Atomic Direct, LTD

Tech Needs TV

Offline Advertising is Necessary for Online Growth

Posted by Doug Garnett October - 29 - 2010 - Friday Comments Off on Offline Advertising is Necessary for Online Growth

If you are pure B-to-B or consumer marketer with extremely limited goals, then this article may not be for you. But if you need to drive growth in large markets, then read on.

And start by considering Angie’s List, Eharmony, and GoToMeeting. All are perceived to be pure “online plays”. Yet each surprisingly uses massive TV advertising campaigns to drive growth.

Dig a little deeper and we find that Zappo’s gets the highest online sales per customer when consumers receive printed catalogs.

And our list goes on. TV plays include GoDaddy, Vonage, and Hulu… I even saw a report recently that non-profits with extensive online interaction commonly see the highest donations from off-line efforts like direct mail.

But many in the ad biz have drunk the kool-aid of the cult of online advertising. At some point they bought into the idea that “all online” was the future. (In part, agencies buy into this because while it may not make their clients much money, it has tremendous impact on their bottom line.)

And now, rather than finally recognizing online limitations, social media fantasies have become the latest excuse for never leaving the web. (This, despite strong and conclusive research showing that consumers DON’T get new product learning from social media.)

Offline Media is Powerful. Most often, I’ve found that online purists haven’t experienced the power of traditional media… Power that moves markets… Power that drives mass results fast… Power that can be exceptionally cost efficient… Power that far exceeds what’s possible in the cloistered world of online, social media, mobile, email, and other media hyped “cool” options.

So why are so many online companies now relying heavily on offline media? Because it drives growth.

Online advertising’s limitation is that people have to know they want your product before it’s effective – they have to know what you make and why they might want it. Online resources are superb for searching out answers to questions and sometimes purchasing the product. But online’s generally a poor medium for driving out a message about something innovative and unusual.

This is critical if growth is your goal. Growth almost always requires getting your message out to new people, in fresh ways, in order to bring them to become interested in your product.

It’s fundamental: If you are an online player and want to grow, you need offline media.

Not that Apple is the perfect marketing example. But they clearly understand the limitations in online advertising. In fact, onliners have complained for years that Apple doesn’t spend enough of their advertising budget online.

Hmmm. Looking at their growth, Apple seems a lot smarter than those who suggest they need to do more online advertising. By observation, I think Apple figured out that succeeding online doesn’t require advertising dollars. And, they must have found that the bulk of their advertising dollars are most effective in TV and other mediums.

Even with targeted markets, the companies who thrive without off-line advertising are few and far between. So if you’re looking for growth in your online (or offline) business, then you should look first at your offline strategy. Because moving forward may require that you first look back.

Copyright 2010 – Doug Garnett

New Media Noise: Living in a Third World Airport?

Posted by Doug Garnett November - 2 - 2010 - Tuesday Comments Off on New Media Noise: Living in a Third World Airport?

I generally enjoy reading Bob Garfield’s work. So I read his recent AdAge blog post about new media with interest.

In this post he recounts being bombarded in a foreign airport by loudly shouted commercial offers. I know what he’s talking about — offers for time share presentations, people who want to be your “friend” so you’ll use their taxi, people who want to help with your luggage (for a fee), offers to sell you hats, sunglasses, food, … The list goes on.

As I read I thought: Bob, you’ve nailed it. Welcome to the world of new media – that cacophany of demanding voices violating your privacy.

But that wasn’t what he meant. He thinks the old world of media was a lot like this airport because it was based on interruptions. (I can sort-of buy that.) And, he suggests that future advertising won’t be that way. Huh? In fact, he implies a utopian vision that is so commercial-offensiveness free that humanity must be surviving without ever having to admit that society depends on commercial interests.

To be fair, Bob Garfield is reflecting conventional wisdom among the advertising elite. So let’s think about this supposed utopia.

I’ve seen something like it someplace. Hmmm. Where… Let me think. Oh, yes. Star Trek, Star Wars, and Avatar — all movies with utopian visions of the future created as an author’s fantasy – not by reality.

What’s the reality about new media’s intrusiveness? When you stop and really listen to new media, I find it intensely more intrusive and insistent than old. (And I know I’m not alone.)

Consider your mobile life. In the old days, apart from some outdoor advertising and point of purchase, once we left our homes, we were advertising free. Now it is the avowed goal of the tech industry to bombard us with advertising the minute we touch a mobile device.

Consider your ability to ignore advertising. In the old days, you could go get a beer from the fridge. Now, you have to endure that 15 seconds of pre-roll with a meaningless Old Spice ad just to find out if an online video is at all interesting. (Of course, I’m told that most people just skip those ads by opening other windows on their computers.)

Consider how new media advertising invades your personal connections like in social media. If I discuss woodworking projects with friends on Facebook, I’m followed for weeks by advertising for woodworking tools who want me to “like” them. GO AWAY!!! I don’t want them, don’t care, and resent the intrusion on my personal space. STOP IT!!!

Consider the new media “bait & switch”. Rather than honestly tell you “here’s an ad for a product we think you’d find interesting”, many agencies tell their clients to deceive through content. There’s an extensive literature about how to sucker consumers over to your website so you can bombard them with commercial messages.

Consider the lies. Lies travel farther and faster than truth in social media. So, the new advertising elite learn they have to reject meaningful & useful messages because they’re too complex – and because only a few types of messages will ever get seen in new media.

Consider how many messages bombard us. A couple of years ago AdAge noted that in the old days, we were presented 500 commercial messages in a day and research showed we remembered 1 or 2. Now, we are presented with 2,500 commercial messages in a day and research shows we still only remember 1 or 2. In other words new media, with its pervasive stridency, is training consumers to ignore advertising at a higher rate. And that means we’ll have to yell louder and more insistently just to be heard.

There is a fundamental societal flaw at work here. We used to have an unspoken agreement about advertising as a society. The agreement included ideas like “our society needs advertising to create and sustain jobs”, “consumers want to learn about products that are meaningful to them”, and “the ads pay for making good content”.

What made this work were specific media structures and limits on how advertising was used in those structures. Now the structures are changing. And those limits are gone so the best advertising agencies compete to see who can intrude on our personal lives at the fastest rate.

In a third world airport, the situation is different. The airport noise that strikes Bob (and myself) as so loud is part of their social contract. But it’s not part of ours and neither is the intrusiveness of new media.

The real issue is what we want for the future in our society. An airport cacophony that follows us everywhere? Or advertising that delivers both economic strength and quality of life? Only time will tell whether we get what we want. But without dramatic intervention, the captains of the advertising industry seem hell bent on rushing to the airport.

Copyright 2010 – Doug Garnett

“Most Consumers Don’t Want to Be Your Friend”: Six Axioms of Social Media.

Posted by Doug Garnett November - 11 - 2010 - Thursday Comments Off on “Most Consumers Don’t Want to Be Your Friend”: Six Axioms of Social Media.

We’ve been sold the grand myth of social media marketing based on some rather flakey ideas. In particular, the ad biz has somehow convinced itself that the vast majority of consumers have a driving desire to be a company’s friend. Now a study by the Harvard Business Review and the Corporate Executive Board suggests there are significant limits to a company’s potential intimacy with its consumers.

This study started by looking at consumer relationships with qualified counter help – like the people at an airline counter. In studying physical behavior and shopping behavior they concluded that people very often avoid idle counter help and opt for automated systems (like ticket kiosks or supermarket self-checkout). Building from this work, they researched other consumer relationships with companies – including social media. In the end, they conclude that the majority of consumers really don’t want to be close to most companies.

I couldn’t agree more. Consider my own situation. We have a lot of brands in the house. But if I remove commodity brands, there are only 200 to 250 brands where a significant connection is even a consideration.

But you know what? I don’t want to be friends with any of them.

Why would a social media connection with Dial Soap benefit me? Or Cascade Detergent? Or Sony for my TV & my DVD? Or Levi’s for jeans? Or Ethan Allen, Sherwin Williams, Dania, Ikea, Nintendo, Lego, or… It simply isn’t worth the social media and email clutter. (No, I do not want most of your brand emails.)

But there’s an even bigger shocker: I’m pretty passionately connected with my Apple products yet don’t even want to “friend” Apple. Why? When other people write about Apple it’s fascinating. But, their corporate communication is brochure copy (like it needs to be) and so it’s really not very meaningful in a relationship. Besides, I will go get information when I need it (it’s right there on the web).

And this leads to a set of key axioms about people interacting socially with companies. My reading of the current research points clearly to these axioms. But research into social media has been conducted primarily with wide-eyed awe and avoided the tough questions. So I know some of these are based on intuitive jumps more than steely-eyed review of hard numbers.

The six (6) axioms:

1. Most consumers don’t want to be your friend. They may like you. They may even love you. But that doesn’t mean they want to be connected with you online.

2. Consumers who will be your friend on Facebook or any social media outlet are a very small segment of your target market.

3. Consumers who will be your “friend” are usually not those customers who generate the most money for you.

4. The influence of active social media consumers is overstated. There is no reason to believe that consumers who will be your “friend” are important influencers – nor your best influencers. (This conclusion comes from some excellent research on the “Million Follower Myth” that I’ve written about in another blog post.)

5. The vast majority of consumers have at most a handful of companies or brands where they will build social connections.

6. The most powerful social media connections are through narrow social media – like your company’s social media site. It’s always been true in marketing that focus delivers higher returns. Somehow, we need to re-build that understanding in social media.

What does all this mean?

Social media is exciting. And it’s here to stay. As companies evolve their marketing, it’s very smart to plan a social media strategy. But social media agencies are using classic “FUD” salesmanship – casting fear, uncertainty, and doubt on your future “unless” you spend a lot of money with them.

In fact, there is a big danger of social media work taking both energy and budget away from more highly profitable investment opportunities. This danger is made higher by the consuming nature of social media work. I find that staff who work on social media become quickly hypnotized by their new toy and lose their sense of perspective.

So after all this, the first and most critical step I recommend for your company’s social media work is choosing where and how you will limit investment until social media is proven to return commensurate sales.

Copyright 2010 – Doug Garnett

Five Reasons Consumers will “Friend” Your Company.

Posted by Doug Garnett November - 12 - 2010 - Friday Comments Off on Five Reasons Consumers will “Friend” Your Company.

In my last post, I noted six hard truths or axioms I’ve developed about social media. And while these are sobering thoughts, it’s only by facing a medium’s weaknesses that you can truly leverage its power.

So let’s look at another sobering set of thoughts today. If we’re going to look at the people who will be your company’s friend, what motivates them to become your friend?

Reasons People will Friend Your Company

The best starting point is to look at the value they get from connecting with your company. My team finds that there are five primary categories.

- Coupon Clippers. Many consumers “friend” companies to seek discounts and deals. In other words, they are the coupon clippers. Interesting. Coupon clippers are powerful short-term revenue opportunities. But historically they have less brand loyalty and are of lower lifetime value to companies.

- Party Animals. Many consumers friend companies because of clever “entertainment” (typically unrelated to product value). This is especially true for brands who make entertainment the focus of their online experience. Truth is that a significant portion of Party Animals are unlikely to ever use or purchase the product. One great example of Party Animal social work was this year’s Old Spice campaign. Their online campaign generated massive social media interaction and ad business hype. But, it appears to have had no detectable impact on sales.

- Groupies. There are some consumers who become professional “fans” – groupies. And, this happens for every company – not just the “hip” ones. The volume of groupies can be increased with effort. And, they are a lot like rock star groupies — emotionally significant to the company, but they won’t fill an arena and they won’t make your numbers for the year.

- Customer Care. Many consumers connect with companies to seek customer service. One article I read this year pointed out that this is akin to “protecting your investment”. If you own a Toyota and are concerned about this year’s safety problems, you are more likely to “friend” them just to be up-to-date on recall notices.

- Brand Engagers. Some connectors are truly engaged with your brand and will use social media to maintain contact. My axiom is that for broad based social media (e.g. Facebook) this last group is important, but unlikely to be more than 10% or 15% of your total social media connectors.

What does this mean?

I can’t tell you what portion of your social media “friends” will fall into each category. That will depend on many factors including the design of your efforts to attract friends and the fundamentals of your product, brand, and category.

But when you look at that group that gathers around your company, some generalizations are quite reasonable.

1. The hype surrounding social media far outweighs it’s economic value to companies. I think is quite common to find that no more than 5% of your target will even entertain a social media connection. The further fragmentation into five categories makes each segment quite small.

2. As a result, it’s quite easy to spend your money chasing around after your least valuable consumers.

3. If you want your social media relationships to be significant to your company, then you need to avoid the hype and the easy answers in creating social media connections. Instead, take some lessons from the direct marketing world and embrace the social media efforts that build solid & long-term relationships.

In no way do I think you should stay away from social media. But whatever your efforts, enter social media with your eyes open.

Copyright 2010 – Doug Garnett

“Free Internet TV” Will Hurt Consumers

Posted by Doug Garnett November - 21 - 2010 - Sunday Comments Off on “Free Internet TV” Will Hurt Consumers

Claims of “FREE!” drive purchases of cheesy TV products from Shamwow’s to those (supposedly) Amish heaters. But somehow, it escapes notice of the tech press that equally cheesy claims of “free” run deep amid marketing of the internet.

Free music, free newspaper articles, free magazines, and now supposedly free television. Everybody offers free. And it’s no surprise that consumers go for it.

In fact, this idea of making millions by giving things away was found in many of the irrational “business plans” that dotcom’s claimed would make their investors rich. It didn’t work then, but maybe things have changed.

How is “free” going for Wikipedia”? Wikipedia is the poster child for internet “free”. Except they are deep in the midst of a campaign attempting to raise $16M in donations just to keep their doors open. It’s a campaign that pitches quite hard. Makes me think that even for a donated content online Encyclopedia, “free” isn’t quite as powerful a business plan as we thought.

How is “free” working out for newspaper and magazine content? Bob Garfield wrote an AdAge blog entry recently about the incredible dark side of “free” print on the web.

He notes that print on the web is driven by sites that “aggregate” (bring together) content. Where do aggregators get good content? From newspapers or magazines. Except aggregator sites deliver content to you for free.

In a fit of business insanity, internet copyright anarchists imply that revenue from the hated banner ads on the site of the aggregator somehow trickles back to pay for the hard work it took to create that content. (Hard work is required to make well written, well researched, well fact checked, and well published content.)

Well, the revenue doesn’t trickle back. Garfield notes how “free” access has undercut the economic model that created good content in the US. But he also notes that even those aggregator sites are struggling to keep in business. Guess this model is so flawed that you can’t make money even when giving away content you didn’t make.

How would “free” go for TV content? Don’t expect too much. And note that it’s a double “free” idea that is being used to entice consumers to internet TV – payment free and advertising free. (Secondarily, there’s the idea that they can watch anything they want, anywhere they want, and on any device they want. But while consumers will pay for DVR’s, there’s no evidence of willingness to pay for it online.)

Double “free” is publicized with massive money from manufacturers of internet TV sets, creators of internet TV sites, the venture capitalists behind them, and the tech research agencies paid by the venture capitalists – all drooling at the idea of tapping TV’s big old vein of pure financial gold.

And, frustration with out-of-control cable TV costs means there’s very high consumer interest in cost savings. But do consumers really want what double free TV would mean? I don’t think so.

Double “free” TV over internet will kill content. The existing economic model supports an incredibly well developed, sophisticated, sometimes dysfunctional, but essentially effective eco-system – an eco-system that creates good TV, offers the single advertising medium which delivers the best economic impact and delivers most of what consumers want.

The net results for consumers would be the death of programming. Google claims they’ll stitch together YouTube content to make programming (of course, selling their own advertising time within that content). Don’t expect much. The existing ecosystem turns out everything from niche to mass hits – 30-Rock, The Daily Show, Survivor, Amazing Race, NFL Football, Antiques Roadshow, and CSI Miami on a big screen (I just can’t include “Darth Vader, Night Clerk” in that list). But it costs millions to deliver those shows – often over $1M per episode.

There’s some good news for TV. As Mark Cuban has pointed out, TV is different from print and music. Networks ARE aggregators. That means TV networks have been fighting this type of battle all along. They also seem to have learned from print and are being quite stubborn about protecting their right to get money in return for all the money they invest. Consider

- Hulu (funded by networks) started “free”, but is beginning to use subscriptions.
- The networks fight regularly with cable operators to maintain a viable economic model – even if that means people don’t get to see the World Series. We have to assume they’ll use all means to fight against a double free idea that hurts their business.
- An example of this seems to be that while networks work with Apple, they don’t work with GoogleTV. Maybe they know Apple wants to create viable media business models. But it seems the only reason to create GoogleTV is to try to steal advertising revenue that currently goes to the networks – revenue that pays to for programming.
- Now Hulu (funded by networks) has made it so that you can’t watch their programs on GoogleTV’s.
- Network testing seems to indicate that consumers are willing to watch online TV with traditional advertising breaks. In other words, the double free idea doesn’t even seem necessary for internet TV to work.

Internet TV should have a tremendous future and it will be stronger if the industry stops the promise of double “free”. Internet TV’s future comes with the truly exciting opportunity: integrating programming with interactive features that make the programming more valuable.

But sadly, companies aren’t talking about delivering more value. They’re getting wrapped up in dead ends – like removing advertising when there doesn’t appear to be monetized market power created by doing so.

So next time you hear someone talk about how great it is to get free programming on the internet, know that they’re really talking about a future of really bad programming. You may not like programming today (it’s fun to complain). But just imagine what it would be like in that free future.

Copyright 2010 – Doug Garnett

Smart Choices Make Online Videos that Drive Web (and Retail) Sales

Posted by Doug Garnett December - 1 - 2010 - Wednesday Comments Off on Smart Choices Make Online Videos that Drive Web (and Retail) Sales

What video content does a shopping consumer need and want?

Marketers are encouraged to fill websites with exotic videos made with the most expensive production value. But too often those videos aren’t useful to consumers. And most manufacturers can’t afford them if they have extensive lines of products.

So how can you create online videos for your product line with today’s tight margins? Let’s focus on one critical situation: when online retail or online catalog sites display video to someone looking at your product. (This video is often perfect for in-store use as well.)

Learn What a Consumer Needs by Considering How They Find Your Video.

In the vast majority of cases consumers follow the same path. First, they browse the site to find your product or arrive at your product on the website with search (local or global). In other words, they’re focused on finding a product much like yours.

On that catalog page for your product they find a small list of important things about the product, photo’s, a range of specifications, and the price. Somewhere on the page they finally see your video after clicking an embedded link.

So think about it. Before the consumer gets to your video they already know a lot about your product and have made quite a few shopping choices. That means they need a very specific type of video. But fortunately, one that can be made on a smaller production budget.

How Do You Make Effective Online Catalog Videos?

A few simple rules should guide the content you create. But most importantly, choose what you show and say to respect the things your consumer already knows about your product. Other thoughts:

Focus on the things that need moving picture – not the things that are better said on the printed page. For example, specifications are better on your web page – not in the video. Instead, deliver visual demonstration that shows consumers what they’d never understand any other way. With tools and hardware, for example, the simple act of a hand picking up a product answers important questions for consumers because it puts key features in context.

Don’t ignore the simple demonstrations. Consumers often need to confirm what’s written with simple visual demonstrations. And don’t let your product teams cut them short just because the producers (who aren’t your customer) think they might be dull.

Use animated graphics to show how your product works and reveal what’s hidden. These animations are much more important than animated logo’s. (Yawn!) And don’t cut the animations short. Nothing bugs me more than an animation that only runs for 1 or 2 seconds.

Your online shoppers may be shopping for their business or for personal use. Don't narrow your options unwisely.

How Do You Make Online Catalog Videos That are High Quality AND Cost Effective?

This is your the more difficult challenge. Trying to do too much on a budget that’s too small wastes your money. At the same time, many production options will break your budget on just one video. Here are some thoughts.

Avoid the “default” choices of production companies. Most video producers approach every project seeking to create the same thing: an expensive stand-alone video with lots of bells and whistles your consumer doesn’t need.

Hire professionals who understand how to create this specific type of video. The web is filled with video footage where we can’t see what’s going on or where the video doesn’t enlighten us. YouTube seems to have engendered a wealth of bad angles and bad lighting shot from too far away (or too close) with too much clutter in the frame. Remember, just because someone CAN shoot video doesn’t mean they should.

Focused on the visual demonstrations that drive sales. And make sure you know what sales points you need to make and what objections you need to overcome in the video. Then work with your agency or production team to find the best ways make that happen.

Make a baker’s dozen. One web video usually can’t cover the product lines offered by most manufacturers or retailers. So shoot many at the same time. With related products, my team has become quite skilled at combining shoot days, props for demonstrations and edit resources to create these retail videos at high quality but for much lower prices per video.

Having said all this, effective video isn’t cheap. If anyone claims they can shoot a group of effective, high quality sales video’s for much less than $4,000 per video, you’re not likely to be pleased with the result.

The Online Video Age Offers Tremendous Opportunity

With wise choices, manufacturers can get the effective and high quality video they need for very reasonable prices. Even better, these videos can make the different between failure and success. But you must stay focused on knowing the mind of your consumer and making the smart choices that delivers the video that leads them to buy your product.

Copyright 2010 – Doug Garnett

People Ignore New Media – Much More Than They Ignore Traditional Media

Posted by Doug Garnett December - 6 - 2010 - Monday Comments Off on People Ignore New Media – Much More Than They Ignore Traditional Media

Media Daily News recently published an article by Wayne Friedman covering key statistics about viewing of advertisements.

It shows a striking truth: 63% of people say they ignore all internet ads while only 14% say they ignore all TV ads. And even more interesting: young consumers (18 to 34) ignore banner ads much more than they ignore TV ads.

The statistics in the article are from a specific study (I’ll let Wayne’s article give you the details). These numbers are confirmed by those reported through observational research: Web ads are ignored at very high rates.

Truth is, it makes sense. Think about it – do you pay ANY attention to ads on the web, mobile, Twitter, or Facebook? (The only reason I do is as an advertising guy to see who’s losing their money by paying for that space.)

New media advocates are shameless in the things they claim for the web – even going so far as suggesting all anyone needs is the web. And they yell so often and so loudly that they often drown out sanity and reason at even the most sober of companies.

And if anyone suggests they’re wrong, they always fall back on the idea of change – that the young & hip ignore everything but the web so if you want a future you’d better do everything they say. But the statistics don’t support them. And practice doesn’t either.

Truth is that for all the unusual capabilities of new media, it isn’t strong enough to build and maintain mass markets. Two reasons…

1. New media are all specialized meaning they work best reaching smaller and smaller fragments of markets.
2. New media are very poor for reaching out to people who don’t know why they’d care about your message. Once they know about what you have to say, you might begin to have some web success even though they remain highly fragmented.

In other words, if you have a new product, it’s generally dead via web unless you can use the web to get…um…well…traditional media like the TV news guys to report on it.

If you want more proof, read my post about how online companies are increasingly turning to offline advertising – because they can’t get enough success otherwise.

Then look at your own balance between online and offline advertising. It’s likely that a return to using offline advertising in a smart way will improve your company’s economics.

Copyright 2010 – Doug Garnett

The Key Truths About Social Media Are Already Known by Direct Marketers

Posted by Doug Garnett December - 9 - 2010 - Thursday Comments Off on The Key Truths About Social Media Are Already Known by Direct Marketers

Social media experts have spent the last few years telling us how hard it is to calculate the value of social media connections to monetize their efforts. I’ve read their posts and articles with high interest – because we all want to learn where social media has the most substantive value.

But it’s time to realize there is no hidden magic to social media. The fundamentals for estimating the value of social connections are the same fundamentals that have been used in direct marketing for over a century – lessons Claude Hopkins reveals in his writing about mail order advertising in the early 1900′s.

Consider a post I read the other day. It was published in a major national media business newsletter. And it suggested (surprise surprise) that mere viewings might not reflect any business value for online video.

Didn’t anyone learn marketing basics? Of course mere viewings don’t mean much and we know that without an intensive direct marketing background. It’s part of basic communication theory – something we teach in the “Introduction to Advertising” courses at Portland State University.

Truth is that when you have a bar that is far too low for consumer engagement, then everybody gets engaged and nobody ever gets married.

So let me suggest a new rule: Before you can call take on the title of “social media expert”, you have to take a direct marketing class. Here’s some of the lessons that would be taught in that class:

- Mere consumer action has no value. Quite often, in direct marketing, reducing the number of consumers who act will increase your net profit. I once had a campaign that drove leads at $25 each. We modified the creative so that it chased unqualified leads away. The lead cost doubled to $50 per lead, but the net revenue result was 5 times higher – that’s right FIVE times higher.

- Attracting people with entertainment often attracts thrill seekers who won’t become valuable consumers. The subscription folks have known this for decades. Heavily incentivized introductory subscription offers always generate the highest number of new subscriptions…and the lowest number of long term subscribers. So if you are attracting social connections with “cool video” (like the Old Spice campaign last summer), you’re not likely to see any business result (which is exactly the end result of Old Spice’s 2010 campaign according to the AdAge analysis).

- Marketing IS all about selling product and it pays to be honest about this. Selling doesn’t just happen – to get sales you will someday have to ask for an order. So it may feel great to start with noble intentions to use content to get engaged consumers who seek connection with your brand, but you have to sell something at some point. Worse, what consumers hear from these noble campaigns isn’t at all noble. Too often content is used as a “bait and switch” to sucker people into connecting with a brand. By contrast, direct marketing profit history suggests that if you are honest up front about your intentions, consumers respect you for it and you will generate higher revenue in the long run. (Consumers KNOW we’re in the business of selling things. So it frustrates them when we try to suggest we’re not.)

- It’s easy to raise expectations so high that your company can never meet them. Let’s learn from loyalty efforts. Programs around the world claim: “We’re your best friend forever – just tell us what you want.” But no company can deliver what this implies. So, with the exception of coupon clippers who belong to lots of programs, the average consumer has probably found at most 4 or 5 loyalty programs that deliver what they consider significant value. (For me, having joined 30 or 40 loyalty programs, only a few programs deliver any value – United MileagePlus, Delta Skymiles, Amex Rewards, Avis Preferred, and, um, uh…I don’t have any more.)

So let’s cut through the social media BS. There are already hundreds of thousands of articles, books, and reports created by hard working (and very smart) direct marketers that lay out the fundamental models for analyzing the impact of social media investment. It’s well past time for them to be applied.

Copyright 2010 – Doug Garnett

How Segmentation Becomes Fragmentation: Online Advertising’s Incredible Blind Spot

Posted by Doug Garnett December - 16 - 2010 - Thursday Comments Off on How Segmentation Becomes Fragmentation: Online Advertising’s Incredible Blind Spot

In the late 1990′s, the tech industry hype machine went into over-drive telling us that the web would replace retail and become the biggest sales channel for every product on earth.

Of course, it didn’t happen. Today, brick & mortar retail dominates purchases – and does so while using the web as one of many communication options and as a small, but important, sales channel.

What’s the hype machine telling us about advertising? The same hype machine has re-emerged and is leaping at social media, viral campaigns, and online video as the magic that will rescue the web from a minority role in advertising. (This would, of course, bring all those juicy advertising dollars to the company’s and their VC’s who are behind the hype machine.)

Once again, these broad claims are bunk. And, with beautiful irony, the theory of web dominance in advertising breaks down because of what the hype machine also tells us is the web’s biggest strength: nearly infinite segmentation.

Web users sign on, search through a small number of search engines, then scatter around the web faster than particles pushed outward from a supernova.

Web advocates have rightly noted that this makes the web ideal for targeting – claiming that online promotions can have laser-like accuracy. (This accuracy requiring, of course, various forms of passive and invasive tracking of your every online action.)

Segmentation and fragmentation are two sides of the same coin.

If all we expect of the web is a highly targeted minority role in our marketing mix, then the web has segmentation. Or if you are selling a niche B2B product to a technical audience (like IT), then the web offers segmentation – and highly valuable segmentation.

But segmentation becomes fragmentation when we consider the idea of replacing advertising’s biggest gun: television. When compared with TV, web audiences are not merely fragmented but shattered into billions and billions of tiny shards. TV’s opportunity to move millions of consumers to action simply doesn’t exist on the web.

Consider it this way. If on it’s best days TV creates a power of 100, on its best days the web creates a power of 1 to 5. As a minority share of an integrated marketing plan, this “1″ is important. But no matter how hard you try, the web’s 1 can never replace TV’s 100. (Or print’s 75; or direct mail’s 30 or radio’s 60 or outdoor’s 40 or…)

Sadly, if web advertising is all you’ve ever known, crawling around to gather enough shards to create micro-segments from nano-segments might make you think you are doing something big. (After all, it’s a lot of work and mere busy-ness can easily mask ineffectiveness.)

But if you have travelled the much wider world of traditional advertising, you’ll realize it’s impossible to use online shards in mass advertising to create anything more than a very nice minority role. (And here I should note that Apple is just one example of a savvy advertiser who knows this and relies heavily on TV while using internet advertising in a limited role.)

But heck, many web investors don’t want to hear this. And, just so, they’ll fire back. With what? Probably a Forrester research report showing an astronomical 20 year growth curve for the NEXT web invention – perhaps location based search engine optimization delivered via socially viral online video with a twitter core hosted on a cloud. Yup. That’s the ticket.

It’s time for the ad biz to grow up and confront the tech machine’s hype with advertising reality.

Copyright 2010 – Doug Garnett

Reject Bah Humbug; Embrace the Physical Holiday Card

Posted by Doug Garnett December - 20 - 2010 - Monday Comments Off on Reject Bah Humbug; Embrace the Physical Holiday Card

It’s holiday time – when good cheer arrives from people you’ve worked with all year. When old friends get back in touch with you. When it’s great to be reminded of the relationships you’ve built and to touch base with people you haven’t had reason to contact in the past bit of time.

And so, I love the business version of the holiday card tradition. That’s right. You remember physical cards. They are printed (that’s p-r-i-n-t-e-d) with a process that involves applying ink to paper. It’s a really interesting process if you haven’t ever seen it.

Even better, it creates an item that spends longer in someone’s consciousness than the average holiday Tweet (.0005 nano-seconds) or the average holiday mass eMail (.0010 micro-seconds). It fully “engages” the recipient because it’s physical. (To be clear, that means NOT displayed on a 3D TV – but something that really exists in 3 dimensions.)

Sadly, this year the holiday card is scarce. My trend-spotting hasn’t found a single reason. Some businesses seem to think they are being “green”. Some businesses may be choosing frugality in recognition of economic hard times. But a great many seem to have opted for the low-hassle/low-impact e-card.

Don’t send ME an e-card. I’ll never know you did because I delete Holiday Spam without reading. Scary thing is that online action lets us THINK we’ve done something – even though we most often haven’t as online holiday actions are forgotten at a very rapid rate.

Then, there’s donations. Over time I’ve become quite turned off by the “we’re donating” notices. Certainly the theory is based on wholesome action. Yet something still strikes a wrong note.

Perhaps it’s the fact that I have no connection to where the donations are going. Perhaps it’s the fact from many companies the notification of their donation is self-aggrandizing. Perhaps there’s an underlying suspicion that these companies only donate in order to get more business – not because they really care.

And in the strangest donation ploy I’ve seen, this year we received a donation oriented card – except the company wasn’t donating. Instead, it asked us to donate on their behalf to their specific charity. What? Is that supposed to be “authentic” or some other highly hip silliness?

Here’s the thing. The simplicity of a physical card has presence. A physical card communicates far more than an ecard. And it’s meaningful to the recipient. At an average cost of $1 to $4, it’s probably the single most cost effective way to have a brief touch with the people involved with your company. And even better, it sticks around.

So next year, when your company decides to Tweet it’s holiday greetings, perhaps you should remind them that Tweeting would be fine if customers were automatons. But there’s nothing like a physical card for communicating with individuals.

Copyright 2010 – Doug Garnett

Doug Garnett, DRTV and Technology Industry Expert

Doug Garnett is founder and CEO of DRTV agency Atomic Direct and a leading expert on innovative uses of DRTV, infomercials and other in-depth TV and non-TV messages to build brand and drive sales.

Doug has been working in and around the technology field for 27 years. After starting in aerospace, he spent 5 years selling and marketing supercomputers. Since shifting to advertising, his clients have included AT&T, IBM, Apple, Disney Mobile, Ugobe, Presto, and Netpliance.

Doug sits on the editorial board of Response Magazine, is an adjunct professor of general advertising at Portland State University, and is a member of the Jordan-Whitney Greensheet Panel.

Join the conversation or just see what Doug has to say about the latest in TV and advertising.

View Doug Garnett's profile on LinkedIn Follow spyktweet on Twitter