Wow, here's an issue none of us care about!
We've had this debate a few times before (Hilton Conquest and Amex come to mind). Ken's point about results is really the bottom line - the only way companies will stop doing this is if it stops working per their model. The issues for the future (as I see them) are honesty and backlash.
Matt already shows the results of the lack of honesty in his post, describing the offers that are not clear cut as coming from "cocaroaches". If company X mails an offer that states:
10,000 bonus miles for customers who fly NY-LA 3 times in the next 60 days (offer available only to customers that have not flown NY-LA on company X in the last 12 months)
anyone who sees it understands the "target". They can complain about the strategy but not about the elegibility. I believe this creates much less resentment than finding out about a bonus offered by seemingly random mail that may be based on individual patterns, gender, or any other criterion that the :
sophisticated software that allows them to segment their members by travel preferences, number of flights flown, destinations, partner purchases, just about anything
Pam describes. The more individualized, and thus biased the offers, the greater the resentment as the information is posted, e-mailed and otherwise desiminated in our "new internet world"
This will create a growing backlash. Elite's may not react immediately, but react we will. I know that targeted offers at others that I did not receive have already lowered my opinion of certian companies. Consciously and subconsciously I (and I'm sure others) are already "looking" for ways to "get even" for being overlooked. (For example, I already regret not taking advantage of two offers from airlines that would have given me elite status after a small number of flights - because a particular practice of my preferred carrier has me questioning the value of my loyalty to them.) The "backlash" will grow to a point where it
will become a factor in the marketing models. That, IMHO, will be the result of the popularity of the internet and places like FT - targeted marketing will reduce brand loyalty, and will do so more rapidly if the targeting is too individualized and not clearly defined.