certainly won’t be the last. Moreover, it’s certainly not the first time an organisation has unwittingly compromised the security of individuals on whom it holds sensitive personal data. In February of this year the Nationwide Building Society was fined £980,000 after a laptop containing 11m customer names was stolen from an employees home.

In my view, data is still a word that has lowly status in many organisations. It’s a technical word and everything associated with it tends to sit somewhere between the IT department and the Post Room - you know, that messy corner of the company where people get in at 7.30am and go home at 4.00pm. As a result, data is not a big topic of discussion in board rooms, unless of course, it gets lost. And that’s because someone does some digging and finds out that companies have a legal duty under the Data protection Act 1988 to look after it very carefully.

The Seventh principle of the Data Protection Act is the area that all companies and organisations should be highly familiar with. It states that “Appropriate technical and organisational measures shall be taken against unauthorised or unlawful processing of personal data and against accidental loss or destruction of, or damage to, personal data.” I wonder just how many MD’s, Marketing Directors or government ministers would be tongue-tied if you asked them to quote the Seventh Principle of the Data Protection Act?

Now we are in the Information Age, managers of all organisations should be fully aware of two things; First, they have specific responsibilities for customer data under the 1988 Act and second, that ignorance of the law is no defence. Data is serious stuff; it should be a board room topic not least because that’s where the buck has to stop when it gets lost.

November 15th, 2007

Colossus Restart


Today one of the world’s first digital computers, Colossus has been restarted at Bletchley Park after 14 years of reconstruction.

Colossus was designed and built in the 1940’s to crack German wartime codes. The restart is being given added atmosphere by German radio amateurs who will transmit authentic messages from Germany using an original German Lorenz SZ42 machine. Colossus will try to crack the code.

Apparently, anyone with their own computer who can receive the signal can join in the code-breaking fest. There are three levels of challenge based on the wheel settings of the Lorenz machine in Germany. First up is what could be considered the easier option (which I’d call extremely difficult if not impossible), then medium (which I’d call impossible) and finally “the Killer” (a challenge that could be compared to racing a wheelbarrow against a highly tuned Ferrari). Anyone who fancies having a go can find the transmission details here.

According to Tony Sale the leader of the rebuild project, “a virtual Colossus written to run on a Pentium 2 laptop takes about the same time to break a cipher as Colossus”. The Colossus team are expecting a result sometime tomorrow.

November 12th, 2007

The new white goods


Many marketers use the terms brown and white goods to describe electrical products. Historically white goods were fridges, freezers, washing machines and dishwashers. Brown good were things that I suppose where originally produced in bakerlite - radios, TVs and radiograms (remember, your granny may have had one like this).

But of course now Apple has redefined ownership of white. What were brown goods items have become white goods. I wonder if white goods will go brown?

November 8th, 2007

Radiohead new album sales

All sorts of conflicting stories about online sales of Radiohead’s new album In Rainbows. Consensus seems to be around 1m downloads with revenue per download at between $5 (£2.50) and $10 (£5)per sale. Apparently, Thom Yorke is keeping quiet. All I can say is a) I did register, but have forgotten to buy it and b) that’s what we used to pay for albums in the late 70’s.

November 7th, 2007

Can Facebook take adrevenue from Google?

So Facebook’s founder Mark Zuckerberg has declared that “The next 100 years start today, and it’s going to be different.” Well both points are certainly true when isolated from the immediate context of his comments. But are they true for the audiences he is specifically addressing?

By saying that the next 100 years start today, young Mr Z. must surely be waving a derogatory digit at Google. From Google’s perspective, the next 100 years began in autumn 1997 when Backrub was renamed and made available to Stanford students. Mr. Z. thinks he’s onto something bigger and better than Google. And maybe he is. But the reality is that nobody can say for sure. Why? Well that’s because Google’s adrevenue model is proven and Facebook’s is not.

To date, Google’s adrevenue has been generated from a direct response model; PPC effectively took us back to the old results-based payment per inquiry (PI) deals. Direct response advertisers like paying for sales results and not for simply being seen. These direct response advertisers like the way Google’s performance based model works for them so the money flows straight in. For Facebook to take a share of this direct response revenue, it must deliver results that are at least as good as those generated by Google.

But Facebook has an ace and this could be where the $15bn comes in. Because of the way it is used, and because of the type of people who use it, advertisers may see it as more than a purveyor of direct response sales performance. They may come to view it as a place to talk about brands in targeted ways to highly targeted groups of consumers. This means that it could be liberated from the rigid ROI metrics that rule direct response. And that in turn means that advertisers may be prepared to pay more per person reached on Facebook and and be more relaxed about how it delivers ROI. From a media owner perspective, that’s a good place to be when it comes to counting the ad revenue dollars. In other words, the next 100 years did begin in 1997 for direct response advertisers, but they may just be about to begin again for brand advertisers.