Strategy

Direct Marketing: Who Does It Well?


I was recently asked who I think are some of the best direct response marketers today.  This is what I said:

I have chosen four brands that showcase different aspects of excellence in DR marketing: American Express, JetBlue, Target and Starbucks.

Screen Shot 2014-04-30 at 2.17.29 PMAmerican Express:

American Express is a good example of a marketer that uses modeling, and mail/offer testing effectively. It also uses a wide range of channels, from mobile/geolocation to direct mail, email, social and telemarketing, and has even experimented with addressable television.

American Express uses its reserve of transactional and other data to target and space offers and to reach customers through their individually preferred channels. I personally receive and respond to offers via my mobile device through the geolocation application foursquare. These offers are timely, relevant and easy to redeem. Once I have “unlocked” a special offer, American Express applies the discount directly to my statement. This program originated as a way to drive activity for AMEX’s small business customers; however, it is equally valuable for card members. The direct application of the rebate to a card holder’s statement resulted from research that showed that members often feel uncomfortable or inconvenienced by having to show a coupon at a restaurant or other place of business.

American Express offers are tied to segmentation such as the type of card or specific activity. For example, Gold card members receive a Platinum offer every 3-4 months, a customer who shops at Petsmart might receive a $10 offer for a future purchase there, and someone who travels might receive offers related to places he or she has visited or for a traditional AMEX product set such as Sign and Travel.

My understanding is that American Express dedicates 15% of its budget to testing. This reflects the brand’s commitment to continuous learning, using controls and checks, trying new things, tweaking, and defining and tracking measures of success.

Screen Shot 2014-04-30 at 2.09.49 PMJetBlue:

JetBlue uses DR marketing more for relationship building than acquisition. They manage the relationship with their patrons in a structured and fun way that clearly reflects the brand’s personality.

JetBlue is a good example of brand that demonstrates its relevance to the customer, expresses itself in its own voice, and delivers timely and appropriate messages. In addition, the brand and the message stand out and add value to the relationship for both parties.

The JetBlue birthday email depicted here is simple, unexpected, quick and to the point. It recognizes the fact that people are likely to fly around the time of their birthday and offers a potential bonus for flying with JetBlue.

Screen Shot 2014-04-30 at 2.23.04 PMJetBlue uses social channels such as twitter for both promotion and customer service. In this twitter exchange, you can see the airline’s promotional offer: “Spread yur wings & try an exciting new destination w/ flgts from $59.” The message is short and enticing with an effective call to action and means to take action by clicking on the link. Note that the reach of this offer has been amplified by being retweeted. In addition, this exchange demonstrates how JetBlue’s social customer care presence is consistent with its brand personality. The response from the JetBlue representative to M Schackne is energetic, playful, timely and personal – showing a consistency across channels.

19cover2-sfSpan-v3Target:

Target used sophisticated statistical modeling to identify mothers-to-be by mapping buying behaviors of loyalty card members to those who had signed up for baby registries – thus giving Target access to a highly profitable customer segment.

Because birth records are usually public, new parents are immediately inundated by all kinds of offers and advertisements, so the Holy Grail is to reach these parents before their child is born. Target was able to pinpoint customers who were pregnant and even estimate their due date. This allowed them to send extremely targeted offers to drive in-store traffic. Some say that this strategy of reaching new families and making them loyal Target customers was key to Target’s revenue growth of $44 billion in 2002 to $67 billion in 2010.

Target’s strategy became public due to a New York Times article that featured a story in which Target knew that a teenager was pregnant before she had told her family. This story highlights the fine line between relevant and “creepy” that direct marketers must navigate in this age of big data and personalization. DR marketing is permission based, and we must be careful not to impose upon customers’ good will and sense of comfort.

Screen Shot 2014-04-30 at 2.20.41 PMStarbucks

Starbucks uses digital, particularly mobile, channels to integrate itself into the day-to-day lives of its customers, from “home to store to home.”

Through its mobile application, Starbucks sends offers that range from value added items such as free music and applications to specific offers to try new products for free or at a discount.

Starbucks also uses this channel to provide loyalty rewards, which include free products. Other offers encourage and enable customers to serve as advocates by, for example, tweeting promotional offers to friends.

 


The Marketing Funnel – Should You or Shouldn’t You?


I was recently asked whether I organize my marketing thinking along a demand or marketing funnel.  This question brought to mind a set of two blog posts (“Advertising Week 2011 Key Themes” and “And, uh the a ha is“) from October 2011 covering Advertising Week.  I have included the relevant sections below.  While I am still refining my answer to this question, this is my initial response:

  1. On many occasions, I do organize my thinking along a demand or marketing funnel. It depends upon the specific marketing initiative or challenge.  I find the marketing funnel useful when addressing macro issues such as the role of “upper funnel” awareness communication vs. “lower funnel” direct response activities – and how these should be coordinated or integrated.  It is also a valuable framework for ensuring that a brand reaches its target customers at each stage of the path to purchase with the right message at the right time and using the right medium or platform.
  2. The metaphor of a funnel in which the number of prospects or size of the consideration set becomes more focused in each phase is less relevant in today’s non-linear, iterative digital and social environment. Today’s framework is more of a decision journey loop with a consideration set that may contract and/or expand along the way and in which post-purchase communication and activities such as social sharing and an ongoing dialog are crucial.
  3. I often use a customer journey map or customer-specific path to purchase that incorporates the way in which consumers move from one platform to another as they interact with a brand. This approach frequently includes the development of customer personas and/or the identification of moments of truth.  It has its origins in the marketing funnel and is an expansion of it.

And, Uh, the A Ha Is: 

The ruling on the purchase funnel is not final.  Most agree publicly that the traditional funnel, e.g., awareness, consideration, intent, purchase, loyalty – or as I was taught in business school, AIDA: Awareness, Interest, Desire, Acquisition, needs to be updated.  The patch to purchase is no longer a straight line.  The funnel of choice seems to be the McKinsey oval, which you can view in my summary of the panel.   (No mention of the Forrester “path to purchase” in the age of social engagement – see below).

The key takeaways are that:

(a) the process is iterative and circular

(b) must include advocacy

(c) many include “loyalty,” but that’s not new, that’s just “adoption.”

However, when we got to the TV panels, the upward and lower funnel nomenclature was still front & center.  A disconnect?

Figure I: Forrester Path to Purchase in the Age of Social Engagement

Customer Journey in the age of social media – Forrester

Figure II: Harvard Business Review – Traditional Funnel and McKinsey Consumer Decision Journey

Advertising Week 2011 Key Themes:

The Funnel (aka Path to Purchase and Consumer Decision Journey) – The traditional funnel is outdated.  However, much of the terminology has survived and/or been incorporated to the new, bright shiny (Mustard colored) circular tubes.   There is some consensus about the fact that the process is no longer linear but more of a circular conversation. – However, the term “funnel” as well as “top” and “bottom” of funnel and stages such as awareness, consideration, acquisition were used frequently, particularly by CMOs.  However… the funnel must include advocacy.  (Social, social, social)  And, the funnel is iterative and, well, free flow.

Pinterest Comes Home


When I first joined pinterest, it was, as its name suggests, a virtual pin board where I would explore and share my interests and passions visually.  The first passion I brought to life was tennis, starting, of course, with Rafael Nadal.  My “Tennis” board was a form of visual poetry as I sought to assign just one word to each compelling or inspirational photo.

I then moved on to the creation of a “Recent Indulgences” board where I could document and share recent purchases.  This was something I had been doing on Facebook for many years by way of a photo album by that name, so the jump to pinterest was quite natural.  And the fact that I could simultaneously share these images with Facebook and Twitter made this an easy transition and enhancement.

Home Furnishings

More recently, I found myself in the position of shopping for a new desk.  As I surfed the Internet and came across items that seemed to fit my need and that I found visually appealing, I found that uploading these images to pinterest was a wonderful way to keep track of the items I discovered.  In fact, by creating a “Desk” pinboard, I was able to see the commonalities across the pieces of furniture I pinned and get a better sense of what I was looking for.  It also prompted me to expand my search by exploring a new direction.  This time around, I did not need to use the handy “pin it” button I had installed a few years back as I discovered that virtually every eRetailer had a pinterest widget incorporated into their website.  Clearly pinterest has become a table stakes component of online retailing.

Pottery Barn Pin It Button

Now that I had this nice compilation of desks, I was able to share my ideas with friends and get their input.  In fact, one friend commented that what I really seemed to need was a new desk chair for the table I had been using rather than a new desk, and so my pin board became about “Desks and Chairs.”

Another element that was really wonderful was that when I pinned an item that someone else had also uploaded to pinterest, I was given an option to click through to that person’s pin board, which invariably provided new inspiration and led me to new websites and retailers featured in the pin board I visited.

Pinterest ExampleI’ve now expanded my board from desks to “Home Furnishings” as I explore dresser options as well.  So pinterest has continued to be a form of visual exploration and expression.  But it has now become a crucial part of my online shopping experience.

I recently overheard someone say that pinterest is not about what people have but about what they wish they had – as if this were some kind of dark secret.  I recalled that when Myspace first came into being it gave teenagers an opportunity to portray themselves however they wanted without being limited by the size, look or location of their actual home.  In this case, the aspirational nature of pinterest is open, exciting and powerful – just like the pin boards of our youth.

Timehop Abe – It’s Nice To Wake Up with You


If you have not already invited Timehop Abe into your life, I highly recommend it.  Timehop Abe sends me an email each morning recapping my social activity from one year before.  Personally, I find this to be extraordinarily interesting.  It puts things in perspective to be reminded what I was thinking about and experiencing a year before.  Do I feel the same way today?  Are my observations still relevant?  Was I doing something particularly fun or interesting?  How has my life progressed?  Am I about to attend the US Open exactly one year from the last time I did so?

This morning I woke up to a quite lengthy recap of my Twitter posts from OMMA Global, which took place September 26th, 2012 – an interesting reminder on the eve of Advertising Week 2012, which includes OMMA Global.  I imagine OMMA schedules during that week in order to take advantage of the energy and the presence of those from out of town.  Unfortunately, for me, I prefer to sample the smorgasbord of Ad Week panels throughout the city vs. dedicating a day to OMMA Global, which is a shame.

In any case, as I reviewed my entries, I had two observations: (1) Most, if not all, are completely relevant today.  (2) Some are more relevant today because the topics or initiatives were just being born a year ago and have become mainstream, such as AMEX’s foursquare program, which has now branched out into other social media such as Twitter. (I see that I quoted Zuckerberg several times.  Was he there?Have I seen the great Founder in person? I don’t recall – though I could certainly look this up…)

Hence, since the majority of my observations are still of interest, I thought I would start my day by sharing them with you.  What do you think?  Are they still relevant and thought provoking?  I have added some of my own comments.

#1 This was the beginning of an ongoing – friendly – battle for mayorship of my apartment building with my doorman, several years since I created the venue.  I don’t believe that anyone else in the building has ever signed in.

#3 “Native Monetization.”  I don’t recall hearing this phrase since the conference.  However, a quick Google search does reveal some discussion:

“Native advertising is a new form of inventory that seamlessly integrates promoted content from brand advertisers into the fabric of a site itself. Native advertising inventory is content that’s part of the site experience rather than ads that interrupt users, such as pre-roll video ads or boxes, buttons, and banners on the corners of pages. Facebook’s Sponsored Stories are one of the largest bets on native advertising in the ad industry – a bet that’s consistent with the ad strategies of the dominant social media platforms such as Twitter, YouTube, StumbleUpon and the coming ad products from the next wave of internet elite like Tumblr and Spotify” – Dan Greenberg, TechCrunch

I hope this does not include those incredibly annoying and interruptive “Pages You May Like” posts on my Facebook news feed.

Whoops – I have a conference call in 15 minutes.  More later…

Social Media Tidbits II


Visit me here – or on Pinterest – for social media tidbits I find share-worthy.  Share with me your thoughts and infographics you fancy.

Women dominate Facebook, Twitter, Pinterest and Zynga.  Men dominate Reddit, Google+ and LinkedIn.  Net, net, women are heavier users of social media.

So fantastic!  But… don’t blink, or this LUMAscape will be out of date.  Pinterest? (posted July 2012)

67% of consumers uncomfortable with Facebook’s use of data (July 2012)

Tweet, Tweet, Tweet – 100 million strong — 21 million active in U.S.

Social Media and Recruiting:

Using Facebook during the workday?  Sure!

Which Social Media Activity Do Companies Feel Benefit Them the Most?

I suspect this varies by company, e.g., a customer service/complaint/service oriented company such as Time Warner Cable, Comcast, Bank of America, etc., might rank customer support higher.  As Ted Schadler wrote in “Empowered,” customer service has become a form of marketing.  Think Zappos and Virgin America.


karenlevine:

“You Can’t Market Financial Services to Women:” I am currently exploring the issue of whether financial institutions are or should be marketing, communicating with and developing products and services for women – particularly in the digital and social arena. I found this article and the large number of comments worth sharing.

Originally posted on Snarketing 2.0 by Ron Shevlin:

Before you jump to conclusions — and all over my head — read first, and then let me have it if you’re so inclined.

There’s renewed talk these days in financial services circles about “marketing to women.”

Renewed, because I remember that 11 or 12 years ago, in the height of the dot-com boom, start-ups emerged dedicated to providing financial services to women (I still remember Jennifer Openshaw coming into our offices telling us about the Women’s Financial Network). I haven’t been involved in the financial services industry long enough to know if there was focus on marketing to women (specifically for financial services) before the dot-com era.

Recently, the topic has reappeared a number of times in the past few weeks:

View original 901 more words

The Stroke of Midnight – Will Viacom Go Dark?


As I looked up from my desk today, I saw a news story that caught my eye: DirecTV is threatening to take 26 Viacom channels off the air at midnight.  Gee, I thought, I guess it has been three years since they last were at loggerheads with the operators.  But that was December, and this is July.  That was Time Warner Cable, and this is DirecTV.   That was 2008, and this is 2012.  Is this story new or an off-network airing of a 2008 episode?

I went to the “Always On” archives to see.  What I found was my post from New Year’s Day of 2009.  I recall going out the night before preoccupied with whether Viacom would still be on the air when I came home.  It was a dramatic moment!  Fortunately, as with Y2K, the stroke of midnight did not bring the terrors foretold.

(Ok, so what I mean here is that in 1999, people feared that there would be all kinds of havoc when we entered the new century because our computer systems would get confused – long story – and people prepared for all kinds of hardships including food and water shortages and lack of electricity.)

In any case, my plan this evening – July 10th – was to republish the post below, comment on how this will be a tricky negotiation given that Viacom has had significant ratings problems with Nickelodeon and MTV, reference the fact that Viacom’s stock price is vulnerable to adverse news given these ratings problems, discuss whether these standoffs have become more common, more public, or simply more on my radar screen, and call it a night.

Given that I had an image of the Sponge Bob ad from 2008, I decided to grab one from this summer’s dispute.  That is where the differences became apparent.  The Viacom ads – at least the ones I found – are simple and slick and use Comedy Central rather than Nickelodeon brands.  Somewhat interesting.

But what really struck me was DirecTV’s website.  Clearly planned well in advance, the site maps out DirecTV’s side of the story including a heartfelt video message from the company’s CEO Mike White.  The ability for television programmers and operators to communicate more directly, personally and interactively with their audiences and customers makes 2012 quite different from 2008 – even though the key sound bites: “Viacom wants too much money,”  “DirecTV/Time Warner Cable is taking your channels away from you” may sound the same.

Who”s the Enemy?  Who’s the Friend? - January 1, 2009

Cable operators and TV affiliates complain when programmers put content online. Programmers put content online because that is where viewers are going. Music producers ignored this “where I want it, when I want it” trend, seeking to protect their business model, and were leapfrogged into impending demise by iTunes. NBC Universal cites Hulu as a huge success story, but CEO Jeff Zucker fears that the web will turn “analog dollars” into “digital pennies.” Online ads may garner high CPMs and may be growing at rapid rates, but they are still dwarfed by broadcast.

Viacom, owner of MTV Networks, has for years sought to create a “360 degree” media presence that hinges upon the Internet. They now have a huge army of digital employees. Cable operators complain that hits like “The Daily Show” and “The Colbert Report” are available in long form on Hulu. But who is benefiting now?

Viacom is asking for a 25 cent increase in monthly subscriber fees (25 cents more per subscriber per month) from Time Warner Cable across 18 Viacom networks. Yesterday, a crawler at the bottom of the screen for each of these networks warned of an impending blackout at midnight. (I rushed home at 1:20am to see the blank screens, but alas no MTV Armageddon.)

Now I watch Comedy Central more consistently than any other non-premium cable network (I love my Showtime – twisted as it may be), and my loyalty to the two programs above is on par with that for broadcast network programming such as “60 Minutes” – most other programming (“Eli Stone,” “Grey’s Anatomy,” “Ugly Betty”) comes and goes. I am proud and embarrassed to say that I get most of my news from Mr. Stewart and, to some extent, Mr. Colbert. So, what will I do if Viacom goes dark? I don’t envision doing much.

First, I don’t watch any of the other MTVN networks. I used to admire Viacom for its segmentation strategy, i.e., different networks for different age demos, but now what that means — for me as a single New Yorker, at least — is that I watch only one of their networks. And, as mentioned above, the two programs I count on are available on Hulu. In fact, Time Warner Cable is promoting to its subscribers where they can access Viacom programming online should it go dark on TWC. So, to whose advantage is the online platform now? Ironically, Viacom has made itself less indispensable to TWC – at least in the short term.

It reminds me a bit of our strategies in the middle east. We train the enemy of our enemy, even though that force was or could become our direct enemy. A bit of an extreme comparison, perhaps. But the question remains – to whom is the Internet a greater threat and for whom is it a greater advantage? Programmers? Distributors? Both? Neither?

Business minds around the world have not yet come up with a way to turn the enormous value of the Internet into a tangible, substantial monetary value. True, digital broadcasts of the Olympics, of SNL (Tina Fey) and of prime time programming do drive stronger TV viewing of these programs — something that was not necessarily anticipated. But, what is the long term business model? How can the television industry identify and transition to a new business paradigm? And, how will they accomplish this in light of existing carriage contracts and – even more specifically — Most Favored Nation (MFN) clauses that make change even more cumbersome?

You’ve Been Placed. And You’ve Been Spotted


Product placement has become to video what social media is to media.  It is intrinsic to its fabric.  It has become second nature.  It has become indiscernible.  And that is why I continue to enjoy observing and calling out the placements I spot.  Here is my third installment.  (Stay tuned for more.)

  • Colbert and Wheat Thins: Colbert coins the term “Sponsortunity” on an episode in which he reads at length from the branding memo for “Wheat Thins” that only someone in brand management could have written.  A real treat and must-see for those in marketing.
  • Diet Coke: Diet Coke seems to have used product placement in its own ad (“Not All Stars Appear On Screen”) during the Oscars.  The commercial shows the evolution of a film from script to production with cameo appearances by Diet Coke cans, e.g., in the hands of the writers and those producing the film and placed on the shelves of the door to the sound stage.

  • Apple: I find it so interesting to see which programs use Apple computers but cover up the otherwise highly visible Apple on the back of each device.  Example: Two and a Half Men.  Clearly, the producers like the aesthetic and how it fits with Ashton’s character, but, I guess they did not strike a deal with Apple, so they cover up the fruit.  Other shows go all the way – do they get paid for that?  In Showtime’s “House of Lies,” the consultants use Lenovo Think Pads.  I would expect no less (and it makes me cringe a little when I think back to my pre-Mac years).

For more examples, check out: Place the Spot, Spot the Placement and Spot the Placement, Place the Spot.

Playing with Pinterest, Tallying with Twitter


I finally spent an evening (ok late night) playing with Pinterest, and I can see why it’s so addictive. So many beautiful images. It’s visual decadence and indulgence.

It’s uplifting. A great way to spend half an hour… or more. It’s also extremely easy to use with an overall positive vibe (or tone, as Pinterest would say). People are sharing things they find uplifting or attractive or thought provoking, in a light hearted way. As of now, no disturbing images. And wonderful production quality. I wonder how they control for that. Images come from the Internet, so they’re not really user generated – though they are user curated. That maintains this highly polished experience.

But what’s especially nice – it’s all about the details – is the email you get when you sign up: “Hi karenlevine,” it says, “YOU are the newest member of Pinterest, a community to share collections of things you love. We’re excited to have you as a member and can’t wait to see what you pin.” Now that’s just nice.

Twitter, of course, is also addictive, but in a different way. On Twitter, I find myself almost unhealthily aware of how many followers I have. Am I loved??? Am I respected?  It’s like they days when you would come home and rush to see whether you had voicemails.

Every time I post something on Twitter, I watch to see if it leads to more followers – in that vast community of hundreds of millions of people I don’t know. Someone out there shares a topic I am interested in and felt that what I had to say merited following me.

Of course, I also look to see whether I have been retweeted, the ultimate compliment. Or retweeted my multiple people, a real head rush.  And then there are the responses. The exchanges you have with someone you don’t know at all. At social media week, it was truly fun to watch people who had somehow ended up following or corresponding with each other meet in person. And because the avatars are typically photos, it makes it that much easier.

Social Media, Reese Witherspoon and Pinterest


Last night on Chelsea Lately, Reese Witherspoon admitted that she “doesn’t get” social media.  Twitter, she said, “scares me.”  And, although she knew she had a Facebook page, she thought, upon Chelsea’s suggestion, that the address is likely www.reesewitherspoon.com.  (It isn’t.)

This adds credence to Terri Li’s estimation during a Social Media Week panel entitled “The New Ghostwriter” that 4/5 of celebrity twitter feeds are ghostwritten.  Terri is the Chief Operating Officer of Bre.ad.  It’s no surprise, of course, that Reese does not manage her own Facebook page.  However… the point of this comment, and the part that is (ironically) interesting is that Reese exclaimed in the next sentence that she LOVES pinterest.

On another Social Media Week panel, Jon Steinberg, the president of buzzfeed said of pinterest: “I think it’s going to be one of the most powerful business models after Google.”  Wow, that’s big.  What happened to the days when social media and other sites took years to figure out how to monetize themselves?  In fact, Google itself took 5 years before hitting the lottery.

Images below: reesewitherspoon.com (top) and Reese’s Facebook page (bottom)