When we think of the “tragedy of the commons,” we typically turn to Garrett Hardin’s classic essay by that name. The argument is that people acting out of self-interest can and will exhaust a commonly-held resource as they have no incentive to moderate their usage. Thus the owner of sheep will permit the animals to graze on land open to one and all, as will the shepherd next door, and the owner of sheep in the next dwelling. The common grazing area, valuable to all, will eventually become worthless. To correct this situation requires moral insight and a willingness to adopt policies concerning the use of a resource. We think about this when we opt to buy a car that emits a smaller quantity of greenhouse gases into the atmosphere.

grazing sheep

I often invoke the tragedy of the commons in a commercial context (where some people stare at me, apparently wondering where the hell is this guy coming from?). Corporations have a “commons,” too, though it is not the commons of sheep farmers or the air we all breathe. In any organization there are resources that are shared internally, and often the many subdivisions of the organization fight to get primary access to those resources. Most often there is a complaint about the development queue in the information technology department (“I need to get this platform built now, but the IT guys can’t get to it for a year”), but the IT department is not at risk of withering away (though it could — and probably should — be outsourced); more likely it will simply survive as a corporate bottleneck, allowing opportunity to pass the company by. Other resources, however, can and do decline from overuse. At the top of this list is the customer database, the green pasture of business opportunity.

At the lowest level the customer database is simply a list of people who have bought things from you. A company then logically says that if I sold something to Henry before, I may be able to sell him something again. Thus, if Henry purchases a router at Best Buy, he may find emails every single day in his inbox, urging him to buy something else. I use Best Buy as an example advisedly, as my purchase of a Sonos audio system unleashed a torrent of emails. Best Buy is in the company of other organizations that “mine” their customer lists with annoying frequency. Some of my personal antagonists include Orvis, L. L. Bean, Rochester clothing, Brooks Brothers (why oh why did I buy those socks?), United Airlines (grrr), and, of course, Verizon and Verizon Wireless, the twin demons of the abuse of the captured customer. In the world of the Kitchen reader we could nominate a few entities, but I will forebear. I will be interested in seeing readers’ lists of nasty direct marketers in the comments section of this blog post. Watch your language, please! There are children listening.

More can be made of these databases, however, than simple direct-to-consumer (D2C) marketing; indeed the D2C opportunity is the least of it. Increasingly companies working in scholarly publishing are building detailed profiles of their users, occasionally purchasing fields of data from third parties to augment the files already in hand. As these databases grow in size and sophistication, the business opportunities become clearer and more hands dip into the database in pursuit of profit. Beginning with D2C marketing, sophisticated companies learn to use the database to inform all levels of business thinking, from sales to product development. It’s fair to say that a scholarly publisher that does not have a database marketing strategy in place is likely to lose ground to its rivals. So let me ask this rhetorical question: How many readers of this blog are ahead of the curve? Behind it?

Meanwhile, the biggest opportunity has been sacrificed, that of having the feedback from the users flow through the organization, informing every decision in each department.

But all those hands in the database! This is where the tragedy of the commons comes in. The shared resource of the marketing database becomes used and then overused. While the database may have had its origins in the marketing department, or perhaps a subset of that department (perhaps the unit responsible for the organization’s Web site), other departments soon get into the act. Editors may want to use the database to mail out surveys, senior administrators may wish to contact a selection of users about long-term strategy. Over time the people in the database stop responding or respond with anger, making the database of no value or even of negative value if the user responses become skewed through lack of broad participation. Meanwhile, the biggest opportunity has been sacrificed, that of having the feedback from the users flow through the organization, informing every decision in each department.

Perhaps it would all be simpler if all we are doing is grazing sheep! But what we need to do is to allow the sheep to graze in a sustainable way. To do so a database marketing operation requires, at a minimum, the following:

  • Clearly articulated, uniform privacy policies. One department may wish to use information that was generated by another department with different privacy expectations, which not only may annoy users but is also a significant breach of faith.
  • Appropriate software to manage the database. The word “database” among publishers is often thought of as an aggregation of content, but more fundamental is the underlying software in which the content resides. Sophisticated database software enables nuanced uses of the data.
  • Plans to augment the database. This can take multiple forms. At the very least every department that uses the database should come up with a strategy to enlarge and enrich the content.
  • Carefully drawn policies on use. Different organizations will answer this question in different ways. One organization may determine that everyone in the company has read-only rights (for analysis); another may put an absolute ceiling on the number of times a user can be contacted. Whatever the policy is, it must be unambiguous.

When we contemplate some of the bigger deals in scholarly communications over the past few years, it becomes apparent that some of them — Elsevier’s acquisitions of Mendeley and SSRN, for example — were motivated by a desire to gather more data on end-users (and we have no reason to believe that Elsevier has no other acquisition targets in mind). The key thing about building end-user databases is that even as their economic implications grow and become more apparent, the need to act with restraint becomes paramount. Graze within limits.

Joseph Esposito

Joseph Esposito

Joe Esposito is a management consultant for the publishing and digital services industries. Joe focuses on organizational strategy and new business development. He is active in both the for-profit and not-for-profit areas.

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Discussion

6 Thoughts on "Database Marketing and the Tragedy of the Commons"

Great analysis, but I’d add one more bullet to your database marketing must-haves: Robust analytics practice to interpret and communicate results.

People often ask what the ideal frequency for an email is, and the answer is not a clear-cut one — it depends on the results. Reasonable people can disagree on how many marketing touchpoints are too many, but the data do not lie. Are opens, click, and most importantly conversions on the rise? How’s that visible opt-out performing? Are tactics like retargeting (which people claim to hate but often yield big, quantifiable returns) effective? Having people who can turn your marketing data into insights and communicate them up and across the organization are critical for optimizing outreach and results. Nobody wants to see the pasture go barren, especially not the marketers.

I’m a big fan of Elinor Nostrom’s Nobel prize-winning work on commons, since making a commons sustainable, as espoused in this post, is a far better solution than doing away with the commons altogether. Along those lines, I’d like to turn Joe’s rhetorical question into a practical one – are there databases that exist that are already shared in a healthy manner? Perhaps we can learn from them. After all, one of Nostrom’s laws states: A resource arrangement that works in practice can work in theory.

A couple of comments:
– As a database marketing I do not want everyone using the database to be tasked with bringing new people into it. Presumably the database is a combination of prospects and customers. I don’t want the editors sending out promotions to turn prospects to customers and I don’t want to folks in Research dept. (or the C-suite) getting prospects. There is a reason that there are people who are tasked with this within an organization … let’s not have a free-for-all.
– If one doesn’t want to receive daily emails from a vendor there is a very simple solution — UNSUBSCRIBE. Every commercial email has an unsubscribe link, Joe; if you are unhappy, please use it. I’m happy when people opt out of my lists. I don’t want to be bothering them and clearly they are not a good prospect.

The basic point of this piece that a corporate database is an asset that needs to be used carefully is very important. But keeping the database healthy isn’t rocket science, it just requires some common sense.

As libraries begin to explore customer relationship management software, it would be great for us to learn from the lessons of commercial entities. Though liaison relationships are very important in academic libraries, as library service portfolios expand, there are increasing reasons for service managers to contact users directly and not rely on mediation by subject liaisons – yet best practices have yet to be developed.

Databases have long been created and exploited to further marketing and sales objectives. The AAUP has long rented lists for member presses to use in their direct marketing to potential customers, and so have scholarly associations, which usually have the capability of breaking down these databases into very niche-oriented lists that correspond to subsectors of the discipline. Such use of databases does not, i think, raise any “tragedy of the commons” issues, but should be noted here as a longstanding and accepted practice in scholarly publishing of the sharing of personal data.

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