How monthly subscriptions have infiltrated your life

The publishing site Quartz.com laid off more staff this past week. It’s not that Quartz hasn’t found a revenue model; it has already decided its best revenue future is via monthly subscriptions. Quartz like many others knows that bleeding you bit by bit over time is much less painless and less noticeable. The risk is having people experience financial pain by a thousand cuts.

In the past publishers preferred to get their subscription revenue on an annual basis but that also was a way for them to deliver controlled circulation for advertisers.   As print advertising continued to live but wane, actual subscription revenue became increasingly important.   The ‘get a few free’ before demanding pay-to-view is now the default for many publishers.

I’m quite fine with publishers and content distributors charging real money to access their platforms and associated content. But there’s only so many platforms that people can possibly follow and derive value from. We’ve come a long way from twenty-somethings having expenses outside of food and rent be not much more than a phone bill and a power bill. The monthly subscription fees that add up for you today are probably much more than you are aware of or would care to admit.

Clearly there’s more high quality content out in the marketplace than ever has been the case prior. It’s just…well who has the TIME to view it all? Read it all? Listen to it all? When you think – ‘hey’ it’s only $5/month’ you are likely not thinking that you will try it for a month and if you don’t get your $5 you will cancel. A year later you have paid $60 for this subscription that you hopefully have used to some degree. $3/month here, $6/month there, it all adds up more quickly than you might realize. Add your precious wireless bill to that, Hulu, or cable, or Dish, or whatever, and for an individual, monthly subscriptions are on the way to being $200 or more.

Do I have an answer? No and I don’t know that there is an ‘answer’. Maybe controlling the urge to sign up would be a place to start. Subscription deals are not always so easy to cancel if you know what I mean. But if the content is really good even only some of the time there’s that feeling – FOMO if you abandon ship. I’ve got some work to do on that one. Since it’s the Fourth of July Holiday this week I will celebrate by NOT reading everything.

 

 

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Vitamix blenders show how it’s done to build a successful brand

So how does a company like Vitamix proudly charge WAY more for its product than almost all the other market competitors?   Without a substantial advertising budget? In the past Vitamix has run TV spots – but I’ve not seen one air in real time.   There are other brands like Blendtec, Hamilton Beach, Lancer, Waring, Bullet, Ninja, Froothie, and Vortex, but Vitamix remains the market leader.   Almost all of the competition sells at a lower price and in some cases a MUCH lower price.

I remember when we bought our Vitamix blender after seeing it demonstrated at Costco. The in-store demo was cool and it was clearly expensive at between $400 and $500. We also bought it more than eight years ago. It’s a little battle worn but works just as well as it did the first time we used it. For something that gets used in our house every day, multiple times per day sometimes, the expensive one time cost has ended up being not so expensive. The noise that it makes is loud and obnoxious when it’s crushing ice and whatever else we put in there. But it works. And it’s generally very easy to clean.

I found this review on CNET and I had no idea that Vitamix had been around for more than 80 years and was a very early TV advertiser – an infomercial at that! They were originally a direct response company and that kind of warms my heart!

William Grover Barnard, the founder of Vita-Mix, released his company’s first blender in 1937, but it wasn’t until television came around that Vita-Mix was able to introduce blenders into the American vernacular. Buying 30 minutes of airtime on WEWS-TV in Cleveland, in 1949, Vita-Mix ran what the company says was the first-ever infomercial — before long, blenders were flying off of the shelves, and Vita-Mix was rerunning the ad in markets across the country.

Today, the Vitamix craze continues, with a small army of brand loyalists who swear by the things, insisting that they’re worth every penny. That’s quite a claim, given that a model like the Vitamix 7500 will cost you exactly 52,900 pennies ($529). We’ve already looked at some impressive blenders from competitors like Ninja, Breville, and KitchenAid, all of which will cost you around $300 less than the Vitamix. And don’t forget about the ultrapowerful Blendtec Designer Series WildSide Blender, of “Will it Blend?” fame — it’s competing with Vitamix too, and at a price of $454.95, even it costs less. Is a Vitamix blender really a justifiable purchase?

The article goes on to note:

For some, I think it will be, but for most, it’s probably an unnecessary splurge.

For me the # 1 reason Vitamix leads the pack is that VITAMIX CLAIMS TO BE THE BRAND OF PROFESSIONALS – Vitamix has claimed the ground that it is and always has been the blender of professionals. It’s very, very powerful. Take a look if you visit a cocktail bar and more often than not Vitamix is the blender of choice. The fact that Vitamix can take the almost constant use in a bar or restaurant, is a big confidence builder for non-professional buyers like me.

For those with the means, it’s rather unsurprising that people will pay 3x or more for a Vitamix than other products on the market. If you can afford the best why settle for less? Yet the durability of the product has proven to me that it is more valuable over time. I am sure that a Hamilton Beach blender of the past or an Osterizer of the past could not handle the punishment we put the Vitamix through. Today those companies have ‘pro’ series blenders that are much more powerful than the versions of 30 years ago. I could not find one Osterizer priced above $100. There are none as powerful as the Vitamix in terms of horsepower. But I am guessing they work just fine for most home uses. As for their durability I can’t say as we’ve never used a blender as much as the Vitamix nor have we consistently challenged our blender with ice, frozen fruit, whole vegetables etc. so I have no frame of reference on how these less expensive blenders hold up.

Blendtec which is referenced above, did a brilliant advertising campaign starting back in 2006 called ‘Will it Blend’ and they would blend unusual items to show off the power of the Blendtec. It was fun and did a great job demonstrating the product. Blendtec is the closest competitor to Vitamix reviewed by Consumer Reports –  and other comparative sites like Blender Versus … They cost about the same. Vitamix has more market share and has consistently good ratings.

How long should a blender last? If my personal is any barometer – a long time as I recall having blenders last more than a decade. And in pre-smoothie days, we never put the older blenders through what we now routinely do with the Vitamix.

Product demonstration as advertising and excellent ratings and reviews have enabled Vitamix to stay on top even without what might be seen as traditional advertising. Coming from the high ground Vitamix occupies, Imagine what they could do if they did?

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Hong Kong’s future is pre-ordained

HK protests June 2019Hong Kong is part of China. That may seem obvious and yet recent news has confirmed for me that the Hong Kong of the not-too-distant future will be nothing like what people remember.

Having traveled to Hong Kong more than a handful of times, I regretfully have not been there in nearly 5 years as my professional travels have not included Hong Kong and China for some time.  Now this week, as nearly everyone has seen, Hong Kong is experiencing new protests from citizens three years after the ‘Umbrella Movement’ or ‘Occupy’ movement ended nearly five years ago – with no changes made to the way electable candidates were chosen.

I will keep saying that Hong Kong is one of the most interesting cities I’ve ever visited. It’s a fascinating mix of cultures, history and human behavior and there’s no place like it elsewhere on the planet. The current protest movement centers on the possible extradition of Hong Kongers and anyone visiting HK, to China. While the current Hong Kong Governor Carrie Lam has seemingly backed off on the impending vote, the die had long ago been cast, as the Chinese government remains fixated on ‘managing’ Hong Kong since the handover from the British in 1997. Years ago my friend Tom who lived in Hong Kong for 5 years remarked that China would rather have Shanghai as the financial center than have it be Hong Kong. It made sense to me at the time and still does today. That makes me sad. People that I know have told me that Hong Kong is definitely ‘not the same’.

The function of Hong Kong as an international financial center has been eroding ever since China re-took control more than 20 years ago. The Chinese government is smart. Smart enough to know it could not just arbitrarily shut down Hong Kong as a banking and finance center. However that does not mean that China can work to deemphasize Hong Kong’s importance. Changing laws to make Hong Kong more ‘Chinese’ have been part of the effort.

Westerners like myself can be more than a bit melancholy when thinking of the way Hong Kong was in 2007 much less 1997 and before. The mix of Europeans, local Chinese and all kinds of Asian people is what makes Hong Kong such an interesting melting pot. The melding of food cultures is particularly amazing in Hong Kong. The area itself from Victoria Peak to Kowloon Harbor is both beautiful and sometimes mysterious. Trips to Lantau Island and Macao are very pleasant memories for me.

What happens next will be up to the Chinese Government. However it’s inexorable that China will continue to exercise more controls on Hong Kong as there’s little or no chance of any form of a truly ‘democratic’ Hong Kong happening under the current Chairman if ever. I am hoping that ten years from now, when visiting Hong Kong, it will have echoes of the diversity of culture and interaction that has been its hallmark for such a long time. Hoping for, but not counting on it.

 

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Direct response has to go beyond ‘just get the order’

In the classic sense, direct response has always been about getting the first order, meeting or beating breakeven, then keeping that new customer in the funnel long enough to actually make a profit. Keeping customers in for a couple of cycles and THEN losing them was acceptable.  Winners and losers are the only scorecards. CLTV – Customer Lifetime Value is the scorecard of consumer direct response. At least it used to be.

It’s not that CLTV has become unimportant, but the importance of customer satisfaction has become the new driving force as inertia is no longer a strong enough force to keep customers from canceling and saying good-bye. There are a number of reasons for this which include increased consumer sophistication and ease of returns on platforms like Amazon.com. Returning something used to be a much bigger hassle than it is today. That puts power back in the hands of consumers (a good thing) and forces marketers to deliver a better product, offer better service, and create a sense of trust between the customer and the company.

As a side note this does not mean I personally like getting emails from EVERY Amazon company from which I buy something asking me about my ‘experience’ and also asking how many stars would I give the company. I received something I bought in the mail when promised, as promised. There was not one exceptional thing about the ‘experience’. And that’s fine! Marketers on Amazon could do a much better job of following up than asking for a rating every single time.

Yet it’s not a bad thing that companies from which I buy things on Amazon are interested (seemingly) in my satisfaction. It makes them try harder. Although were I to be unsatisfied, I surely would not be waiting for a rating email to get me to contact the company to try to rectify the problem.

I am seeing this from friends, customers, and associates of mine who are longtime direct response professionals. For them the days of ‘go get the order and we’ll hang onto them as long as possible’, whether that be by mail, TV, radio, digital or otherwise, are waning. The idea of creating a brand – and one of high value, is finally intersecting with the transactional nature of direct response advertising. This can be seen in the approach of the new guard of direct response advertisers like Casper, Harry’s, Dollar Shave, Warby-Parker and others. The products from these companies are for the most part unexceptional. The creation of a cool and interesting brand along with compelling offers (a big direct response element) makes for a deeper and longer lasting customer relationship. These companies will have to continue to deliver value for their customers even when the customer is not an active buyer. You might not be in the market for another mattress but there are other bedding products that Casper would like to sell you until you’re ready to buy another mattress.

Even if the model is to create and sell a variety of products direct-to-consumer, creating a strong brand to support product sales is more important today than ever before. It’s where I’ve always stood and where we stand as a strategy and execution shop. We’re in the right place at the right time and the trend in my view is positive.

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Medical Device Marketing and Advertising are two different things

It’s different than advertising

The back and forth between sales and marketing in companies have been around from the start of corporate business enterprises.

Our shop has done a great deal of medical device advertising and promotion. We’ve helped internal marketing departments with messaging clarity and brand consistency. The two are symbiotic but far from being alike. Advertising and promotion for medical devices is newer than for pharmaceutical products.

Most medical device companies that I’ve encountered have been and remain focused on what they term as ‘marketing’. This includes creating the value proposition (super-critical), as well as the various conduits to sell/market the device (i.e. hospitals, medical device distributors, surgeons and practices directly). These are no small tasks and are made more complicated in considering clear demonstration of the patient benefits, patient privacy, and yes, reimbursement. What they are not is advertising and promotion for the brand, to patients or even to providers and practitioners.

Does advertising for pharmaceuticals actually work? In 2019 the total spend on pharmaceutical marketing and advertising will be more than $30 billion.

Were it not effective that number would be decreasing not increasing. I’m not here to defend the incessant stream of Direct to Patient advertising on traditional TV, digitally and otherwise. It’s often amazing to me to see so much pharmaceutical advertising while watching television. Televised live sports are a hotbed for pharmaceutical advertising, since it is viewed by older (more than younger) men.

We were early to the idea of direct-to-patient advertising and promotion for medical device products and brands. We felt confident that since the results were very positive, (more inquiries, more procedures), more of those device companies would be interested in not only building a great internal and external sales team, but they’d want to support that team with consistent brand messages to patients and professionals. Important Note: Those messages are never the same.

Advertising to patients and professionals is fuel to support your sales team’s efforts. But it’s even more than that. Consistent advertising creates a stronger brand and builds confidence both for patients and practitioners as well as the sales team. In the medical device industry things have been done the same way for a long time.

It’s not natural to think about promotion of a medical device to patients since the actual sales are not made to patients but rather to professionals (see hospitals, distributors, and practices above). This explains a general reticence to make advertising and promotion one of the legs of a device’s marketing and sales effort. Because pharma has been so successful using advertising to drive patient and professional inquiries, I felt it to be only a matter of time until medical device companies followed suit. Over the five plus years we’ve been working for medical devices it’s surprising that it still is not happening with any regularity.

The trap is that in the past, advertising and promotion of medical devices direct to the patient has not been employed so there’s little track record of success (or failure). Therefore device companies may be reticent to move forward. However, today with patients and professionals having the ability to exhaustively search the web for information, all are able to become more informed about various conditions, treatments, and options. Consequently device companies are missing the boat by not trying to build their brand’s awareness with the patient.

Medical device sales are by nature, difficult. They can be aided by advertising and promotion. All that is needed is a budget commitment over time. One other note, it does not require pharmaceutical-like mega-budgets to create, deploy, measure and manage. Just a willingness to test and refine over a defined period.

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Wireless earbuds – wearing them and hating them at the same time

You see them everywhere on the streets of Manhattan as well as in and around major cities in the United States. The wireless earpod craze started with the Apple Airpods and Apple as usual has done a very good job of delivering on its brand promise.

Since I am an Android guy when it comes to phones, the bizarre-looking earpod equivalent does not exist for Samsung and other non-Apple users (which still make up more than 50% of the mobile device owning population). After some inexplicable period of resistance, this week I broke down and bought an inexpensive pair of earbuds from Weepo , (not the highly regarded Galaxy buds). No I had never heard of them before. But they were $45. Apple Airpods are more than $150 and Galaxy buds are around $130. I didn’t know if I would like the earpods so spending $100 less was meaningful.

I’ve only been using the Weepo US X a couple of days and I am not sure if I love them or hate them. Part of my ambivalence is borne out of the fact that ever since the Sony Walkman came around, the idea of walking around the city tuning out the sounds around you seemed self-defeating to me. If you are going to live and work in a major city among other things you know that it’s going to be somewhat noisy and somewhat dirty. Over the many years I’ve changed the way I feel and look at headphones in general, as they became so … normal to see people wear.

Let me note that I believe Wireless headphones are a great idea. Particularly where exercise is concerned. What’s different about the earpod ‘revolution’ is that now more than ever, when someone walks by you wearing them you don’t know if they are talking to someone else, listening to music or a podcast, or wearing them just in case someone calls. In the process what seems to happen is that everyone is ignoring everyone else – more so than usual. Because people kind of look like they are paying attention when they are wearing earbuds, in fact the legions wearing them are appearing to be engaged when in their head they are miles and miles away. In a big city it can be quite impersonal sometimes and earpods are making it worse.

At the same time I LOVE listening to music while I walk around the streets of New York. The Weepo earbuds are small and have no dangle so it looks a little like a hearing aid in both ears. (That’s how you know it’s NOT a hearing aid and please pardon me if I am being a little over-sensitive in my advancing age). The carrying case is more of a hassle to tote around than the old wired earbuds, which easily fit in every pocket. The need for regular charging is also a bit of a pain and requires forethought so I don’t run out of juice. I assume I will adapt my behavior accordingly.

I am not sure why, but when I am not listening to music or something else, or talking on the phone I can’t help feeling a bit pretentious in wearing earbuds. There’s still a certain cachet in wearing them which will die out fairly soon in my opinion. But for now it’s hip and cool to have earbuds in all of the time.

I understand the overall usefulness of earpods. The ability to tune out the honking, rumble, and bustle of the city with your selected groove is fantastic at times. I just feel guilty tuning out from my fellow commuters, pedestrians, taxi, Uber and Lyft drivers. I am part of the vibe of the city and with that comes the responsibility to be part of the community in any number of ways.

With the increasing ability to disengage in the presence of others, (for what it is worth Instagram is truly a black hole in which I see people on constantly), the intention to further disengage seems to me to be a negative trend. My guess is that I will overweight the positives of using wireless earbuds and continue to wear them, just not all the time.

 

 

 

 

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Regional accents and behaviors are declining in the U.S

I recently returned from an annual trip to Myrtle Beach, South Carolina to play golf with what are now friends for more than 20 years. Obviously the South is very different from the Northeast. To add to that I am also a city person and Myrtle Beach might be considered a city but to me it’s really a beach town.

There are many things I like about Myrtle Beach. Not the least of which is the South Carolina accent. I like that I am referred to as ‘darlin’ and ‘honey’ as that is indicative of the warmth and spirit that is evident in so many places there. Over the years however, I’ve noticed there are more and more non-native Americans (not to mention southerners), that haven’t adopted the Southern drawl. And that southern drawl isn’t as prevalent as I recall. That’s not really surprising when I think about it since even in New York accents in general aren’t as strong as they were years ago.

Television, radio and video have done much to homogenize regional accents. We hear news and commentary delivered by talking heads that have worked to flatten whatever accent they might have had growing up. In the New York City area a Brooklyn accent used to be discernable from one from Staten Island or Long Island. Today it is more difficult to tell the difference. A New York accent still exists but in general it is not as pronounced. It’s not as if accents are disappearing entirely, but I am concerned that at some point in the future it will be harder to tell where someone comes from by their regional accent. I don’t feel this is a good thing but nothing can be done about the march to homogeneity when it comes to accents.

When I go to Myrtle Beach I enjoy eating grits. Grits are rarely served in restaurants in the northeast (or the Midwest or the West coast), and I look forward to being able to get them at every breakfast. Speaking of breakfast, Myrtle Beach is replete with pancake houses, lots and lots of Pancake Houses. There are more than 20 on the Grand Strand alone.

All seem to open at 6AM and close at 2PM. Most appear to have many customers throughout the period to serve vacationers and locals alike. I am impressed that these large buildings can afford to only be open 8 hours per day (7 days a week) and wonder how long this pancake house thing will last? In general people even in the U.S. are trying to eat fewer carbs and healthier overall. Grits, biscuits and gravy, bacon, and eggs with hollandaise are opposed to that end. Sure you might like to spoil yourself every now and again but good old-fashioned diners have been in decline in the U.S. for years which I wrote about, and I fear the same will be eventually true of pancake houses in Myrtle Beach.

To me regional attitudes and behaviors are big reasons to visit different areas of the county in the first place. It’s interesting and diverse. While we are far from the U.S. having zero regional differences (perish that thought!), where things were more isolated before mass media, the trend is away from strong regional accents and behaviors. I feel this is not a great thing but there’s little to be done to forestall the trend.

It’s too hackneyed to think of the world still being filled with ‘Southern Belles’ and ‘City Slickers’. Both are still in evidence but you’d be wrong to think just because someone lives in a southern town or a northeast city they will behave in a particular way most of the time such as ‘Southern Belles’ wearing petticoats and serving sweet tea or New Yorkers saying ‘fuggedaboutit’.

Importantly, as marketers we have to fight these kinds of biases or else we will miss opportunities and successes. Challenging your own biases helps you to get closer to the truth of what really is happening.

 

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