Your Sugar Mama

There are so many bad marketing campaigns, we like to salute one when we find it.

Campaign: Sugar Mama

Sponsor: Virgin Mobile

(http://www.virginmobileusa.com/stuff/sugarmama.do)

Offer: Reward Mobil customers with extra minutes in return for

• Watching online videos
• Receiving text messages
• Filling out surveys

Details: Exactly how program works stated clearly and concisely on a answers page.

Execution: If you still have questions, there is an email address. And someone actually responds to the email with explicit answers within a day.

This is permission marketing as it ought to be. Customers can opt in and opt out at any time. Their participation is acknowledged with a simple token reward – for every minute you view our content, we give you a minute of airtime.

As a rate of pay this is way below minimum wage, but that beside the point. It is an acknowledgement and appreciation of the customer. When is the last time you got that as a consumer?

This straight forward clarity runs throughout. It’s easy to see what you get, what that costs, and what to do if you want to change your plan.

This shouldn’t be a big deal, but compared with the major communications carriers and cable system operators it is. It is the difference between earning customers and trapping them.

Best Practices – Do Not Make Perfect

Many of our clients assume that if a marketing stratagem or tactic is used by a major player it ought to be good. If a small to mid-sized firm can afford to, they’d do well to mount a similar program. “If (fill in the name of a feared or admired organization) does it, why don’t we?”

Consider the following. A major bank and credit card issuer sends multiple envelopes to arrive on the same day. One is a statement and with it the usual detritus of untargeted offers such as those blank checks allowing you to get cash at very high interest. The second package is more of the same, without the statement. Why do major firms clog your physical and electronic inboxes with multiple offers and why do they present the same or similar offers to customers, who over the years have shown no interest?

The cost to print, process, and mail offer, when you have scores of millions of customers is low. The return on those unfortunate folks who, for whatever reason, use those checks is high. Whether these programs have a high or even a positive ROI is tough to tell from outside the organization. Whatever the believed ROI, it is probably exaggerated, because it ignores several costs. These include:

• The cost in time and potential irritation and confusion to the customer of overlapping offers.
• The opportunity cost when customers perceive your company as inept and are less likely to buy other services from you.
• The avoidable waste of communications sent to customers, who by their history, have shown they are not interested in a product.

Of course, we should always be willing to test offers, but the offer above, was dead on arrival. Next time you get a communication from one of the big guys, don’t consider it an example of a best practice. You can do better.

Will The Cat Drool?

Waiting for Your Cat to Bark, A currently popular marketing book, makes much of the differences between cats and dogs. Not the obvious differences. Dogs are a metaphor for customers of yore. Cats are the new non-compliant customer. The authors go on to make a specious case that Pavlov, the Russian physiologist of salivation dog fame, is no longer relevant.

Essentially Pavlov showed that merely the (almost) simultaneous pairing of two stimuli results in the learning that these are associated. The classic case is pairing of a sound with food, such that hearing the sound produces salivation. The effect is powerful and ubiquitous and applies to you and me as well as dogs and cats.

So what? You might well ask. Pavlov’s model was and is the prevailing one for marketing communications. A product may have a complex, systematic and rational value proposition, yet most attempts to enlist customers are Pavlovian.

Marketers try to induce interest or favorable perception by pairing the product or brand with something else the prospect perceives favorably or associate its absence with something unfavorable. Favorable stimuli include sex, safety, children, money, admiration, food, affiliation, and domination.

This attempted association or “conditioning” to use Pavlov’s term, is easy to spot in broadcast advertising, but is common in print, direct mail, email and web sites as well as tactics derived from these such as viral marketing campaigns.

Consider this next time you watch the Super Bowl, read a direct mail piece from Dell computer or brows banner ads for on-line gaming.

AOL Is Dead - (Not So) Long Live AOL

AOL was not the first online service though it did predate the commercial Internet. It grew and grew and prospered whereas Compuserv, Prodigy, and numerous others are forgotten.

It was not a technology leader. That was not its value and its market was not technophiles. It was a service, which provided content, connectivity, and community before the Internet and during itsgrowth spurt. Even after the Internet was common, AOL offered a comprehensive service, which attracted and retained tens of millions of users. For millions AOL was the Internet.

What set AOL apart and made it preeminent was marketing. Not hyperbolic like Apple nor solid like IBM, nor memorable in creative or execution. As was said of Coca Cola in its glory days, AOL strategy was to be within an arm’s length of desire.

AOL diskettes and later CDs were in the mail, in magazines, at libraries, convenience stores, and post offices. They included a “free” trial and a competitive price. It was easy to join and not so easy to quit. If you had access to a telephone and $20/month you were in. So were 25 million others, at its zenith, circa 2000.

In the days before standard email addresses, AOL was easily the largest community of online users. An AOL screen name was, like a well known address, something people were reluctant to change. Rather like mobile phone numbers before mandated portability.

What happened? How did so dominant market player loose its market?

AOL was king of dialup and its market allowed it to prevail over competitors with lower prices and different offerings. Dial up is dying and the fortunes of the king declined with his domain.

This leaves AOL with millions of customers and increasingly less to offer them or make them stay. Its portal, content, free email, and other services delivered on an advertising pays the bills model looks, feels and smell sort of like Yahoo, MSN, or a number of others. If it controls costs, witness its recent layoff of 5000, it can survive for quite a while as one of many web media properties. As a key player, it’s gone.

RIP

Phonak Phonak

Quick, what’s a Phonak? Readers of sports news might recall that the winner of this year’s Tour de France, Floyd Landis, rode for the team sponsored by Phonak. The team is multinational, the company is Swiss, and Landis happens to be American.

Landis’ win propels Team Phonak to fourth place in 2006 ProTour ranks. Estimated cost of this sponsorship – at least 11 million Euros or slightly more than 14 million dollars.

Not insigficant for a $700 million (867 million CHF) company. And that doesn’t include Phonak’s sponsorship of America’s cup yacht racing.

What do you get for 14 big ones? Apparently not that much even with a winner. Phonak has already decided to abandon its marquee position. Next season, the team will be named for iShares. So much for a consistent branding message.

As of this writing, there’s a significant chance that will be the first Tour de France champion to be disqualified. Landis’ picture has been quietly removed from Phonak Cycling’s home page. If Phonak didn’t benefit from the win would they still be tarnished by the disqualification?

Getting back to our lead question, Phonak is a manufacturer of hearing aids and instruments. It markets its products under a variety of brands (micorSavia, Eleva, and eXtra), but does not appear to have products bearing the Phonak brand.

Accouding to its collateral,

“Phonak Hearing Systems is Main Sponsor of the Phonak Cycling Team and counts on the Cycling Team to carry the message of better hearing into the world.”

“Phonak supports the Phonak Cycling Team in 2006 for the seventh consecutive year. Phonak is convinced that hearing fosters communication among people around the globe and counts on its Cycling Team to draw attention to the topic of better hearing.”

“We race for better hearing”

One could imagine a campaign promoting athletes in need of hearing aids or one showing how these devices help people be more active, or many other posibilities at lower costs with positive ROI. As for this one. We’re listening but we’re not hearing this it!