The new marketing concept is aiming at both fulfilling the Office's legal obligation to publish statistical data and meeting the data requirements exceeding the "basic supply". The basis for this work is a marketing model (chart 1) which encompasses the following three levels: Basic information provision, Standard provision geared to demand and target group, and Customer-specific data preparation and consultation. Basic information is offered free of charge. It is aiming at fulfilling the needs of the general public. Products and services which are specially requested by special target groups in the form of standard products that are prepared in advance are sold at market prices. To fulfil user-specific information needs, special and detailed information has to be compiled. In this respect, the statistical offices function as service enterprises who charge their customers for their services.
The marketing model shows the
chance of marketing of statistical information representing public property
and also the extent to which it could and should be marketed. The transparent
and well-structured model approach helps to answer the frequent question
of the legitimacy of marketing that information. In addition to ensuring
the democratic right of all citizens to be provided with basic information,
marketing of additional services fits in the legal framework. This sort
of marketing excludes the reproach to subsidise individual
user groups at the expense of the general public, improves resource control
and eases the budget burdens.
The Federal Statistical Office of Germany looks back on a long history of user oriented dissemination of its statistics. It includes a grown tradition of rules and habits how the different divisions treated their customers. This situation brought up a variety of cost regulations. All in all we were faced with more than 40 different pricing systems which were difficult to handle. The end of the story was that most of our colleagues were avoiding these rules at all, made their own rules giving the data away free of charge. Another reason was that the subject matter divisions (as direct producers of the information) did not benefit from the possible takings. Therefore they preferred not to think about costs and income but to concentrate on their essential work. You may understand, trying to implement a new marketing model, meant to create nothing but trouble.
The marketing model was well accepted in theory, but we had to find out whether it will work in practice. In the Federal Statistical Office we discussed it on three levels
First level: Bottom up
A so called marketing clearing team was installed, consisting of three heads of divisions. This team held meetings where different target groups were invited. Topics and questions varied from meeting to meeting. As main topics pricing, how to create products, new services, allocation of budgets, chargeable services etc were included. Understandably, the team had a large list of questions and problems to solve and to integrate in the marketing concept.
Second level: Top
Without agreement from the top level, as to say the director general and the board of directors, it is not possible to carry through a change in marketing policy. And one step further, the support must accompany the whole process. It amounts to this: the top level of the organization must recognize the new regulations. It must be understood that changing the marketing policy affects the whole organization. The new regulations apply to all customer relations and create lasting changes of working processes. In the Federal Statistical Office it was not always easy to be in line with the concepts of the directors.
Third level: Top down
Once the marketing concept has passed the board of directors, the organization as a whole need to be persuaded. Each member of the staff should be informed about the changes. We decided to put the marketing document in the intranet and inform everybody by a memo. Furthermore we called meetings systematically for all interested colleagues division by division. It is a time consuming procedure but we are quite convinced that it is necessary for good results. In addition the Marketing Clearing Team is holding a consultation hour twice a month, were anybody can find solutions for special questions concerning the marketing. Either way the "FAQ" list will become longer and longer and the marketing concept will become a living document.
Some fundamental questions and
answers
The most important and frequently
asked questions are listed below.
In accordance with the marketing
model all products and services within the middle circle should be offered
on the market. These products are standardized. They are ready made or
can be reproduced easily, e.g. products on CD or extracts of a database.
They are documented in a publication list.
As the market price we should
identify and define a price which the users are ready to pay for a product.
As a rule, the market price of a product does not correspond to the manufacturing
cost of a product, but it may be higher or lower. In general, there is
some correlation between the quantity of data and the price of a product.
That is why most countries use the number of pages as a reference to fix
the price for printed publications. In view of the fact that identical
sets of data are increasingly distributed on different data carriers (paper
and electronic media), this approach to cost estimation becomes questionable.
This is the reason why the Federal Statistical Office uses data-related
prices as a basis for cost estimation as well as the expenditure added.
However, such cost estimation should be used for internal purposes only,
while users would be informed about prices. These market prices should
be published in a price list.
In most countries, this question
has been answered positively during the last few years. According to a
new EU directive, not only statistical publications as works, but also
various kinds of information from statistical data banks, which were built
up by statistical institutes, may be subject to copyright. That is why
it is recommended that all statistical publications should be copyrighted
in order to be protected. On this basis license agreements may be concluded
with suppliers of information so that financial means are secured in case
of further distribution.
As prices are fixed within the middle segment only, differentiation of prices is possible only there. In the Federal Statistical Office price reductions are introduced for some groups of users for instance the educational sector or for public libraries. In addition, there are subscribers receiving products free of charge or in terms of mutual exchange. Examples of those receiving them free of charge are parliaments, government bodies, press media, international organizations. The basis for price reductions is the list of 26 user groups.
According to the marketing model, inquiries should be free of charge only if they relate to the segment within the outer circle, i.e. basic supply of information. It is not expensive to reply to inquiries that relate to the outer circle. In most cases these are inquiries on the telephone or requests for sending a folder or a list of publications. The limits of a free inquiry service in the Federal Statistical Office are fixed (an hour of working time and/or 15 copies for the first service). Inquiries which are more voluminous or which are on a regular basis are always subject to charges (e.g. 40$ per hour of an employee). However, we are obliged to inform our users in advance of these calculations.
First of all we estimate the costs actually caused by all of the tailor-made products and services, including costs of employment and materials. In case of a special and voluminous evaluation involving the transfer of data we additionally charge data-related prices. For reasons of reputation (to furnish proof of one's own expertise) it may sometimes be advisable to charge prices below the cost incurred. Prices for tailor-made services are negotiable.
In order to establish stable relations with customers, the accounting and registration should be done by the unit selling the products. This makes it possible to reply to complaints flexibly and take into account the needs of users. In some statistical institutes receipts do not flow into the budgets of these units, but are booked on a central account. It should be stressed that if receipts were booked directly the divisions concerned would be encouraged in their motivation to sell good products and services on the market. In the Federal Statistical Office we agreed on a budget share of 70 per cent for the unit which provided the information service (and 30 per cent overheads).
Source: U.S. Census Bureau, Marketing Services Office,
Research, Planning and Evaluation Staff
Created: May 26, 2000
Last revised: June 08 2000
