What’s Wrong with Marketing Firms
I have a love/hate relationship with marketing firms. I often love the people who work at marketing firms. I love the cool offices at marketing firms (though I don't like paying for them). And I even sometimes love their ideas. But there are lots of things I hate. Several blog posts worth, I suspect.
The thing I hate most is being asked "What is your budget for this project?" Or, worse yet, "What is your marketing budget overall?"
I always answer the same way: "My budget is unlimited. If you can generate (and measure) positive ROI on this project and any future projects there is literally no limit to what I will spend. As long as your ideas keep making me money, the budget just keeps growing."
I have never been asked: "What is your ROI goal for this marketing project, and how will you measure the ROI?"
To me, this is the difference between being asked "How much of your money can we spend?" and being asked "How can we be sure the money you spend with us will produce an acceptable ROI?" The first question is about how much money the marketing firm will make. Now, here is something that might a be surprise to some marketers: The second question is as well, since that positive ROI is going to be the source of the cash to pay for your future work.
Talking ‘Bout my Certification
The controversy over the Smart Choices program has me thinking about consumers' growing interest knowing more about their food and the people involved in producing and selling it. This has created an exploding number of rating systems and certifications from the grand-daddy of them all, kosher certification, through labor certifications, organic certifications, fair trade certifications, environmental certifications, animal welfare certifications, and so on. This all on top of the variety of local, state, and federal regulatory schemes with which businesses are supposed to comply.
Today I learned about two interesting programs which attempt to go beyond the welter of fairly narrow "single issue," if you will, certifications to attempt more comprehensive looks at corporate behavior. The Good Guide works from the level of individual consumer products, but beyond narrow issues of health and nutrition it purports to evaluate manufacturers on a wide variety of social and environmental factors. The B Corporation works from the corporate level, and has what I would call a governance focus.
This is a fascinating area of development, and it will be interesting to see if any of these efforts gains sufficient traction to be a meaningful force for change -- approaching the mind share of the "Good Housekeeping Seal." (I wonder if that is meaningful anymore? I remember hearing it as a child, but not recently.)
My own guess is that none of these efforts will penetrate the fog of constant consumer marketing and provide enough consumer market muscle to be worth much, thoough I think a few of the "single-issue" certifications will gain traction with consumers passionate about those issues. The rest, especially the broader ones, will fade out, with the possible exception of the "local" movement. More on that later...
More on “Free” Shipping
This morning I was greeted by emails from a few Koeze Direct customers asking about whether we were going to repeat some of our prior free shipping offers. A couple explicitly said, "Give me the free shipping, or I'll buy from someone else." I emailed back to say how sorry I was to lose them.
Like all direct marketers, Koeze Direct loses a certain number of customers every year. These customers need to be replaced with new ones, and that often requires making some sort of special offer to inspire prospective customers to give our products a try. We lose money on the first order, but we hope to land a loyal customer and make a profit in the future.
For several years now, a "free shipping" offer has been the #1 motivator for new orders in the direct marketing business, and we have tested these offers extensively. But such offers can only be successful if we retain those customers and they are willing to pay shipping going forward -- either in the form of shipping charges or in the form of higher prices for our products. (For more on this, see this post.)
What we are beginning to see is that free shipping has become an expectation from some customers. If this expectation becomes the norm, it will pose a huge challenge to the mail order business.