CIO — WHEN MY WIFE SAW AN AD for a new, less intrusive blood-sugar tester to help manage her diabetes (available free via a coupon at our local pharmacy), she snapped it up. She’ll do anything to make a distasteful part of her life easier. What she also received in the bargain was an onslaught of very targeted direct mail and Internet solicitations from the manufacturer of the test as well as from several pharmaceutical companies.
As a marketer, I like the fact that I can get closer to my customers through CRM. And I’m well aware that people are willing to share even the most intimate details about themselves if they think they’re getting something of value. CRM allows a business to have a dialogue with its customers, thus creating an opportunity to solve problems expediently, identify needs, and increase customer satisfaction and revenue. It’s the company’s eyes and ears to the marketplace.
Yet as a consumer, I’m wary that every nuance in my family’s private life is simply more marketing information in search of a perfect pitch. Old-fashioned notions of privacy, of course, have already gone out the window. The availability of information now in the public domain is staggering: From toll-free numbers to warranty registration cards to department of motor vehicles records to catalogs and club memberships, information about most everyone is on a database in some form or another. The vast majority of solicitations from these sources are merely intrusive and not unethical.
Gray Ethics
CRM raises some disturbing ethical issues that fit into a grayer, more unregulated arena. These are issues that we as a society must grapple with, more so in some industries than others.
For instance, the pharmaceutical companies have done a stellar job of exploiting CRM. Before 1994, they spent less than $50 million a year in direct-to-consumer marketing, but in 2000 they spent nearly $2.5 billion. Above and beyond blanketing the broadcast and print media with advertising, pharmaceutical companies are using CRM to hone their marketing messages to specific doctors and patients. Studies have shown that when patients go to a doctor and request a drug seen in an ad or a direct mail solicitation, almost half the time they will walk out with a prescription for that drug. A November 2001 study by The Henry J. Kaiser Family Foundation, a health-care research organization based in Menlo Park, Calif., found that of those people who talked to their doctor about a medicine they saw advertised, 44 percent said that the doctor gave them the prescription medicine they had asked about. Some observers say such direct marketing to consumers is unethical because it usurps the prescription drug system and physician-patient relationship by directly targeting people when they are at their most vulnerable. It also puts tremendous pressure on physicians to prescribe drugs that are usually more expensive and not much better than older, generic medications.
