Monday, November 16, 2009

Why Aren't You Testing ?

I was having a discussion the other day about the right number of links to include in an email. The email person wanted "x", the product marketer wanted "y" number of links in the email. Of course, this division of thought led to the whole process slowing down. It also sows the seeds for a big, fat, ugly disagreement.

The real answer is simple - "let's test it!"

For anyone who works in a digital marketing space and does not consistently test their own assumptions, you are doing yourselves AND your customers a huge disservice. Digital marketing is an incredible playground. You can construct an almost infinite number of test and - best of all - MEASURE the results.

There are two big issues with testing. The first is "resources" in that you don't have enough people to set up tests. If this is your reason for not testing, then maybe your tests are aimed way too high. Rather than test simple things that can build your track record of testing success, you try to design the "perfect" test that is way too complicated. Or - despite protestations and executive presentations to the contrary - your organization is not really sold out on digital marketing.

Testing subject lines is easy (and valuable). Testing the number of links is a little more - but not much more - complicated. Testing landing page A vs B can be done simply. Testing multiple variables in a high-speed manner can be easily accomplished via software. It's not hard to get started - all it really takes is will.

The second - and much larger - problem is that once you decide to test, you need to leave your ego at the door. The goal of testing is not to prove what a genius you are - it's to prove what works. If you design a test so that the only correct answer is the one you happened to think of, then you're cheating.

I worked at a company where the CEO "designed" the web site on the back of a piece of paper. No testing, no thought. Just instinct and "genius". To this day, you can't sign up to receive email form the company - it just wasn't part of the CEO's genius...When people wanted to test the impact of letting customers sign up for the site (yes, it's THAT bad), the suggestion was rejected because it didn't fit into the "overall design" of the site. A fine example of ego-based test rejection.

Digital marketing offers a wealth of opportunities to learn about what your customers really want, as well as designs and approached that make them want to buy.

The answers are there - all you have to do is test. Check your ego at the door and quit guessing.

Friday, October 30, 2009

Spam is Good

I was recently at the DMA show in San Diego. During the show, I had three different people come up to me had (roughly) the same conversation with each of them -

"Why did you stop publishing your blog?"

"I haven't stopped publishing my blog"

"I didn't get an email to let me know"

"In the last email I sent, I told you I didn't want to spam anyone by sending an email every time"

"Oh. But why didn't you send an email?"

While I would love to think that people are just waiting for my new blog posts, it pointed out a much larger issue - I had made the "spam" decision for them. It turns out that my personal definition of spam was much, much tighter than what these people (which is an admittedly small sample size) were willing to bear. While I was very proud of myself for being so anti-spam, I actually did a disservice to people who would like to see my content.

When I pressed a bit further and let people know they could either bookmark the blog or subscribe to it, the response was "oh...I'm kinda busy - I like to read your stuff but I don't have the time to go searching for it." When I told them I posted on both FB and Twitter, they gave me that "I'm a REALLY busy person who has no time for that nonsense" look.

Here is the value of email in a nutshell - it's a reminder service that prompts people into taking action that they WANT to take. Due to the persistence of the email message, people can look at the reminder when THEY choose to. People need reminders. They WANT reminders. My (artificially) telling them that they were not going to get reminders took away something that they like (although not so much that they subscribed or posted or anything - it's a very slim commitment.)

This frequency argument goes on all the time in the email industry. There is a very vocal sect in the email space that claims if an email is not "pitch perfect," it must be spam. Since spam is inherently evil, then all spam must be stopped - damned what the consumer actually thinks. It's an idea that is not based on the voice of the customer, but instead on the (usually) misguided thoughts of a "marketing genius" who is more focused on their own head rather than that of the consumer.

Now before anyone gets on the "Bob's a spammer so he must be evil soapbox," understand that I'm not talking about email that - at some point - you just didn't ask for. But by artificially limiting what you send to people based upon YOUR beliefs - rather than those of your customers - you end up limiting the incredible value of your email program.

Give your customers some credit - they will tell you when they have had enough.

Wednesday, October 14, 2009

Never Trust Anyone Under 30

As many of you may have read, the Wall Street Journal (via twenty-something author Jessica Vascellaro) recently published an article about how email's reign is over entitled "Why Email No Longer Rules". The article quoted a computer history museum curator, an executive at AOL (who oversees Bebo and AIM), and a guy at SharePoint as proof points. Apparently, journalists at the WSJ are not required to consider balance (not one ISP or ESP is quoted) or research (not one email marketer is quoted.) It's a journalism standard that even we bloggers can understand.

While we can sit here and argue about the merits of the article, it does point out one jarring fact - our culture's fascination with youth (and what the kids are up to) is really beginning to impact the choices we make for our marketing channels. And that's a bad thing.

Here's the solution. Never trust anyone under 30 with your marketing spend. Don't do it. It's bad for you. Like in crossing the streams bad.

The reason is simple - youth goes hand in hand with passion. You're supposed to be passionate about things when you're in your 20's. But while that passion can be used to invent wonderful things by taking highly risky bets, that same "risky bets" persona can kill your marketing effort. Your job as a (direct) marketer is to be dispassionate about media channels. To not get caught up in the hype and instead focus on the results. The problem is, it's hard to be dispassionate, especially when the WSJ is braying like a donkey about the death of one of your beloved channels.

As you get closer to (and past) 30, chances are you've been kicked around a little by life. You have to eat the consequences of your actions. You learn that the risky/passionate play is not always the best move to make. You learn that Newton's Third Law is real. It's at THAT point you're ready to be trusted with making decisions.

Your 20-something staffers all think they can run your team. They just won't say so right to your face. Your job is to give them something they're passionate about and let them run. Hopefully, they'll fail at it. It's good for them.

Monday, October 5, 2009

Google Wave Unleashed!

So Google Wave has been unleashed. Well, sorta. If you can wrangle in invite, that is.

I don't have an invite. But I have sat through the Google Wave full-length introductory video, as well as the truncated 10 minute You Tube version (thank you thank you thank you!) So I know a little bit, but not enough.

Everyone in the email industry is concerned that Google Wave represents the end of email. Given what I've seen so far - as of today - that's just not the case. The products are fundamentally different. From what I've seen, Google Wave is really just a souped up version of AIM (a great product that seems to be a bit of an afterthought for AOL) as opposed to a replacement for email. If social media studies are any indication, it may actually increase email usage.

Google Wave is essentially a real time collaboration tool. Problem is, people don't like to collaborate all that much. I mean, we do when we have to. Otherwise, group-type communications are normally avoided. When's the last time you woke up and went "Oh boy! I have a group meeting today! I'm really excited!" Having a tool that potentially increases the amount of time you can spend in collaboration can be either a good thing or a bad thing - if it helps increase communication by making sure you don't have to be in the same room with those people, it can be good. If it turns into a giant time suck with people dropping in left and right, it would be bad.

I'm also a little concerned about Google's approach to the Wave. The product looks a bit like an answer in search of a question. The fact that they've taken the open source route ("so you can help us finish the product") looks like they're not really sure what to do with it either. While hiding Gmail behind the "invite only" approach built some buzz (or maybe bought time until the product was better) all it really did was to slow down the adaptation of the product (full disclosure - I use Gmail. Eh.)

Gmail, in fact, is an excellent parallel. Everyone was quaking in their boots when Gmail first came out. It did a fantastic job of searching through email - what everyone thought was the Achilles heel of existing tools - but had (and still has) a clunky UI that forces you to learn a new paradigm for email (because everyone knows the brainiacs at Google are way smarter than you). You had to have an invitation. It was exclusive. But last time I checked my email delivery stats (at a company I once knew), gmail represented about 15% of our email names. Not shabby and - to be fair - a GOOD 15%, but not the dominant monster that Google Search represents. (Somewhere Trout and Ries are smiling at the Law of Line Extensions.)

Will Google Wave be the tsunami that wipes out email? Not any time soon. Google does work hard to prove itself correct, so they may have put some code out there that may be a threat at some point in the future. But right now it's the Google Ripple...The Gripple.

Monday, September 28, 2009

Shop.org - One more thing

You know, I've been thinking a lot about a session I attended at shop.org (I'll comment on the actual session later). While all the marketing sessions were full of tingly excitement and buzzwords, I wanted to get down in the weeds a little more. That's right, rather than talk about ideas and theories, I wanted to talk about the issues surrounding execution. I went to a session that was featuring...operations.

A lot of my marketing compatriots passed on this session. That's because a lot of my marketing compatriots are kinda dumb. They're so in love with ideas (especially their own), that they fail to realize (or simply just ignore) the fact that someone needs to implement their visions of glory.

It's a critical mistake that marketers and (especially) senior executives often make - they don't consider the complexities of operations when devising a plan. They figure "we'll think of something." Of course, that lays the foundation of a wonderful relationship between marketing and operations.

There is a clear road between a marketing idea and a successful marketing idea - that road is called operations. Not involving your operations team in planning is a great way to stick a giant pothole in the road.

It's not only important to tell them what your plan is, but to explain why you're approaching it the way your are. By opening yourself up to the people who are responsible for executing your grand vision, you lay the opportunity for everyone to pull in the same direction. Better yet, your operations team can come up with solutions to issues that may otherwise drag down and kill your project. Operations folks (and their IT brethren) love a detailed project plan. By having them involved in the process before finalizing the plan, you'll come up with a plan that not only contains (most of, at least) your vision.

Tuesday, September 22, 2009

Shop.org - Day 2

The show so far has been - to say the least - interesting. It's well attended and has had some great speakers. And yes, everyone is still afraid of Amazon.

Here's my take on what's hot and what's not-

HOT

Twitter/Facebook - This subject is red hot and has generated more buzz than just about anything else. Apparently, a research group (who shall remain nameless because I did not see it first-hand) declared that email was dead as a marketing vehicle and that everything is moving to social. Except for old people, who still read email. This is why research people need to be occasionally muzzled. It's true that tweens have limited acceptance of email, but when were they ever an important email constituent? Email goes to the parents, who fund the follies of the youngsters...

Personalization - It's a clear number two on the list. Personalized this and personalized that leads to ginormous increases in sales. While I like a well thought-out approach to personalized recommendations (I saw a GREAT presentation from Mybuys), personalization is sort of the holy grail of marketing...seems super, but good luck finding it.

Myopia - What's been somewhat surprising is the lack of research on the overall market, as opposed to knowledge gained in the line of business. People seem to really know what they know. If they don't know it, it must not exist.

NOT

Email - After all, it's dead...with the charge towards personalization, email looks like a relic of the batch and blast past. Personalization is great, but people look for the point of maximum efficiency rather than the point of diminishing returns. Focusing on the former makes you super-hip personalization guy/gal. Focusing on the latter doesn't make you cool...it just makes you money.

Optimization - People want to talk about personalization, but very little time is spent talking about optimization. It's great to have all these web tools, but where's the best place to place them on the page? Color/font/button/etc? Small tweaks can do more to raise sales than the hyper-aggressive (and somewhat creepy) use of personalization. It's stunning how business seems to still run on "I think" (the creatives win!) versus "I know" (the quants win .)

Mobile - Still seems like a nail in search of a hammer. Most web sites have awful mobile presentations, but nobody seems to care. One reseacher said that .1% of retail transactions were done via mobile phone. Which seems really low when juxtaposed with Nielsen's data that shows (on average) 14% of your web visitors come from mobile devices. I think that the measurement tools (like Omniture) need to do a much better job of measuring mobile activity. At the company I used to work for, we determined that about 15% of our email traffic was being rendered in a mobile device. But when we looked at Omniture, it told us that there was almost zero web/mobile traffic. Either my previous company set it up badly (possible) or Omniture has trouble reading mobile-generated data.

Saw a very interesting session about multi-channel operational integration. More on that in the next post.

Monday, September 21, 2009

Shop.org - Opening Day (Update)

Here we are at shop.org, looking for the latest and greatest efforts at success. I'll post on topics that are covered in sessions as well as take a spin around the vendor floor to glean the latest and greatest. Of course, I won't be able to resist giving a little opinion now and then.

The buzz so far? Multichannel... I think this represents progress.

There's a lot of people here - both vendors and clients. The view on the trade show floor is one of cautious optimism. People are beginning to see an uptick in business after what has been a pretty brutal year so far. Everyone is looking forward to a stronger 4th quarter. Or - as one person put it - flat is the new up.

The biggest impediment to business is not smaller budgets, but indecision. Clients have been especially risk adverse. They're not saying no, but they're not saying yes. While indecision can lead to budget being taken away, there's still money to be spent. No one is predicting a gangbusters 4th quarter, but people are beginning to see the light at the end of the tunnel. Let's just hope it's not a train...

Thursday, September 17, 2009

DM Central goes to Shop.org

Headed to shop.org next week to look for the latest and greatest techniques for creating value in this crazy economic environment. Will be blogging at least twice, maybe more.

The fact that this conference is in Las Vegas in no way contributes to my desire to go. Really, it's true. Really.

More next week! If you're going to be there, be sure to say hello!

Monday, September 14, 2009

Metrics, Schmetrics

Every once in awhile I find myself embroiled in some sort of vicious discussion about how to effectively measure the impact of email marketing. Rather than comment on the type of people (myself included) who would care enough about the subject to raise discussion to the level of argument, I thought I would throw it open for discussion here and see what people are doing to measure the success of their email efforts.

Here's our problem...people's actions are hard to measure. Yet our business is built on "High ROI."So we have a lot of people (mostly vendors) who tell us that measurement is now scientific as well as a lot of executives who ask for what the vendors have told them is readily available.

There are three distinct audiences that we need to measure. They go from easy to hard in three simple steps.

Group 1 - The Straight Liners - These are the folks that get an email, open it, click on it, then purchase something directly mentioned in the afore-mentioned email. We love these people, because they behave exactly like we want them to. Actually, they behave exactly how our measurement systems want them to behave. More often than not, this is the focus of reports we send to senior management...

Group 2 - The Crooked Liners - These are folks that behave in a non-linear fashion. They might open the email, they might not. They tend to click, but the trip to the shopping basket is either long or non-existent. They might do nasty things like clear their cache on a regular basis. They'll shop, then come back later and buy something that may or may not be what they looked at before. They may look online, then head into the nearest retail shop to actually purchase something. In essence, they're selfish because they do what they want, not what we want them to do.

Group 3 - The Flat Liners - These people rarely, if ever, interact with your email. They don't open, they don't click, they don't buy from the prescribed path we've determined they should walk down. Therefore, they must be dead. Any smart marketer would of course delete these people from their list because hey - if we can't measure them they must not be important. Better to save the $.0007 it costs to send them an email.

Almost ALL of our efforts as an industry are focused on Group #1. Which is all well and good. Problem is that it SIGNIFICANTLY undervalues your email program, especially if you have alternative methods of gathering customers (like your web site...)

When I was at another company who shall remain nameless, the best we could come up with for Group 1 was about $70MM in sales. Which wasn't bad, but really small when compared with overall sales.

What we did was look historically at all of our sales and divided them into "email supported" and "non email supported" (than goodness for non-cooperative marketers.) When looking at the total pool, the amount of sales attributable to email (I'd have to consult with you to tell you how we did it) rose to about $216 MM in sales - over three times the "straight line" method.

But what was really interesting is when we went back and looked at people who were on the database but hadn't ever responded to an email -yet who have never opted out to receiving email. Turns out they purchased over $70MM worth of goods during the measurement period - the same as The Straight Liners. Not bad for a bunch of "dead" people. We couldn't map that all back to email, but we figured why take the risk? So we happily spent the $.0007 to keep sending emails to them. Epsilon published a stat that about 1/3 of your recipients never read your email, but instead head straight for your web site. Looks like that number's about right!

But here's the real insight - each of these groups (at least for the company who shall remain nameless) is roughly the SAME size. That's pretty mind-boggling stuff. It may not be true for your organization, but I'm guessing it's way more true than it is false.

So how have you all handled this issue? Any interesting tales to tell? If so, comment away!

Tuesday, September 8, 2009

What I would like to see from email vendors...

OK folks, it's dream time...time to lay out the wishes and see what happens...

The email industry is at in interesting crossroads. Current tools are - to be kind - rudimentary in their overall marketing utility to an organization. They tend to be built to keep the geeks (rather than the leaders) happy. While this isn't a bad thing, it's a HUGE limiting factor in the acceptance of email as an important channel for many organizations.

Email systems (both internal and external) are all trying to be good at one thing - getting out the mail. With advances in skill and technology, much of the worry about cranking through a list and sending it out is greatly reduced. With dedicated appliances like Netezza, the issue of query time is largely reduced to rubble. It's list processing, people.

So what can the email community do to increase the value of our precious tool? Here's a few ideas...

(1) Component reporting - There are many pieces to an email, including day, date, subject line and time (among others). Each of these "components" should be readily available via the reporting tool, so that more sophisticated analysis can be performed. You ever try and do a time of day analysis? It's really, really hard - especially if you mail across multiple time zones.

(2) "What's happening now" dashboards - How many emails did we send today? How many people clicked on an email today? in the last hour? What's the status on all of your email jobs (publishing, stuck in queue, etc)? Of the campaigns that are out there generating clicks, how many are from campaigns launched this week versus previous weeks? It might seem simple, but these are the sorts of metrics that make it look like you're in control of your program.

(3) Database metrics - How big is my database (yes, it matters)? Do different regions have different growth patters? Is my database growing or shrinking?

(4) Trending - One of the great weaknesses of email systems is that they ignore the impact of time. For example, how big is my database this month versus six months ago? A year ago? What is the decay curve of an email? How long is the message good for?

(5) Integrated MVT (with tracking) - Everyone talks about multi-variate testing, but it's pretty impossible to do with current email systems, generally because true MVT needs the ability to track an email that is uniquely generated at the blaster (after the campaign is launched). Otherwise, I have to cut up my campaign into a bunch of ugly test buckets...which is not pretty.

(6) Segmentation priority - Let's say I have a campaign that pulls 10 behaviors/products into a segmentation array. Of those 10, which has the most impact? What is the marginal impact of each of the additional variables? Most of our segmentation efforts suffer from the fact that we don't know the impact of adding more variables.

(7) Optimization - What's the right size for an email? What's the right number of emails to send to a person before they get exhausted? We all fight the batch and blast mentality, but our current systems do little to help us battle product marketers who are foaming at the mouth for "a bigger list".

(8) Integration with search and the shopping cart - Epsilon published a great statistic that 1/3 of your email recipients will visit your site directly rather than click on your email. That's a huge impact. We also know that when you launch an email campaign, search activity goes up. Some sort of measurement for both of these varaibles needs to be developed to unlock the true potential of email.

Wow...that's a long dream!

I realize that some of these things may be available. I also realize that it's hard to develop this stuff. But I also know that the people who develop these tools into an integrated package will be the ones who win in the end. There's a lot of email companies out there right now. There won't be as many in 5 years. Organizations have woken up to the fact that email works - the companies who deliver on the above expectations (as well as many more that I haven't listed here) will be the ones who win.

Monday, August 31, 2009

A SPECTACULAR email promotion

One of the big challenges in email/digital marketing is the disconnect between brand marketers and direct marketers. Each group is usually separate and often leave lit bags of dog poo on each others' doorsteps.

The sad thing is that this doesn't have to be the case - email and direct can exceptionally reinforce the brand, by delivering knockout content that engages the consumer's sense of connection with the brand.

It's a synergy that does not happen often. So when it does we need to pay attention and give credit.

The other day I received an email from Wynn Hotels. I'm by no means a whale (casino parlance for rich people with a penchant for leaving behind large sums of cash), but I have stayed at the Wynn a couple of times. I think that two of the neon bulbs in the hotel have a plaque with my name on them. I like the Wynn - except when I have a $500 blackjack bet and one of their guests sticks on a 16 with the dealer showing a face card - but am (honestly) not what I would call super-loyal.

One of the great brand promises of the Wynn is that it's special - that Steve Wynn had a vision of gambling perfection, then built it. The question is, how do you fulfill this sort of high-end brand promise in an uncertain economic period ? Many brands resort to sales (long live the direct marketers!), which works in the short term but only cheapens the brand in the long term. On the other hand, not doing something to engage consumers besides fancy words, nice images and promises (hooray, brand marketers!) during a challenging time does not add much value to the brand.

Here's the email. Simple, but a powerful subject line.



It's a very simple email. It doesn't try to sell anything. It doesn't allow you to know the promotion directly from the email itself. Yet it entices you with an exciting and dramatic message - it's actually a great marriage of email and brand. The email doesn't try to do too much but instead completely reinforces the brand's promise of "special."

But the fun part comes next, when you click on the button. You can click HERE to see what's next (and totally screw up the total/unique open rates).

For those of you who didn't click, shame on you. I'm not going to send you to places you don't want to go! You would have seen a fabulous offer of private jet and hotel shuttle service from LA/Burbank to Las Vegas - all at a price that is more expensive than commercial jet service, but far less than private jet service (I know, I've checked). The Wynn took a special/unique service and made it reasonably affordable to "the masses". Rather than resort to straight discounting, they raised the ante for all hotels in Vegas by showing that - despite the economy - they are maintaining their brand identity of special.

This is a fantastic synergy between the power of brand ("special") and the muscle of direct marketing ("special to YOU".) One that we should see much more of, but often don't due to intramural squabbles and fear.

The marketers at the Wynn are to be commended. Even if they can't keep people out who screw up the blackjack tables!

Tuesday, August 25, 2009

I Hate Twitter - Part II (Revenge of the Twitterati)

Wow. Never quite expected the level of discourse that has popped up around Twitter...it's been an interesting search for Twitter-led results. The Twitterati don't take kindly to you telling them that their baby is ugly.

One of the recurring, yet subtle, responses to the initial post is "you're just an old-school marketer who doesn't get it..." - which, as a dyed-in-the-wool direct marketer, seems similar to saying "neener, neener, you're a wiener." It's a strategy that wasn't all that clever in grade school and does nothing to help advance the cause. As a marketer, I "get" what drives cost-effective revenue to my company. If the value of Twitter is undetermined, just say so! It's a lot better to position it as a tool of experimentation rather than an unknown "next wave."

The other strain of response is that Twitter is a listening device. Not to sound totally crass, but so what? Businesses have (at least in their minds) done just fine without leading-edge listening devices. What's the value of listening to your customers? If it's so great, then why are the research people shoved so far in the back of most companies' marketing departments?

The third line of response is that "it's new...", which is kind of funny when you consider that most social media decks talk about the amazing speed with which social media has been adapted. Kind of like having it both ways. You're right - it is new. And the face of these communications will probably change dramatically in the next 12 months.

To sum it all up, the jury is still out on Twitter. Way, way out in terms of effectiveness as a marketing vehicle. There are some successes, but they're small. People point to Dell and Jet Blue, with good reason - they seem to have Twitter programs that generate revenue. What both of those programs have in common is the releasing of cheap inventory...so itseems that Twitter does have a marketing use for unloading distressed inventory at the last minute.

It looks like the problem with Twitter is in positioning. People keep talking about it like it's the be all and end all of marketing. It's not. It's a tool. A small one, as compared to all the other existing marketing channels. One to keep an eye on...but one that - if you're not in the right position to make it work (cheap, last minute inventory and/or interesting news), will end up causing you to waste a tremendous amount of time.

Don't let your senior management bulldoze you into investing more in Twitter than you should...Twitter is like a 5 year old who can hit a golf ball really well. It might turn into the next Tiger Woods...but it's unlikely.

Monday, August 17, 2009

I hate Twitter

I hate Twitter. There, I've said it. I actually feel better. Better yet, I didn't tweet it - you had to come an earn this bit of insight.

There's a million reasons to hate (or maybe even love) Twitter. But I have only one reason - for the most part, Twitter just doesn't work for marketing. In fact, it's an incredible time and resource suck. I'm amazed people dedicate any time and resources to it at all.

I'll give you an example...

Ticketmaster has somewhere north of (conservatively) 20 million email addresses and has (drum roll please)...6,650 people following on Twitter. So for every 1 Twitter follower, there are 3007 emailable addresses out there, just waiting to be marketed to.

Now you could say (a) people HATE Ticketmaster, so why follow them, (b) Ticketmaster doesn't put any effort behind Twitter, so why follow or (c) both. Point taken.

Live Nation - another company in a similar industry - is actively encouraging people to sign up for Twitter. In fact, they have a contest running that is entirely fulfilled via Twitter. They also have more than 10 million email addresses. The number of Twitter followers (once again, drum roll...) 19,986. 1 Twitter follower for every 500 email subscribers. Oh yeah - how are they publicizing Twitter? Via email, of course.

The question is why...why do so many brands fail to deliver on the uber-promise of Twitter? How can Ashton Kutcher have millions of Twitter followers, yet Live Nation (who gives away free concert tickets!) have under 20,000? Here's a few thoughts...

(1) Twitter is not a marketing vehicle, but a news vehicle - Marketing messages (generally) are not news. However, the latest musings from celebrities/athletes/musicians are coveted by the popular press. Twitter allows people an unfiltered method of getting data. The more unique the data, the more appealing the tweet. Most marketing communications are not all that interesting. You may have an intern sitting there banging out "interesting content" for your followers but it's nothing you can't get from other, more ubiquitous sources.

Take a look at Zappos - over 1 million Twitter followers. Yet most of their Tweets have almost nothing to do with Zappos. Because the Twitter page isn't dedicated to Zappos at all, but to the tweets of Tony Hsieh, CEO of Zappos.

(2) Your brand has much less tactical value than you think it does - One of the big issues with brands is that - after a time - the brand itself becomes strategic. In effect, the brand gets separated from the product. Twitter is - at its best- an exceptionally tactical tool that exposes the lack of tactical power of your brand. Companies with "strategic" brands could spend as much time as they want building their Twitter presence. It won't matter. Open the window and throw out your money. Then Tweet about how you're throwing money out your corporate windows...that might work.

(3) Your customers are not as connected as you are - This is where marketers always, always, always get themselves into trouble - they don't market to their customers, but instead market to a small sub-segment of customers who resemble the marketers themselves. Let's face it, from a personal standpoint Twitter is a huge investment/waste of time. If you're in an environment where your customers are (1) addicted to their internet/mobile devices, (2) have serious pockets of time to invest (like people who travel a lot) and (3) are looking to consumer what you have to spit out (news, last minute inventory, etc) you might find some value in Twitter. Just because YOU can't wait to read Shaq's latest Tweet (and he is hilarious), doesn't mean your customers do.

(4) The number of Twitter followers you have means nothing - MC Hammer has over 1.2 million Twitter followers. So why isn't Hammer tour and selling out venues across the country? Because - much like their MySpace predecessors - followers don't mean buyers. Fallout Boy (a fine band) had over 4 million MySpace friends in 2007. The Police had about 20,000. Guess who did better on tour.

(5) Social Networking is Over-rated - The unifying factor in social media is just that - it's a social effort shared among people with at least some passing knowledge of and/or connection to each other. It may just be me, but people don't spend a lot of time in conversation with corporations. If they do, they are usually not the most friendly of chats. The goal is to get people to talk about you - not to talk AT people. Corporations are much better at talking "AT" rather than conversing "WITH" customers.

(6) People can sniff out fakes - Last year there was a campaign by Southern Comfort to build buzz around "So Co" by having a bunch of actors pretending they were being super cool and having a grand old time via drinks made with "So Co." Like "So Co" was their buddy or something. It was (in my opinion) one of the most aggrivating commercials on the radio last year. This year it seems to be gone - people sniffed out the fakes for what they were. Much like "So Co", it's kind of easy to spot when your marketing department is trying to build hype via Twitter. The excessive use of exclamations points are a dead giveaway!!!!!!!

(7) Twitter users suffer from early burnout - There seem to be two types of Twitter users - addicts and the exhausted. Addicts are easy to spot because they're the ones (like a junkie) telling you how great the Twitter high is. Exhausteds are people who have tried Twitter, gotten tired of it, and left (about 60% of new Twitter users become Exhausteds in the first month.) They're more from the "I tried (Twitter) in college...it just wasn't for me." As we all hopefully know, there are a lot more Exhausted than there are Addicts. Thankfully. The question is, do you want to spend that much time marketing to the addicts when they are probably going to find out what you have to say anyway?

I'm not saying that Twitter is completely useless...just mostly. If you have the magical combination of elements, you might make it work. But for most of you, it's time to put down the Twitter and back up slowly from your mobile device.

Tuesday, August 11, 2009

CRM - You call this a relationship?

I recently had a discussion with a marketer. They wanted to change the way they marketed from an "advertising" approach to one that centered on maximizing the relationship they had with their customers. That's right - from direct marketing to CRM marketing.

It got me to thinking...is this the right nomenclature for us as marketers to use? What about our interactions with consumers has led us to believe that we've got a relationship with them? Does the fact that they bought something from us launch them into relationship land? Can we even exert any control over the "relationship" using only communications? Couldn't our "relationship" have been a one time thing where everyone gets what they want then never talk again?

Rather than sit and have a talk about semantics for which I was ill-prepared, I decided to do some research. Not about vendors or what the industry thinks about CRM, but the source of all things true, the Internet. I Googled (side note - when you type "googled" into Blogger, it comes up as spelled incorrectly...that's hilarious) "Keys to A Successful Relationship". I looked through the first 10 or so articles.. here's the collective wisdom. I've narrowed it down to 4 because I'm long-winded enough.

(1) Communication - You have to have a strong, two way flow of communication. The problem is, marketing organizations have a distinctly one-way flow. If your organization does not have an active way to get your customers' preferences into your marketing decision matrix, your relationship is going to have communication issues.

(2) Honesty - You ever buy something, then find out there was something that just wasn't disclosed that made a big difference in your perception? Is your organization prepared to give customers all of the facts, both good and bad?

(3) Trust - Again, this is a door that has to swing both ways? For many organizations, this is just not the case. They spend millions of dollars proving their company is trustworty...but then won't let you return an item without a tremendous hassle - they want you to trust them, but they don't trust their own customers. Nordstrom is a great example of trust that has been built with customers. Walmart has built great trust that they will have the lowest prices. Live Nation's ticket guarantee goes a long way towards building trust into what has sometimes been a shady business. If your customers don't trust you, then they're ripe for the picking.

(4) Forgiveness - This is a hard one for many organizations to follow. Customers screw up - they buy a plane ticket for the wrong day, they're late on a payment, they may write a bad review about your company. You don't have to forgive them. But if you don't, you're essentially telling people that you'll have a relationship with them as long as they're playing by your rules...which is a pretty jacked up relationship.

When you look at these four keys, it's pretty clear that most organizations don't have the infrastructure to support true relationships, let alone relationship marketing. You can sit there and call your customer communications group a CRM practice, but it's a bit like putting lipstick on a pig - the lipstick is wasted and the pig ain't no prettier.

To have a true CRM practice takes an enormous amount of organizational commitment. If your organization is new to the idea, then be prepared to spend some money. Not just for the systems you'll need to put in place to drive honesty and communication, but for the additional costs you'll need to start trusting your customers...and maybe even forgive them.

Wednesday, August 5, 2009

The Mythology of Modeling

Time to take on one of the sacred cows of database marketing...the statistical model. Or - in the words of Mark Twain (or Benjamin Disreali, depending on who you believe), let's talk about "lies, damn lies, and statistics."

I've been involved with marketing models for more years than I care to remember. What I've learned is that modelers - even if they're not very good- seem to go unscathed when looking at the success or failure of a marketing program. Chalk it up to what I call "The Mythology of Modeling," where modelers are the equivalent of modern-day Merlins. Nobody seems to understand their "magic", so it's impossible to criticize them or hold them accountable. OK, maybe that's a bad analogy...here's another one. Modelers are like Rasputin, marketers like the Tsarina. All they have to do is stare at you and talk about KS Stats and you're done.

While I could not develop a model if my life depended on it (aren't you glad those situations never occur), I have come to recognize when you're about to be bamboozled by science. Here's a few things to keep an eye out for in evaluating models.

(1) Ignoring macroeconomic factors - most current day models use the "past predicts the future" logic in determining a modeling strategy. You take a sample from a (recent) period of time, then try and glean knowledge and predict the future. The inherent assumption is that the macroeconomic conditions during your observation period will hold true for the future. Problem is, that's not often true.

A while back I had a modeling company come in an build a model for me, on spec. Their logic was "this model will be so awesome, you will BEG us to sell you more names." I mailed the file (as a test, of course). The model fell on its head. To which the modelers said "you must have a bad sales process and screwed up the implementation." While blaming the client is usually the first choice of modelers everywhere, the fact is that the underlying economy was changing - rapidly. The model was build upon a series of economic assumptions that were simply no longer true. The model was DOA, due to the failure of the modelers to recognize that times they were a-changin'.

(2) Statistical correlation isn't everything - Modelers are in love with correlations. There are a great number of variables that are highly predictive, but so tiny in size as to be almost irrelevant. If you allow these variables into your model, you'll end up with a highly predictive model that maximizes efficiency at the expense of size. While that's nice, size still matters to most marketers. Plus, variables are sometimes too big to have "high" predictive power, so they're eliminated from the model - again at the expense of actual business.

I had a team try to build a statistically predictive music model...when we ran the model, it came up with roughly 75,000 names...problem is, I needed about 200,000 to make the program work. They were quite satisfied with their work and quite surprised when I thought it was sub-standard. Being the client, we know who was to blame...

(3) Interactions are ignored - Data points are great, but the interaction between those data points can contain real value. For example, if you drive an SUV, that's good to know. If you drive an SUV and have 4 kids, that can have a different statistical impact than someone who drive an SUV with only one kid. The 4 kids are about room enough to get everyone everywhere at once. The 1 kid is (more likely) about safety.

The easiest way to figure this out is to run a CHAID (or your favorite interaction detection technique) analysis, then dump those variables into your favorite statistical program. If at least one of the interaction variables does not appear in your final model, your statistician should have some serious explaining to do.

(4) The wrong goals are in mind - More often than not, statisticians will deliver models that deliver the maximum statistical advantage. Problem is, you know -as a marketer - that in the "imperfect" universe there are still a whole bunch of sales. Think of it this way - in most models there is a pretty steep curve. But if you only did, say, the top 20% (because the model told me this was the maximum point of efficiency), chances are you would be cutting out about 50% of sales. That's a bad thing. Your goal as a marketer is not to deliver maximum statistical efficiency, but to deliver maximum business efficiency. So a model should tell you - in business terms - where you really cost yourself in terms of target measurement. Where does your cost per acquired account (or whatever your key variable happens to be) go so far underwater to make the whole effort not worthwhile. THAT's a starting point for where you want to cut off the model...

(5) Using modelers who are inexperienced at business - Statistics are hard. Hard to create, hard to use, hard to understand. As a result, models have fallen into the hands of not the most socially ept people in a company. Not everyone, of course, but in all probability the one who is working on your model. The aggravating thing is that - the less experienced in business a modeler is - the more arrogant they are about clinging to statistical correctness. Sometimes close enough is good enough...but it takes business experience to figure that out. You may get lucky and find a youngster who is good at math, good at business and good at accurately communicating results to management. Then again, you might have a pony in your yard when you get home today.

Which leads to...

(6) Marketing is not deeply involved with the process - As a marketer who is about to use a statistical model, if you're not invested in the development of the model it's your own fault. You're the one responsible for the results - you need to roll up your sleeves and dig in. You don't need to know jack about stats - you need to be able to lend business guidance to the people developing the models. Many of the people I know who develop models do not think like marketers - they're not trained to. That's YOUR job. If you abdicate it and the model fails, bad on you. It's not all that hard to understand the basic concepts. Get in and dig around.

Statistical models are not bad. In fact, they can be quite helpful. But you have to view them with the same vigor you would look at other aspects of your marketing programs. That way you can see your modelers not as someone whose stare can paralyze you, but someone with an interesting way of looking at you...

Friday, July 31, 2009

Testing, testing....

I came across a stat that 54% of email marketers do a/b testing. Which means that roughly half of email marketers don't do testing...the question is - why?

Email is perhaps the single best platform for marketing testing ever invented. You can design a test, then see the results in minutes or days, versus the weeks and months necessary to evaluate a traditional direct mail test. It also costs almost nothing to test, versus the hundreds of thousands of dollars necessary to test using over the air media. If you code the test up right, you can evaluate the results not only in an instant, but over a course of campaigns.

So why is it that so many marketers don't take advantage of such a powerful tool? There's probably as many reasons as there are marketers, but here's a few I've seen.

(1) People running email marketing programs are not direct marketers - Moving from traditional "offline" direct marketing to email marketing was like being a kid in a candy store - the possibility for testing were endless. That's a mentality that many email people don't have, as they tend to be technologists first, marketers second. Luckily, the technologists are easy to spot - they talk way too much about deliverability, honeypots and browser compatibility.

(2) Tests are too far afield from today - Rather than look at incremental changes that can boost the effectiveness of an existing campaign, people will design tests that are completely different from the existing "champion". It's not a bad idea to do this, but if you do you'll run into the brand police - they're even less schooled in direct marketing than the technologists. You can run a boatload of tests on things like subject line (yes, you can see incremental value from testing subject lines), number and position of buttons, background color, image size, and integration with landing page creative. Once you have those buttoned up (and can prove a methodology for testing), you can move onto more far-flung efforts.

(3) Know it all executives - Sometime when you design a test, a person higher up in management will say either (a) "I don't like it" or (b) "I know our customers - they won't like it" (which is the same thing as (a), just couched in a way that doesn't seem quite so egotistical.) This is a tough hurdle, as you're basically telling someone they should come down off their knowledge-filled ego cloud and live in the land of proof. The fact is, it should not matter what you think - it matters what you can prove. The fun part of testing is when you challenge your own assumptions, then let the data tell you what actually worked. For example, I once used a segmentation pattern based upon consumer behavior. Our field group insisted that "we know the consumers in XYZ market better than some smarty-pants jerk in corporate (or words to that effect.) So we said fine, we'll test it. The fact was, our behavior-based segmentation significantly out-performed the "field tested" knowledge. While it didn't close the case (there's always someone who knows better...) it made for a very effective shield.

(4) Tests are designed badly - Complicated tests are complicated to interpret. They're also complicated to execute. Keep your tests understandable and learn to walk before you run. Also, you have to be clear about what you're trying to affect. For example, focusing on sales of creative A versus creative B can be a testing death trap - your job as an email marketer is not to sell, but to bring people to a place where a sale can happen. Back your test up to look at things like click-through and you'll have a much higher degree of significance to your tests. Not that CTs are the bees knees of measurement - the point is that you need to realize what you can and can't effect via email. The sale happens on the web site. The interest happens in the email.

(5) Tests are too big - I recently talked to someone who designed a test, then send 1/3 to the existing piece, then 1/3 to each of the two test cells. So 2/3 of the test was to something other than the champion. This is a recipe for disaster - early stage tests should encompass no more than 10-20% of your email effort, unless the test cells are very small incremental changes from the champion. If you're designing a "big" test cell in order to gain statistical significance, then raise your aim to a measurement that can be significant with a smaller group (like CTs!)

(6) When a test is successful, you push the "GO" button too fast - One of the least appreciated facets of email marketing is the macroeconomic impact of time. That is, while a test is successful, will it be successful next week? Lots of things can happen in a week that push the results in one direction or another. If a test is "successful", the next step should be to continue the test for several more weeks, then look at the tend of behavior over time. I ran a test where - for three weeks - the challenger beat the champion by 11%. By week 6, the results were even - there was no value in implementing the challenger. I don't know why, but the test was good for a little while, then basically fell flat. Time matters.

(7) Email software doesn't make it easy to measure tests - Pretty much every email program I've seen allows for split tests. Some are easier than others to build and execute. The real problem comes with measuring those results, then comparing them to the champion. It can be a colossal pain to pull the analysis together in any sort of meaningful fashion. If the marketer is not full invested in testing, this "lack of feature" will be used as an excuse way more often than it should be...so while it's a reason, it's not a very good one. Unless we're talking about true multi-variate email testing...then it's a good excuse, as most email vendors make it impossible to execute true multivariate testing (but more about that in a future post...)

All in all, if you're an email marketer who isn't actively testing - or recently completed a series of email tests - you're wasting an opportunity to significantly improve your emarketing results.

Wednesday, July 29, 2009

First General Motors, Now The Post Office...

Looks like things are a little more bleak at the Post Office than we imagined...

Did you know that volume is expected to decrease from 208 billion pieces to only 175 billion? Wow!

Click HERE to read all about it.

Monday, July 27, 2009

Email Deliverability

I had a conversation with a friend of mine about the state of email deliverability. It seems that many companies - including well known companies - have deliverability rates under 90%. In fact, many hover somewhere in the mid 80s. As anyone who was awake in the mid 80s knows, this can't be a good thing. Having your deliverability in the mid 80s is a bit like having Mister Mister as your favorite band. You can do it...just don't talk about it in public.

It seems confusing that any respectable email marketer can't regularly achieve email deliverability rates in excess of 95%. With inbox rates of about the same percentage. It's not that hard. People have been doing the deliverability for quite some time...you would think that people get it a little better.

In the interest of the common good, here's a few hints/tips to raise your deliverability. For those of you whose performance is tied to increasing deliverability, this may mean cash. Don't worry, this advice is all commission-free.

There's a ton of stuff we can cover, but I'm going to need some material for future blogs. So we'll stick to a few quickies ...

(1) Regularly mail your file - Constant communication with your file is the key to building your reputation at ISPs. Whether your cadence is daily, weekly or monthly, you should always mail your entire file on a periodic basis. If your file is "dirty" coming in, you may need to slow down your send speed to handle the bumps...but constant mailing will raise the overall deliverability of your file.

(2) Aggressively handle opt-outs & bounces - This is probably the single most important thing you can do to improve deliverability. For those of you who use internal systems, the accurate and timely processing of your bounces and opt-outs is where you are most likely to fail. In the past I've used a very simple formula:

  • Hard Bounce = Immediate removal from file
  • Soft Bounce - try up to 5 times. If unsuccessful, consider it a hard bounce.
  • Unsub - Immediate removal from file (more on that in a bit)
(3) Use an ESP - I've done both internal and external email sends. Deliverability via ESP beat the pants off of internal deliverability. Why? Because you can't fire your internal IT... more often than not, email deliverability is about 27th on IT's "Things to Do". Plus, ESPs tend to have better relationships with ISPs that internal IT groups can. We all have a limit to the number of people we want to talk to...

(4) Clean up your code - It's amazing how many companies still sent crappily-coded HTML to recipients. Stop with the Front Page templates and have a professional review performed (insert blatant plug for Smith-Harmon here...). The purpose of cleaning your code is twofold. The first is to get the email through the ISPs filters. The second is to keep the recipients from clicking on "This Is Spam" because your code renders badly in gmail (yes, I'm talking to you, BSP productions).

(5) Use dedicated IPs. A lot of them - Every time you use a shared IP, you run the risk of jacking up your own deliverability due to some knuckhead also using the same IP. Do yourself a favor and get your own. They're cheap! The key is to have a range of IPs that you use - if one gets "blacklisted", then you swap in new and cleaner IPs to get your mail through. By constantly rotating your IPs (and doing all this other stuff) you'll build the reputation of those IPs, helping to ensure deliverability. If you're bringing back some old data - or sending to people you haven't sent to in awhile - use some of your "spare" IPs.

(6) When in doubt, slow down - Throttling your email sends can help prevent some basic ISP blocks - especially if you're sending to a list that might be a little bumpier than your normal list. While speed can be exciting, it can also cause nasty crashes.

(7) Send a confirmation email - Double-opt in is (usually) overkill, especially for sites where you're not doing much except signing up to get email. That said, it's still a great idea to send a confirmation email to the listed address. Keep those on a real-time stream (so throttling won't be an issue) and don't let the bounces make it into your mail email file. Garbage in = you have more garbage.

OK...anything more than this and we're getting into consulting territory...which of course is always an excellent Plan B...

I was tempted to make a bad Mister Mister reference here...so here goes...Kyrie, take these steps to fix the broken wing of your email program...I told you that being in the mid80s was bad.

Friday, July 24, 2009

Brand, Brand, Brand!

I've had a lot of discussions lately about brand. You know, the five letter word that makes direct marketers stand up and scream "why can't I get a piece of that &*(^ brand budget!"

It seems to have become the modern day version of the Jets and the Sharks - brand versus direct. "Brand Oriented" companies have lots of coolness and sizzle, while "Direct Oriented" companies have short ties and toilet paper on their shoes.

Frankly, I've had a whole pantload of the panting, sycophantic admiration of "brand". Because brand is an after-affect. You can't create great brands and be successful. "Brands" only come around after the hard work has been done. Problem is, once things get into the hands of "brand marketers" - who think that their brand doesn't stink - the fun really begins. That's when we find out that - more often than not - brands that lose their focus can quickly become irrelevant. Fun like in "We're the Titanic - we ain't afraid of no stinkin' ice bergs!"

Think of it this way...great products are like parents who worked hard and built something for themselves. Maybe something really great and successful. Brands are sometimes like their spoiled children who don't know anything but success, then think the world owes them a living. The kind of kids who want to be lord and master of ALL the toys. The efforts of these children (often known as "line extensions") usually end up where they belong - on the scrap heap of effort along with their teenage guitar lessons.

If brands were as powerful as brand evangelists make them out to be, then the world would know the wonders of Nike Kitty Litter and BMW Toothpaste. But brands are just not that powerful. Just ask Lehman Brothers. Or General Motors.

I love the Japanese auto makers - they're not as wowed by the Brand dictum. When Toyota (a great and reliable "brand") wanted to go upscale, they developed a new brand. But Lexus wasn't successful because of the power of the then-unknown brand. It was successful because of the product that embodied "The Relentless Pursuit of Perfection". The brand was a guide, not a rule.

At the end of the day, the brand playbook looks pretty damn simple -

  1. Be first in the market and/or first in the mind.
  2. Narrow the focus of your effort - don't go too wide.
  3. Find a word or phrase you can dominate in the consumer's mind. Then dominate it.
(Many thanks to Al Ries and Jack Trout for their book - the 22 Immutable Laws of Marketing. If you haven't' read it, you should. It's short - your attention span can handle it.)

The job of branding is really #3 - find the word/phrase and dominate it. Like Lexus did. Which is - essentially - the essence of any good direct marketing copy.

Direct Marketers have enormous benefit from having a focused brand strategy. If your brand marketers adhere to rule #3 (which is essentially a direct marketing mantra), you'll both be way ahead in the game. It will allow you to craft messages that expand on simple and powerful themes. You can even play in the same sandbox. Even if you do have toilet paper on your shoe...

ADDENDUM (7/24 - 4:51 PM Pacific)

OK, I wrote this blog post without seeing this article...

http://www.dailyfinance.com/2009/07/24/cadillac-cologne-for-the-scent-of-bankruptcy/

Looks like the brand geniuses are at it again. Hey Cadillac - why not just make a better product?

Wednesday, July 22, 2009

Visit to the Post Office

Last week I took a visit to our local SCF. It wasn't like I had a particularly large package to deliver...they were offering a tour (and offering BBQ). While the prospect of spending a couple of hours watching mail being sorted would run many people screaming towards the hills, it actually warmed the cockles of my DM-loving heart.

While we've all heard about the post office running big deficits - and the email marketers among us snarking about how "snail mail" is really just a Dead Man Walking - the visit was jarring on a couple of levels.

First off...there are no young people working at the Post Office (at least at this SCF.) To call the staff here "veteran" would be an understatement. It looks as if the Post Office' seniority-based employment model has resulted in lots of older folks behind the machines. Not that this is a bad thing but hey, these people are going to retire soon. Who's going to come in and lead the next generation of workers?

Second...there's way too many Post Offices. Maybe an obvious statement, I know...but this SCF is HUGE and not humming at full capacity. I would think that it's better to run one plant on two shifts rather than two plants on one...The Post Office has to do some serious roll-backs of physical plants in order to ever hope of making a profit.

Third...nothing but bills and commercial mail. We can blame email for this one (and maybe text messaging.) So if that's the case, why deliver mail every day? Who cares if your bill/magazine delivery date is off by a day or two? I live approximately 20 steps from my mailbox, but there's nothing that comes to make me run out every day and check the mail. I could certainly live with every other day...so why not have one ZIP Code on MWF and the other on TThS?

Fourth...on the good news side, they're working hard to make use of technology. Handling mail - especially hand addressed mail (have you looked at your handwriting lately?) - is laborious. The Post Office has developed some pretty cool technology to cut down as much as possible on the hand work. Maybe they can use technology to handle to coming employment gap.

Lastly...I love direct mail. As a marketing tool, it's not as encompassing as it used to be, but it still can have a solid role in your marketing plan (just don't ask the emarketers for advice...) It's trackable and can reach people who don't like or respond to email (yep, they exist!). It is a lot "stickier" than online. It allows you to present your brand in a way that emarketing simply cannot approach. It would be great if one of our direct mail vendors could come up with some data on how direct mail drives online search activity...that way, the eventual blending of the worlds can finally start to happen.