The Direct-to-Retail model is fading away

If you know anything about direct response marketing, you know that it’s been around for awhile, is currently the rage, and looks and behaves little like it did just ten years ago. In 2008 direct mail had already taken several hard hits and was in decline. Direct response space advertising had begun to wane but the frequency and effectiveness remained strong. People were still watching cable and satellite TV and Netflix was still shipping out DVD’s and Hulu was only just born.

A great deal has changed since 2008 including changes in the ways people consume information, buy products, and view media in general. Add to this the continued rise of Amazon as a buying platform and you can see how direct marketing has itself been disrupted. Recently two longstanding direct response industry associations have been either absorbed or disbanded, i.e. the DMA – Data and Marketing Association better known as the Direct Marketing Association was absorbed by the ANA (Association of National Advertisers), and the ERA – Electronic Retailing Association no longer exist. This did not seem possible ten years ago.

For many years when launching a product via direct response television, radio, direct mail, or space, it was common to consider the product a ‘success’ when it went to mass retail. There still might have been direct response advertising even after the product had gone to retail, but it was as much a drive to retail as a drive to a direct sale. And buying ads at direct response rates is always less expensive.

Twenty years ago fulfillment of direct response product orders took weeks not days. Managing data was far from easy, and remarketing to direct response buyers was by mail and phone. Think about that. Going to retail was SO much better.

Today, launching a product via direct sale is very en vogue. Companies like Dollar Shave, Harry’s Razors, Warby Parker and Bonobos are examples of direct response launched companies that have some brick and mortar retail outlets. Here’s a list of 19 from Business Insiderhttp://www.businessinsider.com/online-direct-to-consumer-brands-with-retail-stores-locations-2018-2 . But the bulk of the sales for those companies all remain direct response. And that’s the way they want it since those direct sales are substantially more valuable than selling through a third party brick and mortar or online retailer like Amazon.

It’s also understandable that for most companies where there’s already a third party retail model (think Wal-Mart, Costco, Target, etc.) in place, a discussion on how to get more direct sales is ongoing. The direct response buyer is clearly more valuable to the bottom line than the retail consumer. Of course that’s only true if companies can keep those consumers coming back!

The convenience of online ordering and shipping has been the tipping point. Pricing differences to the consumer at retail versus direct response are becoming minimal. This allows the consumer confidence in not worrying about price in one channel versus another. Another huge advantage of driving the retail customer to buy direct is the ability to re-market to these customers via email, SMS, or other direct messaging platforms. Finding the right messaging cadence and frequency isn’t easy but it’s worth the effort.

Retail brick and mortar stores will not disappear from the landscape. But it’s clear that the amount of retail outlets will diminish for most brands. Brands having retail showrooms will continue to be the next wave. Going direct-to-consumer is the future if not the present.

 

 

Posted in Direct marketing, Direct response, Direct Response Television, Direct sales, Disruption, E-commerce | Tagged , , , , , , , | Leave a comment

Has Facebook become tedious?

There are those that will say Facebook already was tedious.  A couple of weeks ago while guest lecturing a Fordham grad school class, I asked the students if they used Facebook more or less than five years ago and almost all heads nodded in agreement that it was definitely less. I did not explore this further with the class but based on what I hear in my own life’s network most are not nearly as active on FB as they once were.

I can think of a number of reasons how this came to be. Before I lay out a few, I want to be sure that as least as far as I am concerned, there are several really good things about Facebook. What is best about the platform is that it connects people and families inter-generationally.   My late mother-in-law did not ‘join’ FB until 2015 and she had a little help getting started from her daughter.   I don’t recall my mother-in-law ever responding to anything yet I knew she loved to look at all the photos of her children, grandchildren and great grandchildren. No other social media platform comes close to doing what FB does that way. If you have any doubts that FB is here to stay, you should reconsider when you think about what could take its place in terms of connecting families.

Then there are regular old FB ‘friends’ outside of your family members. If your FB friend roster is anything like mine it’s a rather eclectic group and most of my FB friends simply don’t post. For a platform that’s been around for nearly fifteen years (but I’ve only been aboard for about 11), the way the online world was in 2004 is very different from today. Competition for screen time has been cranked up. An article in the Motley Fool earlier this year noted that time spent on FB by the average user is approximately 27 minutes per day for “daily users” and 41 minutes per day for “monthly users”. Do you come close to that?

Also from the Motley Fool article:

‘To put Facebook’s engagement levels in perspective, it might help to compare it to Snapchat. Snap (NYSE:SNAP) boasts about how engaged its users are, with those under 25 spending over 40 minutes per day. Recently leaked data revealed that the average user spends about 35 minutes per day. Facebook tops that number by nearly 20% — and on a much larger scale.

Snapchat had just 178 million daily active users in the third quarter. Facebook had about 1.35 billion for the same period, and growing at a similar pace.

Average time spent on Facebook is comparable to Instagram, which posted last summer that its users under 25 spend 32 minutes per day in the app. Those over 25 spend just 24 minutes per day. (Instagram didn’t specify whether it was counting daily users or monthly users, but it’s likely the latter, per Facebook’s standard.)

Five reasons FB has become tedious – you may have more.

  1. Posts from what appears to be a limited amount of FB friends that appear more often than others, and who post about the same things all the time. Boring.
  2. As mentioned, competition for screen time is keen. I know many who prefer Facebook-owned Instagram for social media posting to Facebook. And if you are under 30 FB is even less important.
  3. Modeled content based on what I click is now boring. It wasn’t at first but now it is. Please stop with the suggested articles on why my beloved NY Mets stink again this year. Yes I know I can turn it off. But I never turned it on.
  4. There has been some discussion that a non-advertising supported (i.e. paid subscription) model has been considered. COO Sheryl Sandberg alluded to this whether she meant to or not. A Washington Post article claimed the yearly cost would be $18.75. Well within reach for most people.
  5. Suggestions on wishing Happy Birthday to my Facebook friends. That’s really boring. As is FB geo-targeting that one of my FB friends is ‘nearby’. This approach did not work for Foursquare. And pardon me if I think that FB asking me to wish Happy Birthday to deceased friends https://wp.me/pn6jX-US is worse than boring.

Things I feel are still good about Facebook

  • There are lots of pictures and stories about my family. Lots and lots of pictures.
  • Invitations to events work well on FB and have not gone crazy. As yet.
  • Messaging to some close friends gets to them faster on FB than via email or even SMS.

Like any social media platform (or any business for that matter) Facebook will need to evolve in order to stay relevant. The great quote attributed to Mark Zuckerberg played by Jesse Eisenberg in the movie ‘The Social Network’ – “That’s the beauty of it – it’s never finished”, is true. Longtime FB users will never go back and use the platform the way they did at the beginning. Adding new users suits FB’s goal of bringing the world a little closer together. But for now Facebook is just more and more….boring.

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Disrupt Thyself!

Earlier this year I posted about a trip I took driving across the U.S. from east coast to west coast (and back again). It was far from being routine and is all part of my personal continuing effort to disrupt my routine and comfort zone. I find that the older one gets the more comfort and routine become important.

Disrupting myself is something I do to stay fresh and ready to tackle whatever might come my way. It’s more than taking the long way home. But even that’s better than sleepwalking through the routine day after day. New experiences help build new neural pathways in your brain.   Finding ways to have confidence that you can work your way through unfamiliar situations is actually very calming and empowering.

Not every effort to disrupt myself works for me and by that I mean I sometimes put myself into an unfamiliar situation (attending a meeting about something of interest, meeting new people) only to find out that the event was not what I thought it would be and for the most part I wasted my time.

This happened to me when I was in a large city in southern China on business some years ago. I attended a conference and was scheduled to speak but the slot was pulled at the last second (don’t ask). While I speak a little Mandarin – enough to get around alone in China, I spent two mostly miserable days inside the conference venue not meeting many people. So it was a dud. But not a total dud since I did have to manage my way around a foreign country where I have difficulty in communicating and reading signs although many of them had some English posted as well. I remember having to take a train back to Hong Kong and hoping that I was buying the right ticket for the right train. Nobody spoke English. I was bemused and even a little nervous. And I also felt incredibly alive. It ended up being much less difficult that I had imagined. This happens a lot to me when I take on something unfamiliar where the outcome is questionable. Most of the time I think ‘that was much easier than I thought’.

Here are 5 ways you can disrupt yourself:

  1. Attend a lecture or event in person on a subject that interests you but isn’t related to your work.
  2. Choose a place to visit that you’ve never been to before and travel there and back by train or bus if you don’t normally do that.
  3. Avoid social media entirely for a week. Discover how much time you get back.
  4. Set up lunch meetings with friends and colleagues. I am a big believer in going out to lunch to reset.
  5. Visit your clients quarterly even if you are not invited. They’ll like it more than you might think. Being there makes all the difference.

Disrupt thyself. Do the unexpected or out-of-the-ordinary. Show up even when you weren’t invited. Throw yourself off-balance and then figure out how to get back in balance. Guess what? You’re living more, learning more, and if you ask me – living better.

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LinkedIn prospecting is becoming much worse than junk mail

A little over a year ago I wrote a post entitled ‘Who are you? And no I’m not going to accept your LinkedIn invitation‘.  The general idea being that random people ask to ‘join my network’ without my knowing anything about them aside from their own LinkedIn profile. My network is precious to me as is my reputation. The last thing I wanted was a bunch of people I don’t know contacting people in my network suggesting that since they knew me they should be trusted. Ugh!

I received some blowback from the post that I was being ‘too negative’. That kind of stung a bit because in general I am a very open and engaging person who loves meeting and talking with new people. Yet it seemed to me that the people that were (and still are) contacting me are reaching for low-hanging fruit – people who just want to build their networks and scour your contacts for possible business opportunities.

Then like now, I almost never receive a LinkedIn invitation that notes that in addition to looking at my profile, the inviter looked at our company’s website and has some basic understanding of what we do and how we like to represent ourselves. More recently I have received 10-20 invitations per WEEK from LinkedIn members that are offering me lots and lots of business leads. Which strikes me oddly since there’s no way they can identify the kinds of companies that our agency is best suited to work with. Again, low hanging fruit, fruit in my case that shall go unpicked.

Some of the inquirers are quite persistent – three emails in a week asking if I read their earlier emails and whom they might talk to if I am not the right person in my firm. Often they will ask if I can let them know if I am not interested so that they can take me off their list. I’ve not fallen for that one. LinkedIn is becoming like my 1995 postal mailbox with many ‘opportunities’ (i.e. junk mail) for me to review. In fact if I were to answer all of them I’d be spending time I’d rather not spend each week replying – no thank you I’m not interested. And while that will stop most of the inquiries it won’t stop them all from trying me again in the future to see if anything has changed.

I spent a good part of my earlier career ‘cold-calling’ but haven’t done that in years. It’s very difficult and almost entirely not fun at all. The only time it is fun is when you get a live one. I wrote about stockbroker cold calls as well not long ago.

You might think I don’t like LinkedIn much but you’d be wrong. I really like it and am a Premium member (this means I pay for it) and I use it all the time. LinkedIn in many ways has turned into an online job market. However, since I am not in the job market I am of no use to LinkedIn’s revenue stream there. What I am is a target for others to try to engage. I am ok with a well-conceived pitch and approach and absolutely will respond to good and appropriate pitches. But the flood of irrelevant pitches is increasing at an alarming rate and LinkedIn had better think about doing something about this before others become as aggravated with these unsolicited sales pitches as have I.

I think LinkedIn can do better. So can the LinkedIn member pitches. Don’t you?

 

 

 

 

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YouTube was a $1B bargain for Google

Each year Mary Meeker of Kleiner-Perkins has given her viewpoints under the umbrella of ‘Internet Trends’. This year’s report in my estimation would take most people 15 minutes or less to scroll through the deck. I believe it’s worth your time. I came away feeling that YouTube should be considered the go-to platform for most Americans. I had not thought of it that way prior. It’s worth remembering that when Google purchased YouTube in November of 2006 for $1B people were scratching their heads as to why. That’s hardly the case today as YouTube is the foundational video-watching platform (it’s not really an app).

Rani Molla of Recode did a nice summary of Ms. Meeker’s 294 (short and snappy) slides.

The full transcript of Ms. Meeker’s remarks can be found here and they are worth reading.

There were many interesting data points in the presentation – a few of my own highlights:

  • Slide 19 indicates tremendous popularity of mobile payment in China The U.S. lags far behind in mobile payment adoption.
  • Slide 62 notes that 49% of product searches begin on Amazon.
  • Slides 76 and 77 note the focus on CLTV – customer lifetime value. That brought a smile to this direct marketer.
  • Slide 85 – I personally was surprised that people view products on YouTube so frequently before buying them – likely on Amazon.
  • Slide 192 how ‘query growth’ for Google Searches ‘Near Me’ are increasing much more than anything else. Location in mobile search is indeed everything.

If you are interested a few other resources you might want to check out

This report from Brandwatch offers some very interesting statistics on YouTube.

Finally the Pew Internet report from March of 2018 also is worth your time.

The statistics here on YouTube are quite compelling.  Because YouTube is a platform and not an app it sometimes is not considered a direct competitor to FB, Twitter, Snapchat, Instagram etc. But when it comes to time that people spend watching, interacting etc, YouTube is impressive.

Keep in mind that while many companies block employee access to social media sites, they don’t normally block YouTube.

Think about the ‘screen time’ you spend and how much of it ends up on YouTube. Do you find it to be increasing year to year?

Posted in Google, Internet news | Tagged , , , , , , | 1 Comment

Man Bites Dove –A dessert so good it needs no advertising

I am thinking about ice cream and not only because we’re past Memorial Day here in the U.S, which is the unofficial beginning of summer… I just really love ice cream, but I also know that ice cream is a treat and best consumed in moderation.

SAID NOBODY EVER!

So with that in mind I wanted to let you in on a secret vice of mine. “Dove Bar Minis” – dark chocolate coated mini ice cream bites with either chocolate or vanilla ice cream inside. They also make milk chocolate-coated ones, since I know you are wondering, but IMHO they are not nearly as wonderful. At 60 calories each you can eat two or three (my max at one time has been five) and still feel as if you have satisfied a totally guilty pleasure.   They are in an overused word these days – AMAZING!

It’s interesting when you find something that is not advertised or found in restaurants. We have always called them Dove Bites, so perhaps at one time that is what the packaging said, but now they are named Dove Minis. These treats can be found in many supermarkets although from my experience they do seem to run out more often than one might expect. I notice boxes in other people’s carts and smile knowingly. One time at a friend’s house in Florida we had finished dinner and he asked if I wanted something sweet. And out came the Dove Bites. All I could think about was to wonder how he found out and guessed that he found out the way I did – by looking in the frozen ice cream novelty case many years ago.

There are 14 Bites in a box and they cost around $4.50 per box. So at $.30 each they are reasonably priced, satisfying yet not a calorie bomb and did I say they were amazing? You can’t easily buy Dove Bites on Amazon or Wal-mart/Jet.com – a recent check on both said they are ‘unavailable’.

Why isn’t M&M Mars promoting Dove Bites more? Surely it’s not because they can’t make them fast enough? And even if they raised the price a little, aficionados like me would still buy them.

One last thing, when I visit Costco (another favorite of mine), I always look to see if there might be a giant box of Bites so I could not run out and pay less per unit. Sadly, I never find them (hint hint Costco & M&M Mars!) If there were 60 in a box I’d buy them and in our house they might not last much more than a month.

Try them for yourself but don’t tell too many of your friends. I hate it when the store runs out.

 

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Sometimes an airline gets it right – A Southwest story


The ad above is from 1992.  For me it’s appropriate right now.  Given the recent tragedy aboard a Southwest Airlines jet my timing might have been better but since my experience happened last week it is more relevant now that it will be in the future.

If you travel enough your destiny is to have both good and bad experiences. Prior to boarding any flight hope springs eternal for an on-time, low-stress, pleasant (and as I like to say boring) experience.

Last Thursday evening I had one of the bad ones – four-hours on the tarmac due to bad weather up and down the East Coast. Having never flown on Southwest Airlines (how was this possible?) I had my first experience with lining up for boarding, tight seating, and free-Wi-fi (although I am not sure why since the Southwest website notes it is $8 on domestic flights – maybe the flight crew knew something about the trip beforehand).

It was mind-numbing to be 2nd in line for take-off only to roll back to a remote runway when Air Traffic Control (LaGuardia) placed a total stop on flights in and out of the airport. Airline personnel and passengers had no idea if or when the flight would leave. Finally the plane returned to an open gate. It took about an hour before hungry passengers walked off the plane to try to find something to eat (it was 10:30PM).

The flight crew was patient as were the passengers. Even understanding the situation, I was having a terrible overall experience through no fault of the airline. At least that’s what I kept telling myself although I really wanted to blame someone or something other than the weather.

Finally the flight departed almost four hours late and of course when we arrived in the NYC area we circled for half an hour more before finally landing. There were so many flights in the same boat that LaGuardia was midday busy at 1:30 in the morning.

I was tired and cranky and certainly while not blaming Southwest, not in any hurry to choose that airline again unless it was the best time and price option. I’ve tried cutting airlines off in the past but always end up going back since always seems to end up costing me more someplace else.

The following day I received two emails from Southwest. The initial one apologizing for my first and as it turns out, poor weather-related travel experience (Southwest seemed to know I had not flown it prior), and that a LUV coupon for a future flight discount was to be issued in a separate email – which it was only a few hours later.

I was impressed and tweeted that Southwest did NOT have to do that and their response was swift and appropriate. Period. End of story. But, I am glad Southwest did make the extra effort and what’s probably most significant is that it changed my viewpoint of the airline and how I might evaluate a future flight option to now include Southwest.

For fans of good social media practices and customer service, this is how you do it right folks.

Posted in Airlines, Customer Experiences | Tagged , , , | Leave a comment