Quantipulation In Action: Inbound Vs. Outbound Marketing

Mashable (that highly reputable source of marketing theory and research) recently published an article called Inbound Marketing Vs. Outbound Marketing, which claimed:

“Thanks to the Internet, marketing has evolved over the years. Consumers no longer rely on billboards and TV spots — a.k.a. outbound marketing — to learn about new products, because the web has empowered them. It’s given them alternative methods for finding, buying and researching brands and products. The new marketing communication — inbound marketing — has become a two-way dialogue, much of which is facilitated by social media.

Another reason why inbound marketing is winning is because it costs less than traditional marketing. Why try to buy your way in when consumers aren’t even paying attention? Here are some stats from the infographic below.

–44% of direct mail is never opened. 
–84% of 25 to 34 year olds have clicked out of a website because of an “irrelevant or intrusive ad.”
–The cost per lead in outbound marketing is more than for inbound marketing.”

My take: Total garbage. This attempt on the part of people looking to differentiate the “new” marketing from “old” marketing completely misses the boat. 

Let’s look at this point by point:

“Consumers no longer rely on billboards and TV spots — a.k.a. outbound marketing — to learn about new products.” Who said that consumers relied on billboards and TV spots to learn about new products? Marketers relied on billboards and TV spots to make consumers aware of their products, to increase recall of their products, and create positive affinity. As long as people continue to drive along the highway (how’s the commute in your city? Yeah, sucks in mine, too) and watch TV, marketers will find that billboards and TV spots to be at least somewhat effective at those objectives. 

The new marketing communication — inbound marketing — has become a two-way dialogue, much of which is facilitated by social media. Got news for all the inbound marketing alarmists out there: Marketing has always been a two-way dialogue. It just wasn’t as easy to execute as it is today. Marketers have relied on various mechanisms — postcards, focus groups, toll-free phone numbers — to encourage feedback from consumers. Claiming that the “old” marketing was “one-way” is false.

44% of direct mail is never opened. First off, how do they know that? Think about how much direct mail you get. I challenge you to come up with even a reasonably accurate estimate of how much of it you open and how much you throw away before opening. Second, even if this were true, then I’d say: WOW! More than half of direct mail is opened. That’s pretty damn good in this marketing environment!

84% of 25 to 34 year olds have clicked out of a website because of an “irrelevant or intrusive ad.” What the hell is wrong with the other 16%?

The cost per lead in outbound is more than for inbound marketing. Stupidest claim I’ve heard all month. Just because there is no measurable media cost associated with this thing you call “inbound” marketing doesn’t mean there aren’t costs associated with the efforts. Somebody has to create and manage the social media site, right? Or, if the inbound marketing channel is the phone, do the costs of staffing the call center not count as part of inbound marketing efforts? And given the incredibly inexact science of attribution in the marketing world, how does anyone really determine that a generated “inbound’ lead wasn’t influenced by outbound marketing efforts?

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The infographic included in the Mashable goes on to claim that in the “old” way of marketing, marketers rarely sought to “entertain or educate.” Seriously? The ad industry has a RICH history of attempts at being funny and entertaining. Print ads have LONG been focused on education. 

The article also tries to differentiate “new” marketing from “old” marketing by claiming that in the new marketing, “customers come to you”, while in the old marketing, marketers sought out customers. 

Customers come to you? Really? And how do they find out about you? Simply by word-of-mouth? Good luck with that. Listen to what Groupon had t say:

“After a two-year holdout, we finally decided to run real television ads. In the past, we’ve depended mostly on word-of-mouth and limited our advertising to online search. This year, we realized that in spite of how much we’d grown, a ton of people still hadn’t heard of Groupon, so we decided to give in to our Napoleon complex and invade the rest of the world with a proper Super Bowl commercial.”

Bottom line: Trying to make inbound marketing sound like something superior and new is total BS. Marketing is a complex process. There are parts of the process that are inherently outbound and parts that are inherently inbound. There are new channels of communication that create new opportunities for both outbound and inbound communication.  Oh, and real marketers don’t take marketing advice from Mashable. 

Why TV Ads Don't Go Viral

Adweek recently ran an article titled Why So Few TV Ads Are Viral Hits. According to the article:

The Holy Grail for many marketers is having their big-budget TV spot become a viral hit online, providing millions of dollars worth of free exposure from consumer pass-along.”

Market research firm Millward Brown (MB) found, however, that just 15% of the 102 TV ads they studied became viral hits, and concluded that:

Even those spots that do achieve viral success don’t necessarily mean consumers get the intended commercial message.”

I can’t imagine that you’ll be surprised to learn that MB is now offering a “creative viral potential measurement” service as part of the copy-testing process. The firm has “crafted 10 tips for making a TV spot viral,  including great creativity, wide dissemination, good search optimization and, perhaps most important, the need to ‘cross your fingers’.”

To summarize: 1) Few spots go viral; 2) Going viral is no guarantee of success; but 3) MB will still charge you money to help you determine if your spot has (oh let’s just call it) viralocity.

Adweek misnamed the article — it never says why so few TV ads go viral. I’ve got a few theories, though. Few TV ads go viral because so many of them:

1. Suck. On second thought, while it might be true that many ads suck, it’s actually not the reason they don’t go viral. After all, that “Charlie Bit My Finger” video went viral, and it sucked.

2. Don’t connect emotionally and authentically. There are two common threads to ads and videos that go viral: First of all, they connect with people on an emotional level. That emotion could be humor, sympathy, nostalgia, whatever, I don’t know.  But while many TV ads try to evoke emotion, emotion isn’t enough. The second common element is authenticity. Viral ads and videos don’t try to go viral. The ones that do tend to have a quirky appeal to them. Agency-done ads don’t have that quality.

3. Aren’t supposed to go viral. This might be hard logic for advertisers to follow, but readers of this blog will have no trouble getting it: Many ads are designed to accomplish specific business objectives, which results in them being written in a way that doesn’t lend itself to becoming a viral ad. In other words, by not going viral they actually have a better chance of accomplishing their business goals.

This whole topic of viral TV ads is ridiculous. The “millions of dollars of free exposure” you’d get is only helpful if you reduced your ad budget by millions of dollars. But that’s not going to happen, is it?

And how fleeting are these viral videos, anyway? Can you remember the hot video from three months ago? (OK, granted, I remembered Charlie Bit My Finger, but mostly because I thought it was so stupid).

And is this so-called extra exposure really that valuable? While direct marketers measure their effectiveness by calculating incremental sales, advertisers count exposure, even if the same 10 million people see their ads over and over again.

And what’s with this “cross your fingers” business? The fact that MB is going to “evaluate” ads’ viralocity pretty much guarantees that ads won’t become viral, since that will pretty much kill any hope of authenticity.

So why all the interest and focus on viralocity among the advertising community? The answer can be summed up in one word: Ego. It isn’t about driving business results, it’s about creating bragging rights.

Is it any wonder I harbor a disrespect for the advertising industry?

Technorati Tags: Advertising

Twitter's Ad Platform Is Doomed To Fail

Apparently, Twitter disappointed the SXSW crowd by not unveiling Twitter’s new ad platform. It’s just as well: An ad platform from Twitter is doomed to fail.

Here’s why:

Back in the day, TV advertising was pretty effective. You know why? Combination of captive audience and the right delivery mechanism.

Back before Tivo and the remote control, lazy ass Americans (like me) stayed on the couch when commercials came on. I wasn’t getting up to change the channel, that’s for sure. Advertisers knew we weren’t going anywhere.

But in order to make sure their messages got through to us, they did something else, that in hindsight, was brilliant: They read (or performed, or even sang) their messages to us.

It’s not inconceivable to think that advertisers could have chosen to display the text of ads on the screen for us to read. After all, in the previous medium, radio, messages had to be read to the audience. Seems plausible to me that someone could have said “Phew! We don’t have to read ads to people anymore! They can read it for themselves.”

That didn’t happen, of course. If it had happened, TV advertising — and TV as an advertising-supported medium — would not have succeeded.

Roll the clock forward to 2010, and TV advertisers don’t have it so good. There’s no captive audience. Technology advancement and channel proliferation have freed us from advertising captivity. [We’re still lazy and don’t get up from the couch, though. OK, well I don’t].

And so marketers have turned their attention to alternative channels, and most recently, to Twitter.

But Twitter can’t — and won’t — ever succeed as an advertising channel.

First of all, we don’t want to read. It’s too much effort. TV and radio ads — and increasingly online ads — are verbal. Print ads are predominantly visual. Sure, there are many good text-intensive print ads, but those are typically for certain types of products.

There is another reason, perhaps not as important as the previous one, that helps to convince me that an ad platform from Twitter won’t succeed: People on Twitter aren’t there to listen to what anybody else has to say.

I’ve concluded that most — OK, maybe not most, but a lot of — people on Twitter are just bored, attention-starved egotists with nothing better to do than broadcast every thought that passes through their heads. That wouldn’t be so bad if they took the time to listen to what other people were saying. But they don’t.

You might think that I’m offending some people by characterizing them as attention-starved egotists. Doesn’t matter. I’m not offending any of you. By definition. The fact that you’re reading this separates you from them.

What convinces me that so many Twits aren’t listening is this: I have 976 Twitter followers, and (on a good day) 77 subscribers to this blog.

Assuming all the blog subscribers are Twitter followers, why are there 900 people so keen to follow me on Twitter — where I say absolutely nothing of redeeming value — but unwilling to read what I write on this blog?

The answer is that they could care less what I have to say. They follow me strictly in the hope that I will reciprocate and follow back. They follow me in the hope that I will listen to them, even though they have no intention on listening to me.

And if they won’t read what I write here, or on Twitter for that matter, why do you, dear marketers and advertisers, think they’re going to read what you tweet?

No willingness to read + no willingness to listen = No advertising platform success for Twitter.

Technorati Tags: Twitter, Advertising

Delusions Of Brandeur

Bank branding efforts are in full force these days. Frost Bank of Texas launched a brand building campaign in April designed at improving awareness of its full range of services, including banking, investments, and insurance (wow, isn’t that a surprise!). Flagstar claims to be the “new wave in banking” (interesting choice of terms when you consider that “new wave” music went out of style more than 20 years ago). And WaMu launched its effort to be an iconic brand, by eliciting a whoo-hoo from its customers.

My take: First off, these banks are failing to support these branding efforts with their Web sites. And second, that might not matter, anyway.

For all the efforts that banks make to tell their customers and prospects that the bank is different (or better), their Web sites just scream “we’re really the same.”

Sorry, Flagstar, but your site — with its top nav-bar menu tabs, large banner ad mid-center page, and product links below the banner ad — is not the “new wave in banking.” Sorry, WaMu, but a link on your home page that promises help with mortgage payments, but only goes to a page that provides your phone number does not elicit a “whoo hoo” from this bank customer. Sorry, Frost, but while I like the notion of asking your site visitors “how can we help you today?”, simply providing a list of products is often not what a customer needs help with.

Close your eyes for a moment and picture your bank’s Web site. See the login boxes on the left? The product-focused banner ads in the middle? The links to every product the bank offers below that? And the major line of business links along the top-nav bar? Of course you do.

The dilemma that bank site designers face is deciding between familiarity and uniqueness.

On one hand, when a bank Web site follows certain conventions about navigation and design, it make it easier for a site visitor to know what to do and where to go.

On the other hand, though, when you spend millions of dollars in advertising telling the public that you’re “different,” a site that conveys “sameness” creates brand discord.

Should banks overhaul their site design conventions to support their branding efforts? If they do, they should look at the site for Marriott‘s St. Kitts property as an example of how to be different. Granted, the loading time isn’t desirable, but the design as a whole is in line with the kind of image the hotel is looking to portray.

My take: Instead of changing their Web sites, banks should rethink their branding efforts.

NetBanker reported recently on the success of BancVue’s Rewards Checking product. According to information that BancVue supplied to NetBanker, 381 FIs are live with BancVue’s checking account. Overall, there are 610.000 accounts open with $5.5 billion in those accounts — or about $9k per account. In addition, BancVue reports that more than 13,000 accounts are opened each week.

Put that in context with the success that ING Direct has had in the US market over the past few years with a simple savings account that pays above average market rates.

What does this tell you?

That rate matters (a lot). That having a branch on every corner might not be the “cornerstone of a customer relationship” (Vernon Hill, ex-CEO of Commerce Bank, said that). That some (many? those with money?) consumers might not want a range of products from their bank, but simply be looking for the best particular financial product that meets a need that they don’t want or need advice on, or other products to go with. That some consumers might not care about going whoo-hoo after visiting their bank, and simply want the bank to get things right in the first place, so they wouldn’t need service in the first place.

And that spending millions of dollars to create a brand image that isn’t supported by the online experience (and in many cases, the offline experience) or a solid understanding of the kinds of relationships that consumers want with their banks may be a poor use of scarce resources.

Technorati Tags: Banking, Marketing, Branding, Advertising

Report Card Advertising

Dear McDonalds:

So you’re advertising on report cards now, eh? May I remind you that we live in a one-to-one, personalized marketing world now? It’s not enough for you to just offer free happy meals on kids’ report cards. Instead, you need to customize and personalize your offers. May I suggest:

“We’re sorry that you haven’t done real good in English. Come in to McDonelds for a free order of frys anyway.”

“Only a C in Math? No problem, come to McDonalds and buy one Quarter Pounder and get the next one for double the price.”

“At McDonalds, we don’t put chemicals and preservatives in our food. Not that you would know the difference considering you failed Science.”

“Only a B in Gym? Get into shape with our Asian Salad With Grilled Chicken.”

I’m sure you can come up with some more. Good luck.

Sincerely,

Ron Shevlin

p.s. I almost forgot, I have one more suggestion for you. STOP DOING THIS.

Technorati Tags: Marketing, Advertising, McDonalds