Nowhere is this more appropriate than in the world of marketing that we exist in. Our world is full of myths, myths based on activities that worked for one company, but cannot work for all companies.
Myth: E-Mail marketing has the best ROI (return on investment).
- This statement, of course, borders on being ridiculous. Even if you manage e-mail better than anybody in our industry, you might pull down $0.25 per recipient, generating $0.10 profit. Your old-school catalog will generate $3.00 per recipient, generating $0.60 profit. If you could only mail one piece, would you choose the e-mail campaign, or would you choose the catalog? The e-mail marketing community will take the $0.10 profit, divide it by the $0.002 it costs to send the e-mail, and claim that the 50 to 1 ROI ratio is far better than the 1 to 1 ROI ratio found in catalog marketing. This isn't even a myth, this is just plain silly! Go with the activities that deliver the most profit dollars, period.
- No statement has been more damaging to the craft of catalog marketing than this statement. This statement is used by the establishment to maintain existing best practices. Instead of experimenting with the future, the statement is used to keep marketers entrenched in the past by demonstrating that customers love both old-school marketing and new marketing techniques ... strongly suggesting that without old-school marketing, the new techniques won't work. It turns out that the best customers do everything in "multiples" ... they buy from multiple merchandise divisions, multiple stores, they buy multiple items per order, they buy during multiple seasons, they buy from multiple sub-brands. Catalog marketers missed a decade of innovation by chasing a myth that you could somehow generate more multichannel buyers by sending more catalogs. Be honest, did that strategy work for you??
- Ugh. We continually see situations where the incumbent technology creates a myth, a myth designed to tie it to the technology that is destroying the incumbent. Hint: All channels have strengths, and all channels have weaknesses. Leverage e-mail based on what it is best at, leverage social media based on what it is best at, there's no need to link channels together to demonstrate the benefits of the incumbent channel.
- Exactly what rewards are they reaping? (and why do we constantly see the phrase "reaping the rewards" these days ...how exactly are we now defining 'rewards'?). CRM is in a fight for survival ... we've been hearing about one-to-one marketing and CRM for decades and in most cases we've been blessed with endless phone trees (push nine to speak to a live person). One-to-one marketing is being obliterated by social media, customers get to choose what they want, not brands. Be wary of anything that combines the phrase "Social" with the phrase "CRM" ... it's a marketing and technology pitch not supported by the desire of a customer to be managed by a computer.
- Embarrassing. Who convinced direct marketers that you must have stores, and who convinced direct marketers that customers love stores? It might be the banking industry, who loves it when a direct marketer takes dollars that would have been spent generating sales tomorrow (catalogs and e-mail and search) and then funnels those dollars to interest payments to banks to cover new store loans. Bricks 'n clicks is marketing pap. If you are an operator (i.e. a person who actually tries to grow brands, not a consultant), you know that the majority of e-commerce customers will buy from a store, but the majority of store customers won't buy from e-commerce. This means that the store becomes the black hole of your business, it is a place where the rules of gravity change! Your customers eventually change behavior, become less likely to buy online, and have their entire experience dictated by the store experience. Banks who lend money to brands with stores benefit, I'm not sure that the direct marketer benefits.
- Notice that customer centricity is seldom mentioned by businesses that provide great customer service. Customer centricity is often met with other buzzwords (one-to-one marketing, CRM). If you are fighting to make your business more 'customer centric', you are a noble and bold individual fighting a culture that doesn't care about treating customers as nicely as you believe customers should be treated. In those situations, no CRM solution makes up for the inaction of your co-workers.
- This topic deserves to be addressed twice! Explain this to me, folks ... explain how Amazon and Zappos and eBay and Netflix do so well without stores, while Borders and Blockbuster struggle to survive with integrated multi-channel strategies? There are always successes (i.e. Apple stores), and there are always failures (The Sharper Image, with integrated multi-channel campaigns). Everything is a probability, not a certainty. Have product that customers crave and outstanding customer service and you'll be successful no matter how you choose to market to customers.
- Ask yourself a question ... how many brands do you like to interact with via social media? Do you love to tweet that creepy Burger King character and say "Hey, Creepy Burger King Dude, nice commercial yesterday?" Be honest with yourself, this is a confection of a marketing audience that wants the global explosion of friend-to-friend communications to extend to brand-to-customer interactions. Sure, some stuff works (like when a customer needs help and you provide great customer service via social media or when a customer wants 10% off plus free shipping) ... but for most social media marketing tactics, it is one of those cases where probabilities come into play, you have one brand that does something and succeeds, but there is only a 10% chance of everybody else doing it and having it work for them, even if they execute perfectly. Social Media for business is largely a roulette table, you put your money on the number "14", somebody spins the wheel, and then you hope that you win.
- I once invited a group of co-workers to a party I was hosting at my home. One of my co-workers came with his entire family, walked in the kitchen, and grazed from the assortment of food platters, then left. One might posit that this family was engaged, they spent about ninety minutes at the party, they didn't "bounce from the home page" like other folks who came to the party and left ten minutes later. For some reason, we have this fascination with metrics that do not correlate with metrics that matter. The metric that matters, of course, is "profit" ... and when we can't find any innovative ways to increase profit, we move to other metrics we believe are loosely correlated with profit, namely, "engagement". If you can prove that there is a direct cause-and-effect relationship (i.e. customer visits, then customer buys, then customer becomes engaged, then customer becomes highly loyal only because of the engagement), then I'll buy the customer engagement argument. Otherwise, customer engagement is fool's gold, fun to measure, fun to theorize about, but uncorrelated with profit.
Myth: E-Commerce is the future.
- If e-commerce is so amazingly wonderful, then why does retail still account for 9 in 10 of all purchases, and has accounted for 9 in 10 of all purchases for decades? E-commerce is the logical extension of the catalog marketing model ... and we're likely to see mobile become the logical extension of the e-commerce business model.
- Compare Comcast/Dell with Apple. The former brands are social media darlings, the latter is not. Which of the three brands is known for innovative products that customers crave? Hint: Great products create social media buzz ... social media buzz cannot sell average products.
- The literature is filled with marketing pap about how integrated campaigns increase response. Here's a question for all of you ... if everybody is focusing on integrated campaigns and working so hard on improving response to individual or integrated campaigns, then why has the annual customer retention rate (the % of last year's customers who purchase again this year) remained flat or decreased for the past decade? All we're doing with integrated campaigns is shifting demand from non-campaign periods to integrated campaigns. We don't measure the right things ... we measure campaign response when we should be measuring annual customer behavior. Annual customer behavior seldom changes much.
- Spend five minutes with the Web Analytics crowd, and you'll be inundated with stories about how facts are continually ignored by business leadership. Horsefeathers!! Often, the story told by the analyst is incomplete or incoherent. Stories must have actionable outcomes. Stories have a better chance of success if data from non-web-analytics platforms is incorporated into the story. Hint: Executives respond to data stories when the Executive is likely to benefit from a strategy outlined in the story.
- For some reason, we now believe that if we just display the right information to business leaders, then business leaders will make better decisions. We can have all of the dashboards in the world showing the number animals being killed in the Gulf of Mexico by the big 'ole oil leak, but that doesn't mean that the problem will be fixed any faster or cleaned up any quicker.
- We keep reading about tests that yield a 42% increase over the control. If this is true, and we then implement all of the positive test results, then why aren't businesses doubling or tripling in size all the time? Testing and optimization works when you are testing strategies that have a long "half-life". Testing whether to use a large green button or a small yellow button might yield a 31% increase in one strategy, but that strategy has no half-life, meaning that customers don't truly care about the strategy on a long-term basis, it was simply something that was interesting for a day or two.
- This was the headline in a trade journal daily e-mail I received this week. Hint: I have written over 1,500 blog posts and have tweeted more than 3,000 times in the past four years. Nothing is easy, folks. Why are we so infatuated with easy solutions to wretchedly hard problems? Be willing to do hard work. Be willing to do innovative work. Be willing to fail.