Top Marketing Speaker Says New Media Not Nirvana For Marketers…
So here I am, blogging… using the new media.
But it’s no secret to anyone that I am not ga-ga over the new, digital media.
Look, I was one of the first people to get involved with the internet as enterprise, back in the 90’s, when my partners and I started one of the first-ever internet malls. We were pioneers, and we had some notable successes. But I was amazed at how fast it fizzled, in favor of the next digital marketing craze, and then the next, and the next and the next.
Two industry reports have recently crossed my desk that are actually quite revealing.
The first came from Chief Marketer, an online publication of Penton Media and MeritDirect. It’s called Lead Generation in Business-to-Business Marketing 2010 – Attitudes, Aims and Outlook.
All the questions related to media usage in the report of this survey of marketing managers, indicate a high degree of concentration on email and social media. Almost 92% said they’d be using email and over 97% said they’d be using social media, for prospecting purposes.
Digital marketing is clearly “all the rage,” and it looks on the surface like everybody in the know is turning to these digital solutions in droves. Nobody wants to be left out. In fact, the swell is so pervasive, that it appears managers, owners and exec committee decision makers almost feel guilty if they don’t buy in to the internet media craze.
But could it be that this Emperor has no clothes? Nowhere did the report talk about historical results from these efforts last year, or ever. I understand the concept of “early adopters,” but 97% early adopters? I think there are more “when in Rome-ers” than actual “Romans” in this case.
That’s not to suggest these web 2.0 media are all that new either. Some have been around for quite a relative while. But they remain unproven, at least as a direct route to sales.
What’s more is the irony that the more people who jump on the digital media bandwagon, the tougher it becomes for these new horses to pull anyone. The faster we head down the new media road, the faster it will become less effective. Just too crowded.
Witness the second report I alluded to earlier. This one from The Direct Marketing Association, entitled Paid Searches Used To Drive Web Traffic Over Sales: DMA Study
Here are some of this report’s findings, based on actual 2009 marketing campaign results…
- E-mail to a house list averaged a 19.47% open rate; a 6.64% click-through rate; a 1.73% conversion rate; with a bounce-back rate of 3.72% and an unsubscribe rate of 0.77%.
- Response rates for direct mail have held steady over the past four years. Letter-sized envelopes, for instance, had a response rate this year of 3.42% for a house list and 1.38% for a prospect list.
- Catalogs had the lowest cost per lead/order of $47.61, just ahead of inserts at $47.69, e-mail at $53.85, and postcards $75.32.
- Outbound telemarketing to prospects had the highest cost per order or lead of $309.25, but it also had the highest response rate from prospects of 6.16%. The highest response rate for a house list was also telephone, at 10.41%.
- Paid search had an average cost per click of $3.79, with a 3.81% conversion rate. The conversion rate (after click) of internet display advertisements was slightly higher at 4.43%.
As you can see, digital marketing techniques really amount to just another medium. Their over all performances are really on par with traditional media, but certainly not exceptional, in responsiveness or in cost per lead or sale. And the time, energy and resources they require to execute are typically well beyond the cost of the “analog” marketing techniques your daddy grew up with. Which begs the question, “Is it worth it?”
Among the report’s conclusions… “Marketers are managing their expectations when it comes to paid search. Nearly half say their primary goal in paying for a paid search campaign is driving traffic to their Web sites, but only three in 10 list generating a direct sale from the click as their principal desired outcome…
“…5% attempt to lure surfers to sign up for a free trial. Getting surfers to sign up for offers, or subscribe to free e-newsletters or consent to receive sales information was cited by 3% each. Another 2% wanted to drive retail traffic, and 5% listed other goals.
“Marketers still view traditional media channels as most likely to drive direct sales. Fifty-five percent expect to close a deal when using a telemarketing campaign, while half anticipate direct mail campaigns to yield sales.”
So the bar is set pretty low for digital media when it comes to generating profitable results, while what we expect from more traditional marketing remains quite high.
You could call it “The Obama Effect” where the new kid on the block is getting all kinds of slack, with few people willing to point out the Emperor’s underwear. (Oh, but if all media were held to the same low standards we’re asking of the new meida.)
Conclusion: Mob psychology is at work with the new media. These people feel some twisted obligation to be involved with the new media now, because “everybody’s doing it.” Sure, they’re cheap. But if they don’t work, what good are they at any price? Yet many companies are devoting whole departments to them. Personally, while I feel guilty about my own miniscule presence in these categories, I don’t believe they’ll ever be the marketing panacea many expect them to be. I’d stay away for the most part. And if you’re going to play, just understand, up-front, you’re going to have to pay.
I suggest you RUN, don’t walk, away from the new media for now. Let others prove their reliability with their money. Now is the time to stick to media that has a proven track record of helping you sell.
THE END
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