Data Driven Marketing Economy

Recently I read an article about how technology advances help new entrances and smaller players in their digital marketing efforts(https://www.acxiom.com/blog/value-v-rsvp/). Technological advance has bolstered the Data-Driven Marketing Economy (DDME), and development of Individual-Level Customer Data (ILCD) has benefited both large-scale and small businesses. These great advancements in the data world has indeed eased the harsh business environment that small business and start-up companies are facing. However, in my perspective, the competitive landscape in the market is not in the favor of small-sized firms, or new entrants of the market.

Larger firms have larger consumer base and more resources than small firms. Just as the report mentioned: Some firms “used the ILCD of their own customers and did not rent, buy, sell, or exchange data with third parties; they tended to be large and self-sufficient”. They do not need to reach out and acquire third-party data because they already have an abundant amount of first-party data. On contrary, small firms rely more on third-party data than large firms. They utilize data in customer acquisition, which “matters more to them than to large firms with large installed bases of customers and products.” In this way, large firms are already one-step ahead in the game and at the same time have free large data base for further analysis, while small firms pay for data to acquire more customers. Large firms who already have a large consumer base will no longer focus on new customer acquisition, but utilize ILCD to retain existing customers and provide better service to increase customer satisfaction.