Death of the Agency? Not So Fast …

The last season of “Mad Men” is approaching, but let’s not be so fast to bury the ad agency with it. Media outlets are reading trends and are raising questions. The Economist has a special report on digital disruption in the advertising supply chain, and is quite taken by how “Big Digital’s”

The last season of “Mad Men” is approaching, but let’s not be so fast to bury the ad agency with it.

Media outlets are reading trends and are raising questions.

The Economist has a special report on digital disruption in the advertising supply chain, and is quite taken by how “Big Digital’s” profit margins and programmatic media buying have come to dominate advertising and audience selection. In one article, “Leaner and Meaner,” they’re saying:

The ad-tech firms are gleefully forecasting the imminent demise of Madison Avenue’s middlemen, but they may be wrong, for two reasons. First, ad tech has introduced so much complexity into the business that clients may want to hold on to agencies for advice, and agencies’ creative services are likely to remain in demand when brands are having to churn out so many different pieces of content.

Second, the prediction that technology companies like Google will start to compete head-on with the agencies is likely to prove wrong. To provide full client services they would need to hire thousands of new employees, for limited gains. Google’s margins this year are expected to be around 50%, whereas WPP’s are forecast at just 17%-and that is for the largest and one of the most successful advertising agencies. Perversely, the agencies’ mediocre returns may protect them from being wiped out by nimbler competitors. Their tents in Cannes may no longer have the best views, but the admen will still be there.

Mobile Marketing Watch had its own agency pity-party headline last week, “Are Yesterday’s Advertising Agencies Finally Dying?” reporting on a UK opinion piece:

As the challenges marketers face increase, the solutions from agencies shrink. It’s time for them to step up.

That’s the opinion of Tom Goodwin, founder and CEO of the Tomorrow Group, in a recent post at The Guardian.

“There is a curious tension in the current agency landscape—a vast mismatch between what clients’ needs are and what agencies are working on, and this gap seems to be widening,” Goodwin explains.

True, Goodwin admits, the Internet has been both a blessing (new opportunities) and a curse (change is always hard).

“The internet has been a mixed blessing, a volatile combination of incredible, new possibilities, rampant change and some of the most destructive forces the marketplace has ever seen,” Goodwin contends. “On a communications level, we have a plethora of new media channels, memes circling the world in seconds, the app of the moment bursting onto the scene, and trends like content marketing, native advertising and influencer marketing to navigate and leverage. The options seem more bewildering than ever and more abruptly changing, all in a context where attention is moving onto platforms which become even harder to connect with people.”

What’s to be done? Goodwin believes agencies need to up their games.

What does raising their game look like? Yes multiple screens and a crush of data are inflicting huge demands for content—some of it targeted to a few eyeballs. The scramble for creative, analytics and insight talent must be accomplished as agencies seek to keep their historic role as strategic counsel, with built-in expertise to deliver that counsel all under the same shingle.

That won’t be easy—The Economist says advertising is not the first choice for math students, for one—but skills matching must be a priority of agencies, because brands need guidance through the technology maze, and they need break-through content that engages wherever the consumer may be—something ad tech cannot or will not generate on its own.

By the way, Big Digital has its own death predictors, too.

Be Warned of the “Professional Plaintiff”

A client recently received the ultimate “shakedown” letter—claiming violation of the California CAN-SPAM law as a result of getting eight emails, demanding $80,000 in statute-mandated damages, yet willing to settle for $2400. Unfortunately, this has become a cottage industry. The California law has a private right of action that has been taken advantage of by a few noteworthy legal vigilantes. Their actions have created a template for the “shakedown.”

[Editor’s Note: Gary Hennerberg is traveling this week, but attorney Peter Hoppenfeld has stepped in to supply this week’s blog.]

A client recently received the ultimate “shakedown” letter—claiming violation of the California CAN-SPAM law as a result of getting eight emails, demanding $80,000 in statute-mandated damages, yet willing to settle for $2400.

Unfortunately, this has become a cottage industry. The California law has a private right of action that has been taken advantage of by a few noteworthy legal vigilantes. Their actions have created a template for the “shakedown.”

To add insult to injury, the “professional” victim opted-in herself for each of the lists that she claims issued a spam email. I’m fairly sure that she probably has a cyber-ambulance chasing attorney ready to pounce on a contingency basis.

What do you do?

The American Corporate Counsel Association has issued a white paper that is very helpful. Seems like the SPAM demand toolkit left out one key defense—if your ISP has reasonable processes in place to prevent spamming, the statutory damages in California are reduced from $1000 to $100 per occurrence.

Quoting my letter:

First, it is clear that you are following a textbook (albeit outdated) approach of a “professional plaintiff” under the California anti-spam law. Attached is a copy of a White Paper prepared by the Association of Corporate Counsel that clearly rebuts each and every point that you have raised in an attempt to coerce my client to pay you monies.

We are in possession of proof that you opted into a number of email lists as proof that these emails are not unsolicited. Even if unsolicited, all of my client’s emails contain compliant opt-out links and you have not elected to take advantage of that option.

The element of the California law that you conveniently ignored is Section 17529.8 which reduces the potential statutory damages to $100 per occurrence. Please note:

” … working with reputable email service providers (ESPs), advertisers can be more confident that recipients did opt-into receive commercial email. ESPs generally maintain or can produce evidence of each opt-in, in the form of IP address from which the consumer opted-in, date/time stamp of opt-in, and other information. {NOTE: ALL IN OUR POSSESSION.}

While plaintiffs may contest the veracity of such evidence in a proceeding, once the evidence is produced, the burden to show it is inaccurate generally shifts to the plaintiff [NOTE: WE ARE UNAWARE OF ATTORNEYS WHO WILL TAKE A MATTER ON CONTINGENCY WHEN THERE ARE BURDENS OF PROOF SUCH AT THIS.}

More importantly, statutory damages under the Code of $1,000 for each spam are reduced to $100 for each spam, when there is evidence that a defendant established and implemented practices and procedures reasonably designed to effectively prevent spamming. {NOTE: SUCH PRACTICES AND PROCEDURES ARE IN PLACE.}

Accordingly, we deem your demand a “shake down” and a nuisance, and to save time and expense offer you the sum of $800 in full and final settlement of this matter. No monies will be provided to you unless you agree in writing: that no Spam violation took place; to maintain the terms of this arrangement confidential; and to agree to a penalty of $10,000 if it is determined that in the future you are engaged in any attempt to assist others to assert this type of claim against my client.

The matter settled, but the complainer remained indignant. Unbelievable.

Key takeaways:

  • Have a complete understanding of the CAN-SPAM laws.
  • Use an identifiable “from” email, a non-deceptive subject line, include a physical address, provide for an opt-out link and remove people who opt-out within 10 days.
  • Even more importantly, if affiliates are mailing for you, make sure they “scrub” their lists against your Suppression list.

Good Luck All. It’s a jungle out there.

Peter Hoppenfeld is an attorney and adviser in the representation of direct marketers, speakers, authors, information marketers, “thought leaders,” entrepreneurs and domestic and international training companies and their founders. Reach him at peterhoppenfeld.com.

Email Marketing: To Open or Not To Open …

For many of us, choosing the from name is a simple task. We send it from the person to whom we want the recipient to respond or connect, but hold on … did you test that?

For many of us, choosing the from name is a simple task. We send it from the person to whom we want the recipient to respond or connect, but hold on … did you test that?

One of our clients sends more than a million emails daily to their subscribers. They have built their list using a variety of resources, one of which was to purchase three million self-identified target recipients, but they also used co-registration with a daily newsletter offer to acquire another million names over a span of a few months. The co-registration names were a double-opt in so ideally should have produced stellar results and highly qualified names, but that didn’t actually turn out to be the case.

After sending to the purchased list, we tossed it completely due to the very high number of spam traps we managed to trigger in our first two sends. With those names eliminated, we focused on the co-registration list, which we segmented into large groups to receive the daily message they had been offered. This was done through more than a dozen different ESPs.

As we saw it, job one was to validate the email addresses were deliverable, not spam traps, and were—at best—being opened. As we suspected, a number of them were spam traps, so we dialed it back and a great deal of time to a deep-cleanse effort of sending in very small batches (about 200 per day per ESP) in order to more easily stop the cycle if we irritated more spam sensors. (It takes a long, damn time to send to millions of recipients at the rate of 200 per day.)

Using this process, once we reached 250,000 verified emails, we sent to those in larger groups through our three best-performing ESPs—those with whom we historically saw the best deliverability rates. We continued these two steps with the balance of the names and applied the deep-cleanse process for new names still coming in through the co-registration sites (about 500 names per day).

The combination of the deep cleanse and slow send improved our results drastically. All emails were deliverable, unsubscribes were low, but open rates were still lagging. Since this was a daily message to which the users had specifically subscribed, we were pretty sure there was room for improvement even though the list was growing faster than the combined attrition rate (unsubscribes + undeliverable + spam complaints), and traffic to this site was flourishing.

While our client does not sell anything on their site, they do sell ad space in the daily email, monthly newsletter and on their website. The number of views for these ads is critical to our client’s revenue. Emails going unopened, being marked as spam, or gaining an unsubscribe are not generating revenue in a click or impressions ad placement.

Regardless of which email application the subscriber uses, there are two things they see: from and subject line. Some email applications will also show the preheader text, a preview, or other snippets to give the recipient more clues about the content. We chose to tackle first the sender information, and then work on the subject line. After all, there’s only so many ways we could say, “Here’s the daily email to which you have subscribed.”

The target audience for this daily email is largely male—not all male, mind you, but nearing the 85 percent mark. I suspected males would rather receive emails from women, so we started there. We also used tried other sender names and email addresses:

  • Company name
  • Site owner’s name (she has some visibility in this space, so we tried to parlay that recognition into opens)
  • General email address
  • Mature-sounding woman’s name
  • Young-sounding, woman’s name
  • Sexy woman’s name
  • Mature-sounding male name (in line with the target audience age group)
  • Young-sounding male name

We didn’t just change the from name, we created a matching from address for continuity and credibility (rather than use a system address such as newsletter@companysite.com). For instance, if Brittni Jones was the from name, the address was brittni@companysite.com

What we found, and what I’m sure you already know, is sender matters—in a big, important way; at least for this client.

I was right on one front: This primarily male constituency did open far more emails from Brittni than Edith, but they also liked getting emails from Trevor, a very close second. They didn’t read nearly as many emails from Bob, though Bob was more popular than using the company name. The actual statistics for this campaign are not important; your company would experience completely different results. The takeaway here is about testing and being relevant—even at the sender name and address level.

If your opens are suffering, think first about whether or not John Smith is convincing enough to get me to open, then remember: test, track, tweak. Repeat.

Using Video Production as Part of Your Customer Retention Strategy

Video is a tool designed to communicate with your customers. If you follow the statistic “80 percent of your future revenue will come from 20 percent of your current customers,” you know that the greatest part is to keep your customers happy so they keep coming back. The best way to preserve your clients is to keep them engaged.  You can keep your clients engaged by offering new videos about your product or service

How strong is your relationship with your customers? Do you have a customer retention strategy in place for your business? What are you doing to maintain your customers loyalty?

These questions are extremely important, and it’s up to you to come up with ways to maintain a healthy system designed to keep your customers and help them grow with you not against you. These hints will give you some fresh ideas that you might not have considered to plan on growing your client retention.

Video is a tool designed to communicate with your customers. If you follow the statistic “80 percent of your future revenue will come from 20 percent of your current customers,” you know that the greatest part is to keep your customers happy so they keep coming back. The best way to preserve your clients is to keep them engaged. You can keep your clients engaged by offering new videos about your product or service. Be careful not to over due it with the social media. People will get angry if you spam them out on Facebook and the like. Thinking of new ways to communicate to your clients is a big responsibility, but with a few solid ideas, you can give your customers a dose of encouragement and keep them wanting to know more about what you can provide for them.

Video can be a great answer as it’s good for promotions, technical issues, special discounts, customer appreciation, etc., etc., etc. Keeping the client engaged is one thing, but the end goal should be to keep your clients devoted to you and your brand. Video allows you to communicate with the message you want them to receive while sending that message to more of your clients. Although this can never take the place of the human element in communication, it can be a terrific alternative for when you need to send the message to the masses.

Here are some ideas that will help gain trust with your clients, keep them remembering your products, and accepting your messages.

  1. Product review
  2. Customer support, repair, assembly
  3. Customer conferences
  4. Customer testimonials
  5. Employee testimonials
  6. New product launch
  7. Webinars
  8. Video newsletters and blogging

Video featuring your product or someone talking about a focused area of your service can be extremely effective, not only by gaining a lot of attention on YouTube, but also developing trust by demonstrating your product online. Remember to have a lot of cutaways and b-roll (the images that support the dialogue).

Customer support, repair and videos of assembling a product can not only be useful to post online, they can save you money by not hiring staff to answer specific and common questions. There is customer service 24/7. More companies are using Vine for this type of video communication. Vine is great because you can create video with your cell phone. However, remember that these can only be short videos. Companies like The Gap have found this to be a unique tool to their culture.

Customer conferences are great and you can get some exposure through press releases announcing the conference. Depending on the success of the conference, often times you can gain some additional sales through word of mouth. Word of mouth is the best advertising possible.

Testimonials are always terrific for people looking to do business with new companies. Testimonials can be effective by selecting real clients, with real stories that they can relate to. Also, give your interviewee enough time to prepare what they would like to say. Remember not everyone is comfortable around the camera. Even a cell phone can be intimidating when you aren’t sure what to say.

Any time you have a new product a video, it should be on your marketing strategy. People love to read about new products, but they love it even more when they can find out pertinent information about that product for 30 seconds. Disney Collector BR on YouTube discovered a way to make a living from product reviews. She has over 800,000 subscribers who want to know what the toy features before buying it.

When it comes to B-to-B marketing, one of the best ways to make an impact on your clients is by hosting a webinar. Incorporate video subscription to those that want to attend but cant, so that they don’t miss your important message. Webinars are great because they are informative as well as valuable.

Last but not least is the use of video blogs. When your clients are interested in what you have to offer a newsletter or blog keeping them updated helps to build a relationship with them. I know many executives that utilize this method of communicating to their teams overseas and abroad.

There are thousands of terrific ideas for using video as part of your customer retention strategy. Video can always be measured by viewership and analytics. In any case if your goal is to get your clients to be loyal to your brand then using video as part of that net will be sure to help you succeed.

Please Move Over … You’re Blocking the Content

Have you ever clicked on a banner ad? According to Solve Media, you’re more likely to survive a plane crash than click on a banner ad—but yet they are still a major part of many marketers’ advertising budgets. Recently, we were hounded by a radio rep who wanted to know when we were going to take advantage of the “value added” bonus he was offering to our client. The value-add was in the form of a free digital banner on their site

Have you ever clicked on a banner ad?

According to Solve Media, you’re more likely to survive a plane crash than click on a banner ad—but yet they are still a major part of many marketers’ advertising budgets.

Recently, we were hounded by a radio rep who wanted to know when we were going to take advantage of the “value added” bonus he was offering to our client. The value-add was in the form of a free digital banner on their site.

I’ll admit that we were procrastinating since we (and the client) didn’t think that the time and energy it would take to design the banner ad would be worth it, since neither of us believed that their high net-worth target would be perusing this particular website. But here are the facts: Since January, our banner has delivered 288,278 unique impressions. 535 individuals clicked on the banner (0.19 percent).

Did it result in any visits to the clients’ retail store? More visits to their website? More sales? It doesn’t seem so because the offer on the landing page (mention this station and get X percent off your purchase) has never been leveraged. But stimulating interest in the clients’ brand among 535 people is a good thing … right?

My real issue with banner ads is how obnoxious many of them have become.

Often, you type in a URL to visit a website, but before you can see the page, you have to look at (or hopefully can bypass after 3 seconds) some form of advertising. It’s akin to waving your arms in front of me and shouting, “Hey! Toilet paper is on sale on aisle 4,” while I’m trying to look at the cheese choices in the dairy aisle.

Even worse is when the arm waver isn’t advertising anything relevant to my grocery store visit. Instead, they’re waving and shouting, “Hey! There’s a single guy in your area looking for a date!” Gosh, I hope he’s not stalking me while I select my cheese …

Of course, I realize that many websites accept advertising from a variety of advertisers, and generating revenue may be their No. 1 goal, but my reaction is often that I am reluctant to visit that website again if the advertising is so obnoxious that it distracts from my consumption of content.

Placing banner ads in a relevant environment makes total sense to me. Dog food ads on a website about pets … ads for tires on a website for car lovers … got it. But to optimize your clickthrough rates, I believe the choice of ad placement needs thoughtful consideration of the mindset of the Web visitor and the information they were seeking when they landed on that site in the first place.

Because the next guy that waves in front of my attempt to consume content on any site and shouts “Hey! Your opinion counts!” is going to get answers that will totally screw up their survey results. Just sayin’ …

If You Speak, Will They Listen?

Yesterday, I was one of two speakers at a webinar hosted by Target Marketing. During our prep call earlier in the week, the host advised us that over 1,000 people had signed up to attend this free event. Now I know from past experience that only 50 percent will likely attend, but another 10 percent to 20 percent will listen to the podcast after the fact. But despite providing case studies, facts and figures based on industry best practices, the disappointing reality is that very few “attendees” will ever try to implement the lessons that I shared

Yesterday, I was one of two speakers at a webinar hosted by Target Marketing. During our prep call earlier in the week, the host advised us that over 1,000 people had signed up to attend this free event.

Now I know from past experience that only 50 percent will likely attend, but another 10 percent to 20 percent will listen to the podcast after the fact. But despite providing case studies, facts and figures based on industry best practices, the disappointing reality is that very few “attendees” will ever try to implement the lessons that I shared.

How do I know this? Because I’ve worked with hundreds of clients and have spoken at dozens of conferences and am continued to be amazed at how many companies feel the need to reinvent the wheel.

For example, when presented with a prospect’s particular marketing challenge and we recommend a fully integrated campaign solution that includes online and offline initiatives, the client says “let’s test to learn what will work best.”

Really?

I’ve been involved in testing for my entire 30+ year marketing career. And I’ve tested offers, colors, premiums, even signature lines, and those can yield very different results client to client. But here’s the one thing I don’t need to test: A fully integrated marketing campaign will outperform a single medium campaign every time. Why? Because different people consume information differently.

Some spend time online and click through banners, buttons or SEM results. Others gather information at conferences and webinars. Still others open and read email and direct mail.

Net-net, at some point, if they have a need, they will raise their hands in some way, whether they accept an inbound call from your sales rep or make a call into your call center. Perhaps they’ll visit your website and download something? Or visit your booth at a tradeshow?

The source of the “lead” will be misleading if you’re trying to measure and prove ROI, because they were exposed to your message in a number of ways and just because they finally raised their hands, you assign them to one channel and credit it with being the driver of leads. The next thing you know, you’re shifting marketing dollars to that one channel, and yet a year later you’re wondering why lead volume is down.

On the other end of the spectrum, I’ll meet new prospects who say their last (single channel) marketing campaign didn’t work. Therefore the (single channel) is a waste of money.

After digging a little deeper, the prospect didn’t really know where the “list” came from, or what the “offer” was or whether the campaign ran during a hurricane which meant that no one was online searching for their particular product during that particular week.

Here’s the key takeaway: Well planned, fully integrated campaigns usually yield the highest number of leads at the lowest cost. And the key to real sales success is the follow up.

Follow up those leads with an intelligent combination of emails and phone calls based on lead value (oh yeah, don’t forget to ask two or three questions when acquiring that lead so you can score its value to the organization), and—here’s the most important part—actually follow up with emails and phone calls that demonstrate to that prospect that you understand his or her pain and have the experience and solutions that can help solve the problem. In other words, talk to them in a language they can understand.

When prospects complete an online form and complete the box that asks “Industry” by choosing “Manufacturing,” don’t contact them as if they are in healthcare. If the forms asks for “Company Size” and the respondent chooses “1 to 10,” then treat that respondent like the small business it is. Demonstrate that you understand the challenges facing small businesses in manufacturing and you’ll gain far more credibility and brand engagement.

The next time management asks you to reinvent the wheel to solve the marketing challenge, tell them you already know what to do, because you’ve done your homework.

Only Trust Professionals – and Other Lessons From the NFL

I’m not even a big football fan, but I could certainly relate to the pain felt by the Saints when that last minute touchdown call was ruled against them. Of course the problem was with the inexperienced referees, called in when the professionals went out on strike. The same blame game is used when a direct marketing campaign goes awry. The client’s pointing its finger at the agency for its work/ideas, while the agency’s pointing its finger at the client for its direction/changes.

I’m not even a big football fan, but I could certainly relate to the pain felt by the Saints when that last minute touchdown call was ruled against them. Of course the problem was with the inexperienced referees, called in when the professionals went out on strike.

The same blame game is used when a direct marketing campaign goes awry. The client’s pointing its finger at the agency for its work/ideas, while the agency’s pointing its finger at the client for its direction/changes.

A successful direct marketing campaign is comprised of many complex facets—and it takes knowledge, experience and expertise to execute it flawlessly.

Despite the fact that many agencies claim complete integration and global knowledge, the reality is they often talk a good strategic game, but when handed a DM assignment, the executional details are left to the inexperienced.

I’ve received several calls recently from colleagues who want me to “help their agency” with the direct mail portion of a campaign. Not the strategy or the creative (their agency won’t let anyone touch that golden egg), but the list. It seems the agency doesn’t know the first thing about lists … and had been trying to sell the client something found on the internet from an unknown supplier.

That’s like asking the NFL referee to make the call on the Saints interference, but not on the Seahawks touchdown. The two are inexplicably entwined.

So I am asking, no begging, that clients identify and leverage agency partners based on their specialty. Spend your time understanding what skills are truly in the agency’s wheelhouse—and not a “sure, we can do that too!” skill. If the agency specializes in branding, then that’s what they’re probably very, very good at … and if it specializes in digital marketing (kind of a broad skill, but whatever), then ask them for help with your digital needs.

Good direct marketing agencies understand how to step back and think about your marketing needs based on your business goals and objectives. They delve deep into target audience research, trying to understand the audience mindset and identify key messages that will resonate and motivate a response. They may, in fact, recommend that you don’t use email (horrors!) or direct mail (gasp!) in your campaign mix for a variety of reasons, including the inability to find blue-eyed, left handed crane operators in any meaningful quantity that would make sense.

Good direct marketing agencies know how to source lists that are compiled from reputable sources. And they know how to evaluate those lists, identify the potential winners, and set up an unbiased test matrix to test and learn from a statistically valid sample size.

Good direct marketing agencies know how to design a campaign that will yield the desired response from the target. They’ll have solid rationale as to why a #10 package makes sense instead of a postcard, or why a three-panel self-mailer doesn’t make sense—even though your brand agency designed one that was “cool.” Or why an email shouldn’t consist of product images, or have a Subject line that’s longer than 40 characters.

Good direct marketing agencies know how to write compelling teasers, headlines, subheads, Johnson Boxes, P.S.’s and body copy based on years of testing and experience. They know how to leverage customer quotes, and the difference between a brochure, a buckslip, and a lift note.

Good direct marketing agencies don’t pick an offer because it sounds like fun, or because the client wants to get rid of the pile of chachkies in the warehouse. Their recommendations for offers is based on a deep understanding of what can motivate a target, an evaluation of the ROI model, and in-depth experience based on years of testing.

So if you view direct marketing as a skill set that can be handled by the temporary ref, then let your branding agency take charge. But if you want real results, bring in the pros.