January 25, 2005
Everyone’s a Direct Marketer, Part I
I had breakfast a few weeks back with John Greco, the new CEO of the Direct Marketing Assocation, and was telling him why I felt it was essential that interactive marketing be included in the DMA’s mainstream mission and not regarded as separate. The substance of my argument was that the Internet has turned every company into a direct marketer, whether they know it or not, whether they like it or not, and whether they care to act like one or not. I was happy that John agreed with me!
I’m going to write a three-part posting on this topic. First topic: Why is this happening?
1. The mechanics are now ubiquitous. Every company’s web site, every keyword to drive a customer to the site, every link to a customer service rep, every email that goes out to a customer list — they’re all direct marketing mechanics that pre-Internet, only specific categories of companies like catalogers or fundraisers employed to drive business. Now, every company has or does these things as a cost of being in business.
2. Mass marketing is no longer quite so mass. Audiences are becoming fragmented across hundreds of TV channels and millions of web sites. I heard a great speech the other day by Strauss Zelnick, one of Return Path’s investors and the consummate media executive, which crystallized this point for me with the following example: 20 years ago, a mass marketer could reach 80% of American women by running a commercial on ABC, NBC, and CBS at the same time at certain times of the day. In order to achieve that same reach today, a marketer would have to advertise on 120 channels (and I’d add, thousands of web sites). This fragmentation means that marketers have to get increasingly microtargeted and innovative in order to reach customers and prospects.
3. The balance of power has shifted to consumers. Don’t like that ad? Use TiVo to skip it. Hate popups? Install Google’s toolbar to block them. A company you’ve never heard of is emailing you? Report them as a spammer to your ISP. Hate phone calls from telemarketers? Sign up for the Do Not Call List. Permission is here to stay, and companies that “get it” will win the day with massive databases of customers who have requested to be marketed to via email or other channels. But all of that’s direct and not very reliant on the mass advertising machinery that propelled companies and products to greatness in the past.
Next up in the series: Why is this new to some companies, and what lessons can companies who are new at it learn from traditional direct marketers?