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05/24/93

CONTACT: Stanford University News Service (415) 723-2558

Marketers getting 'up close and personal' with consumers

STANFORD -- The days when Campbell Soup and Procter & Gamble could reach 50 percent of American homes simply by sponsoring "Lassie" on Sunday night TV are gone, according to James M. Lattin, associate professor of marketing and management science at the Stanford Graduate School of Business.

Today's mass media markets are fragmented, Lattin said. The term "mass media" barely applies as publications and electronic media seek out smaller and smaller niches of interest and new technologies allowing marketers to customize their products to meet increasingly specialized consumer tastes.

In an article in the March issue of the Stanford Business School Magazine, Lattin outlines changes in the way marketers reach their targets.

Marketers, who issue more than 300 billion coupons a year, are finding new ways to communicate, including utilizing bar codes that "make it possible for marketers to see what goes into the kitchen cabinets of the individual household," Lattin said.

Americans are seeing a major shift, Lattin said, from mass marketing to micromarketing as messages and products are customized to smaller and smaller groups of consumers.

"If I am better able to target my marketing program, I can increase the relevance of my message to the consumer as I decrease the clutter in the environment," he said. "I don't have to drop 300 billion coupons if I have better-targeted delivery vehicles."

The downside, said Lattin, is the potential for invasion of privacy. "Most consumers will tell you: 'I don't want people knowing personal things about me.' Then you come around and say, 'By the way, I've got this frequent buyer program for you. The frequent buyer points might amount to a rebate of a dollar a week.'

"For a dollar a week, some people are apparently willing to sell their souls - not to mention their addresses, phone numbers, and a little demographic information," Lattin said. "We need to educate consumers about how this information is collected, shared and used. It is in our own interest to anticipate the concerns of consumers rather than be forced to react to legislation as consumers become concerned about their privacy."

-jz-

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