Tuesday, April 29, 2008

Another Edition of Follow the Money

April 28 (Bloomberg) -- Barack Obama's supporters are giving him more than just record amounts of cash. They also are providing personal information that may make his donor list the most powerful tool in U.S. politics.

Even if the Democratic presidential candidate doesn't succeed in his White House bid, this data will make Obama a power broker in the party for years to come. For the interest groups or Democratic candidates he chooses to sell it to, it would provide a gold mine of information and access to potential donors.

Almost 2 million people have entered personal information on Obama pages on social-networking Web sites such as Facebook, MySpace and his campaign's mybarackobama.com, offering home addresses, phone numbers, their views on specific issues and the names of friends. The data have allowed Obama, 46, to raise more than $200 million, fill sports arenas with supporters across the nation and motivate millions more with custom-tailored messages.

``It's gigantic,'' said Laura Quinn, chief executive officer of Catalist, a company that maintains a database of 280 million Americans. The list is as ``transformational'' as the advent of political advertising, she said.

Volunteering Information

The Illinois senator's biggest innovation is in persuading people to enter personal information directly on his campaign's Web site, according to Bill McIntyre, executive vice president of Grassroots Enterprise Inc., a Washington-based Internet marketing firm that advises campaigns.

McIntyre, a Republican and former chief national spokesman for the National Rifle Association, said the data entered by 800,000 names on mybarakobama.com may be worth as much as $200 million.

While in the past, campaigns have cross-referenced lists of registered voters against other records such as credit-card purchases or magazine subscriptions to find potential supporters, Obama's information is more accurate and precise because it relies on data that donors provide themselves.

``When people give information online, they are going to be more truthful and more credible because they are in the privacy of their own environment,'' said McIntyre.

Republican Effort

It's the kind of detailed information that Republican operatives such as Karl Rove, who directed President George W. Bush's campaigns, excelled at gathering through expensive microtargeting techniques that combine data from several sources. The Democrats responded with Catalist, a similar list- building effort organized by top Clinton campaign adviser Harold Ickes that sells its data to ``progressive'' causes and candidates, according to its Web site.

Obama's success stems from a decision early in his campaign to embrace the concept of social networking, allowing him to leap ahead of his Democratic rival, Senator Hillary Clinton of New York, or the presumptive Republican nominee, Senator John McCain of Arizona. For example, Obama now has 790,000 Facebook ``friends,'' compared with 150,000 for Clinton, 60, and 117,000 for McCain, 71.

Mybarackobama.com, the first social network specifically devoted to a political campaign, is modeled on Facebook. Chris Hughes, a 24-year-old Facebook co-founder, has been a fulltime Obama campaign worker for more than a year and helped develop the candidate's site.

Part of Campaign

When supporters join mybarackobama.com, they become part of the campaign, gaining access to phone bank lists, local events and the ability to contact like-minded people or recruit new ones.

Mybarackobama.com is also a sophisticated data network that allows the campaign to home in on detailed information such as whether a supporter is more concerned about civil liberties, foreign policy, education or energy policy.

People who provide their information on line may not realize that the data they are posting at mybarackobama.com may have a long afterlife and find its way to other campaigns in future election cycles.

According to the Obama campaign's online privacy statement, it reserves the right to ``make personal information available to organizations with similar political viewpoints and objectives, in furtherance of our own political objectives.''

Fair-Market Value

Federal election laws require campaigns to charge for the use of their data. The campaign must either sell the information or record the transaction as an in-kind contribution at fair- market value.

Obama campaign spokesman Tommy Vietor declined to comment on the value or possible future uses of the data.

Even as Obama's interactive databases prove to be efficient ways to energize volunteers, their ability to raise large amounts of money may outlast the current campaign, said Tad Devine, an independent media consultant.

``That's really what we are talking about here,'' said Devine, a former strategist for Democrat John Kerry's 2004 presidential bid. ``We are talking about a fundraising network that will far surpass the dominance that the Republicans held in the '80s and even in to the '90s.''

Obama's list of 1.4 million donors may be an especially strong fundraising tool in the future, Devine said.

``This is something where if this guy sends out a letter saying send some money to someone, suddenly a House candidate can have a half million dollars in a day,'' said Devine. ``That may be what the House candidate was hoping to raise in a quarter.''

This ability to produce results ensures Obama will play a prominent role in the future.

``Win or lose, it's his list,'' McIntyre sai

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