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Technology predictions 2006

Toby Ward — Tue, 21 Feb 2006 17:24:12 -0600

Delloite Research has released its latest TMT Trends: Technology Predictions 2006. It refers to it as “The technology sector's top trends.”

Immediately I am skeptical since the intent is to predict the future which 98 times out of 100 is pure unabashed marketing. So I decided to see what DR considers the top 10 trends…

Search engines will challenge email as the leading digital application.
Research and development will become more collaborative as business, government and academic institutions increasingly work together on new innovations.
Offshoring as a way of minimizing costs and optimizing efficiencies will continue to grow in popularity.
Classrooms of the developed world will incorporate more digital aids in their instruction.
Open source will pose an ever-greater challenge to the established software model, impacting both providers and end users.
Governments will increasingly regulate the Internet.
Technological advances such as speech recognition and voice synthesis, along with improvements in artificial intelligence, will change the way humans interact with computers and computers interact with each other.
Products will become less static with the launch of many more devices, from cameras to cars, that can be upgraded remotely.
The gap between those with digital technology and those without will widen and put undeveloped countries at an even greater disadvantage.
Those technologies that permanently change human behavior will continue to be the most profitable.

Did anyone catch the first trend statement, “search engines will challenge email as the leading digital application”?

Does anyone really believe that? Who aside from those that hold the title or role as a researcher spend more time doing search engine queries than email? I can’t name a single one; not one. And I’m a power Google user undertaking 20-30 searches every day. Knowledge workers I know, those that have a computer at their desk, most average more than 75 e-mails a day. Some clients and colleagues process 500 or 600 emails a day. That’s extreme but I know of no client or colleague that processes less than 50 emails a day. I know of no client or colleague that comes close to undertaking that many search queries.

My point: we are being inundated by marketing messages every day and those messages are rapidly growing in frequency and rate. Some organizations are getting more clever in packaging their marketing. This report is a perfect example. DR is full of very smart people and very clever marketers. This report is superb marketing (I’ll admit that my company Prescient Digital Media does a little bit of this too. However, despite the name you'll not find me spending too much time on predicting the future, except for specific client endeavors).

Caveat emptor (buyer beware) – not everything you read is the truth.

NOTE: It is my goal to be as honest as possible in my writings and severely limit if not completely eliminate any commercial messages within articles if it has no relevance to the readers (you’ll also note that I have forsworn any Google ads on either of my blogs or websites). Sometimes however I may separately promote an event or a job opportunity that might be relevant to the user but has no direct compensation relation to the author. Though if you suspect me of trying to use any of my articles as a direct sales tool then feel free to call me on it.

The e-mail marketing challenge of 2006

Toby Ward — Mon, 09 Jan 2006 14:24:45 -0600

Spamming is killing us. Well, death may be overstating the problem, but spamming is frustrating users and marketers alike and its financial impact on legitimate marketing can’t be understated.

Read rates of marketing e-mail is in serious decline. More and more users hit delete before they even glance. DoubleClick reports a 24 percent year-over-year decrease for all mail in its Q2 2005 E-mail Trend Report. That means a dramatic downturn in average campaign revenue and an industry loss of tens-of-millions of dollars compared to previous years.

The problem is spam. Spammers give all marketers a bad name. The good news is that the law is now starting to hammer some of these e-mail bandits. An Iowa judge pounded a Florida spammer, awarding $11.2 billion in damages to an Iowa ISP after it received millions of unsolicited e-mail. Yes, billion. You probably received some of the wicked e-mails from the notorious hood in question advertising mortgage and debt consolidation. Damages were calculated at $10 per illegal e-mail.

An increasing challenge, compliments of the trend wrought by spammers, is that more and more users are turning-on image blockers that turn-off images in an HTML e-mail. While spam e-mail images are turned-off, so are legitimate e-mail images.

To overcome these challenges you have to build trust with your readers which requires their permission and a transparent relationship with synchronous (two-way) communications.

Here are a few tips for overcoming these challenges:

Get their permission.

Double opt-in is strongly recommended.

Opt-out option on all correspondence.

Privacy Policy is a must .

Write succinct, punchy subject lines.

Strong opening body text (non-image) emphasizing the buyer benefit.

Third-party lists are strongly discouraged; ditto for sharing.

Provide links to back issues and related information.

Ensure a strong offer in every e-mail.

Call to action should have short deadlines.

Measure response to e-mail offers; tailor campaigns based on response.

Ultimately your e-mail success will depend largely on how well you know and understand your readers and how well you tailor your efforts based on their needs and expectations. As such, don’t be afraid to ask for feedback and to undertake surveys. Heck, try phoning a few with a polite telephone survey – you might just further strengthen a valuable relationship.

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Web marketing 101

B2B prefers offline marketing

Toby Ward — Mon, 28 Nov 2005 18:54:11 -0600

Those of us that are in the business of selling products and services to other businesses (B2B) know full well that traditional consumer marketing does not work for our business. There is no better way to waste your marketing money than on traditional advertising on radio, television or newspapers.

B2B marketers prefer to spend their money on more traditional, organic methods, but with an increasing budget directed to digital and e-mail marketing. In fact, according to a Forrester Research study highlighted by e-Marketer (B2B Marketers Shift Budgets to Online), in-person event marketing such as tradeshow participation is the number one preferred tactic of B2B marketers.

Although TV is listed as the 5^th most popular tactic, I’m sure you’d find that much of that TV advertising is targeted cable TV advertising on specialty channels such as the Money channel or MSNBC.

Of particular interest to digital strategists such as myself is that no digital marketing makes it into the top 5 tactics. After the military and education, B2B were the first early adapters of digital marketing and electronic sales. Electronic Data Interchange (EDI) was being used by many B2B companies before many of us had even heard of the Internet. Despite this early mover advantage into the digital world, B2B marketers have not discounted more traditional methods such as face-to-face and PR.

The good news for digital media buyers and marketers is that digital marketing –such as e-mail marketing and paid search – is being used more and more often by B2B companies and is projected to be the number two tactic of choice by 2008.

ANALYSIS

Traditional, organic marketing such as in-person events and public relations works best for many B2B organizations. Digital marketing, particularly targeted permission marketing (see Web marketing (part III): E-mail marketing ), is becoming more effective and will continue to garner more and more of the marketing pie. Increases in digital marketing budgets will continue to be at the expense of less successful media such as newspapers, printed newsletters and radio.

RELATED FEATURES:

Web marketing (part III): E-mail marketing

Web marketing (part II): Paid search

Web marketing (Part I): search engine optimization

E-mail marketing 101 (Permission marketing)

Toby Ward — Tue, 01 Nov 2005 00:07:23 -0600

I hate spam. You hate spam. We all hate spam. Yet, just like negative political advertising during the heat of a hot campaign, it works brilliantly.

In fact, except for traditional direct marketing, there is no single more effective marketing tool.

Here are some of the numbers:

Ø       Only telemarketing has a higher ROI than e-mail (IAB)

Ø       In Q2 2005, the open rate fell to 23.6 per cent versus 2004 (DoubleClick)

Ø       Bounce rates, which were at an all time low at 7.9 percent, declined 25 per cent from 2004 rate (10.5 percent) (DoubleClick)

Ø       Orders per e-mail delivered were 0.35 percent in the fourth quarter of 2004, an all-time high and much higher than the previous records - 0.30 percent (DoubleClick – based on 2.5 billion e-mail sent)

That last number is very telling. It means there’s a sale, on average, for every 300 e-mail solicitations sent. While it depends on how you do it, the cost of sending 300 e-mail is next to nothing. And this is why e-mail marketing continues to be wildly successful despite the stigma against spam.

To be honest, the real winners are not those marketers that are spamming (though some are wildly successful), but those that undertake permission marketing.

Permission Marketing

Coined by online marketing guru Seth Godin, permission marketing is a sales approach used by a marketer to obtain advanced, explicit permission from a sales prospect before sending them marketing information. In other words, a person gives you permission to sell them – usually in the form of opt-in e-mail.

Of course, we’re all familiar with opt-in e-mail – usually it involves signing-up for a newsletter and then they ask you to also divulge some personal information and whether or not you’d like to receive some special offers. Double opt-in means you are sent a confirmation when you agree to sign-up and you’re expected to confirm that you are in deed providing your permission to receive marketing information.

Permission marketing is a big business. Generally speaking, PM is more effective and the response and conversion (sales) rates are higher because people want to be marketed to (yes, of course, plenty slip through the cracks and still treat this marketing as spam but it’s still more effective than blind spam).

Show me the money

“What kind of returns can I expect?” you ask. Well, it depends on many factors of course. A key of course is the quality of marketing list...

Are your e-mail targets voluntary opt-in subscribers?

Are they past customers?

Do they know what to expect from you?

The more your subscribers know you, know what to expect, and have purchased from you, the better your success.

Like any business, you do have to spend money to make money. However, you don’t have to break the bank.

In a ClickZ column this summer Jeanne Jennings featured in a great e-mail marketing case study The Little E-Mail Marketing Budget That Could. The company, Dakin Farm, is a small, family-owned specialty foods company in Vermont.

In 2004, Dakin Farm had an e-mail marketing budget of a little under $14,000. It sent regular marketing offers three times per month (on average) via e-mail to its subscriber base of some 13,500. The return was huge. Total sales equaled $185,000. That’s an ROI of 1300%.

The click-through rate was fairly standard: only 4.34% of recipients clicked on specific offers. But of those that clicked, 98% bought.

Jennings quotes the following reasons for success, right from the owner’s lips (Sam Cutting IV):

Everyone with a direct response Web site should build an e-mail list and send offers, even if the list is small.

Measure response to e-mail offers.

Determine your breakeven.

Increase the frequency of sending e-mail to a level that feels right and is above breakeven.

Ensure every e-mail contains a strong offer.

Use short deadlines as a call to action.

More Tips for success

Firstly, use e-mail to communicate with your customers, but get their permission:

Ø       Double opt-in is strongly recommended

Ø       Opt-out option on all correspondence Privacy Policy is a must (PIPPA requirement)

Ø       Third-party lists is strongly discouraged; ditto for sharing

Ø       Provide links to back issues and related information

Ø       Write succinct, punchy subject lines

Ø       Don’t be shy – be persistent

Jeanniey Mullen (also a ClickZ columnist) recently cited an insurance company (My Last ClickZ Column Had A Typo) that decided to re-connect with e-mail subscribers that had not read an e-mail from the company in the past six months. The company established a system that automatically sent a message to those subscribers who hadn’t opened an e-mail in the subsequent six months.

The e-mail team used the following subject line:

"WTF! Don't you like our e-mails?"

For those of you that don’t use instant messaging, WTF stands for “What the ____ (expletive)?

The response to the edgy but frank e-mail was impressive: 25% of those non-readers opened the e-mail. And, over 500 replies came back replying why they weren’t reading the e-mail messages – valuable feedback for future campaigns.

Bottom line: don’t be shy – get out there and start getting to know your customers (and potential customers). They want to hear from you.