Category Archives: Sales Promotion

The most powerful word in marketing, it’s not a keyword, nor an AdWord…

08 Thursday Mar 2018

Posted by in Branding, Content Marketing, Copywriting, Digital, Digital marketing, Direct Marketing, Marketing, Sales Promotion, social selling, Telemarketing, Thought Leadership

≈ 3 Comments

Tags

, ,

You’ll have probably noticed dear reader, the cancerous spread of fake marketers promoting their thought leadership, has resulted in an increase in the use of adjectives, particularly in headlines.

You see them everywhere. For example, you no longer need normal marketing tools, you need “killer” marketing tools. Or you can download “mind-blowing” secrets for your online success. Don’t you love how these aren’t just secrets, they’re mind-blowing secrets? How mind-blowing is it to sell something to someone who wants to buy it?

The problem with much of this digital dross, is that it rarely focuses on you, the customer – except the spurious claim about blowing your mind. The content is nearly always about the self-centred thought-leading internationally-published super-effluencing, fake marketer and their miracle secret sauce for digital success.

It’s never about you.

And “you” is the most powerful word you can use in your marketing messages.

The “You Rule“ is simple. Always use more of you, your, yours, you’re, you’ve than I, our, ours, us, we, we’re, we’ve, my and mine. People are only interested in one thing – themselves, so write from their point of view, not from yours.

There has always been some debate about whether “you” or “FREE‘ is more powerful.

When I was National Marketing Manager at TNT back in the dim dark 1980’s I ran a split-run test. I wanted to see which was the more powerful word for helping to generate a response.

This was the time in life when fancy digital calculators and branded business card holders, were all the rage as corporate gifts. I’m sure anthropologists in future centuries will just look at marketing incentives to determine a specific time in history. Digital calculators & Business Card Holders = 1980’s. iPods = 2000. USB sticks = 2005. iPads = 2010. Fidget spinners = 2015 and so on.

The test was in a direct mailpack, flogging the first-ever payroll software for desktop computers. It was in the heady days of disruption – when mainframe computers were being replaced by desktop computers. Sorry, that can’t be true – disruption was only invented by cyber hustlers and fake marketers in the last decade.

But I digress.

Heady days they were folks. The mailing had an insert. It promoted the incentive you would be given if you responded for a demonstration of this innovative and disruptive software.

The test was in the headline. We tested two different headlines, but kept the image and copy the same on both inserts.

Headline 1: FREE CALCULATOR

Headline 2: YOUR BONUS FOR TAKING THE INITIATIVE

My experience told me the first headline should get a better result. However, you guessed it, the second headline generated the higher response.

It addresses the reader and implies they’re smart. They’re taking an initiative, not just responding.

Then we combined the headlines for greater impact:

Headline: YOUR BONUS FOR TAKING THE INITIATIVE
Subhead: Complete the enclosed envelope and return it today for your FREE EXECUTIVE BUSINESS CARD HOLDER

I dug it out of the archives:

What an offer dear readers – how could you resist?

We then tested different headlines for some of the other divisions I was marketing. Here they are:

That’s the beauty of testing – you don’t have to decide, the market does it for you.

You have to love that, don’t you…

You think that’s too many you’s?

You’re right…

Chemist Warehouse goes radical to promote annual sale…

24 Wednesday Jan 2018

Posted by in Advertising, BIG DATA, Content Marketing, Customer Service, Digital, Digital marketing, Direct Marketing, Email marketing, Marketing, Sales Promotion

≈ 1 Comment

Tags

, , , , , , ,

As the summer holidays (yes my mates in the northern hemisphere, it’s summer down under) draw to a close, another annual ritual is also winding up.

It’s the annual post-Christmas retail sales. Although many stores started their sales prior to Christmas. This is the busiest time of year for retailers, as they clear stock to get ready for the new season and year ahead.

The major channels used by retailers to generate sales are:

  • Unaddressed mail
  • Direct mail
  • Television
  • Radio
  • Press
  • Email

You’ll notice digital doesn’t rate, apart from email. Broadcast channels aside though, the dominant channel is the letterbox. Unaddressed catalogues and leaflets abound.

One of my favourite catalogues is the Chemist Warehouse custom newspaper. This is a 16-page tabloid newspaper called The House of Wellness. It’s chock-full of information, advertising and promotions, including third party offers.

These types of publications were created in the 1980’s by mail-order marketers. As the publications were a cross between a catalogue and a magazine, they were called a magalogue. Luckily that buzzword didn’t last, though I think I once went to a seminar on how to create successful magalogues?

It’s a very good read. Here are some pages:

Front cover

Double-page spread

Third party offers

Back cover

Chemist Warehouse also uses television and email to promote its brand and sales. Consumers can buy in-store or in the online store. Amazing stuff.

These radical marketing tactics are summed-up simply by the term; common sense. This is known as a multi-channel approach. It’s branding. It’s selling, and it’s adding value to customers.

It’s not omnichannel. It’s not content marketing. It’s not data-driven marketing. It’s not customer engagement. There’s not even a customer journey – apart from driving to the store.

In a nutshell, it’s just plain old common sense marketing – and it works.

So why not start your year with a radical dose of common sense? Avoid the mandatory digital BS and buzzwords. Don’t chase the latest shiny silver digital bullet. Focus on your customers and do the simple things well. You’ll be surprised how successful you’ll be.

P.S. Today’s letterbox has a fabulous bunch of retailers making lots of offers. And there’s also a leaflet from Salmat, looking for people to deliver the catalogues into letterboxes in my street.

I might just take them up on it. Getting paid for a brisk early morning walk plus the opportunity to read marketing messages – it’s a marketer’s dream!

Retailers use innovative response to arrival of Amazon…

07 Thursday Dec 2017

Posted by in Advertising, Branding, Customer Service, Digital, Digital marketing, Direct Marketing, Marketing, Sales, Sales Promotion

≈ Leave a comment

Tags

, , , , , , ,

The arrival of Amazon in Australia has created a bit of a media frenzy. Some of the over-reaction would have you think the world is coming to an end, as Chicken Little believed centuries ago.

Amazon is coming, the end of retail is nigh…

Yet a day after the announcement that Amazon was open for business, some media turned against Amazon. Apparently the prices Amazon is charging for many electronic goods are way more than competitors are offering both in-store and online. Amazon is not the cheapest in many categories.

This is a reflection of how online stores like Amazon are damaging brands by commoditising them and reducing them to compete mainly on price, rather than other differentiators. But that’s another discussion.

However, there is a group of retailers using innovative technology to combat Amazon. Though the cyber-hustlers would claim the retailers have lost their mind. After all, this is the digital world.

These retailers are using printed catalogues delivered directly into letterboxes to generate Christmas sales. Many of them are also advertising on television and radio, as well as in press (inserts and ads).

What are they thinking?

Here are the brands that have reached my family’s letterbox in the last two days:

  • Woolworths
  • Big W
  • Coles
  • IGA
  • Supercheap Auto
  • Repco
  • Priceline Pharmacy
  • Harvey Norman
  • Officeworks
  • Target
  • Bunnings
  • Bing Lee
  • Pillow Talk
  • Zamel’s Jewellers

Retail catalogues in my home…

I wonder, given the whole world has gone 150% digital, why retailers would use the technology that impacts all five senses (print), rather than the technology that only impacts three senses (digital)?

Maybe it’s because online sales in Australia will only be 7.3% of all retail sales this year? Or to put it another way, 92.7% of all retail sales will not be online this year. So digital marketing is the equivalent of playing in the kiddies pool in the big game of marketing.

Maybe it’s because they know that as a result of looking at printed catalogues, people shop online, as well as directly in-store.

Maybe it’s because they know catalogues and inserts work, as they are the secret weapon of digital start-ups.

Maybe it’s because they listen to customers rather than cyber-hustlers when it comes to running a profitable business?

Who knows?

But I gotta go now and do my Christmas shopping – where are my catalogues?

How a simple incentive made me the owner of Rebel the Frenchie…

03 Friday Nov 2017

Posted by in Advertising, Content Marketing, Copywriting, Customer Service, Digital marketing, Direct Marketing, Email marketing, Marketing, Sales Promotion

≈ Leave a comment

Tags

, , ,

If there is one constant in marketing, regardless of media channel or product category, it is this:

A relevant incentive will always pay for itself…

Here’s one of my most recent examples. About three years ago, my young teenage daughter (and her brother) started hounding me (excuse the pun) to get a puppy. “It’s not fair dad, you and mum had dogs when you were kids” they’d use as argument. It was a hard claim to counter.

As we don’t have a side or rear fence, and we back onto a lagoon, I wasn’t keen to get a pet of any kind. We already have ducks, pelicans, water hens and other birds aplenty, as well as Eastern Water Dragons and Blue-tongue lizards. But persist they did.

And my daughter didn’t want just any dog. She wanted a French Bulldog. Now if you don’t know what a French Bulldog looks like, just check Instagram. They are the K9 equivalent of the Kardashians when it comes to followers. Though unlike the Kardashians, these pups reek of cuteness and are amazingly photogenic.

They also happen to cost a small fortune. You could move to France, rent a farm and raise your own litter of pups, for what you pay for one of these bundles of joy in Australia. But I digress.

In her quest to convince me, my daughter bought me a French Bulldog coffee cup, a pug calendar (pugs are almost as cute), even a French Bulldog phone cover. But I stood strong and didn’t wilt under the onslaught, having never been a fan of house dogs.

my new favourite coffee mug…

At the end of first term in 2016 my daughter failed her maths subject terribly – despite my tuition. I think she has her mother’s maths genes – she believes buying something on sale saves you money, versus not buying it at all.

So I gave my daughter an incentive. “If you finish the year with a score of more than 75%, we can get the puppy”. I reckoned I was on a good thing, but you’ve probably already guessed the outcome to this story, dear reader. Here’s part of the text message my daughter sent me in November last year – it’s not easy to argue with facts:

Looks like we’re getting a dog…

So now we have a 12 month old puppy named Rebel, and she believes every piece of furniture is a chew toy. But she’s sooo cute…

As in life, so it is in business – offer your prospects an incentive to do what you want them to do, when you want them to do it, and you’ll increase the number of prospects who do – what you want, that is.

This doesn’t mean flog discounts at every opportunity – just give people an extra reason to act. Here are a few very successful examples to demonstrate the point:

A free pair of slippers for every home loan applicant…

A free drink at the bar for completing a survey about the hotel’s function room…

And who would have thought this would be a successful incentive – a free box of toilet paper and a 30 day free trial?

Earlier this year, my daughter topped her maths class and had the audacity to ask for a second Frenchie. Given I’m the human who most follows Rebel around with a plastic bag scoopin-the-poop, my response was, well let’s just say, it was a tad “disincentivising”.

Time for a nap…

Connect with me anytime: https://www.linkedin.com/in/malcolmauld/

Uber and other startups starting to smell a lot like 1999 – again…

01 Wednesday Jun 2016

Posted by in Advertising, Branding, Digital, Digital marketing, Direct Marketing, Marketing, Media, Sales Promotion

≈ 4 Comments

Tags

, , , , , , , , ,

I was working in New York just prior to the first dot.con collapse. I still recall the chancers and opportunists standing on street corners with suitcases full of business cards. They were literally handing them out to any random passer-by, as the primary way to get traffic to their websites. An early form of geo-targeting by the first generation of digital marketers.

business card

The activity reeked of desperation, but hey, they were heady times. Rich veins of gold were just waiting to be tapped by the dot.con zealots.

I’ve been reminded of those times again recently. It seems the street hustlers who harass you to support a charity, are now competing for sidewalk space with the latest cyber-hustlers selling online retail and App-based services.

Hello Fresh promoters are everywhere. I mentioned them in my last post – they are major users of print distributed by mail, letterbox, inserts and face-to-face (or hand-to-hand as some now call it).

hello

Interestingly, in a few short months Hello Fresh has moved from $30 off your first order to $50 off your first order. That’s not a good trend and indicates a very competitive market with too many suppliers. Watch this space for brand consolidation in the near future. Like 1999, the predictions are that some of these home delivered food brands won’t last.

hello fresh 2

Hello Fresh

And sometimes fate steps in. Just as I was finishing editing this post there was a knock at my door and a charming lady selling Hello Fresh appeared. She even agreed to a photo for my blog. I didn’t become a customer as we are well-stocked for food. But what an innovative channel – knocking on doors to sell things. Did anyone see that digital disruption coming? Well it certainly disrupted dinner.

Hello Fresh door knocker

Helpling also uses printed inserts, brochures in letterboxes and hand-to-hand via street walkers to grow its business. Like all online retailers, they use that amazing digi-breakthrough of giving away a discount with your first purchase. This is a disruptive technique used by marketers for, hmmm, since the beginning of time!

hello 2

helpling

And this week, outside a CBD train station in Sydney, an Uber street walker shoved this in my hand.

Uber 2

Uber 1

Now who in their right-digi-mind would have thought it possible?

The disruptive taxi booking service for the App generation, is resorting to handing out printed leaflets in the streets, with discount offers, to acquire new customers?

What’s really really really really old, is new again – again:)

SP_move-along

And just to clarify other digital myths doing the rounds:

  • Uber is not the world’s biggest taxi service. It’s one of the world’s biggest taxi booking services.
  • Airbnb is not the world’s biggest hotel – it’s one of the biggest accommodation booking services.

But why let the truth get in the way of a good digi-story about the disruption industry? It seems to me, the old quote applies more and more these days – “the more things change, the more they stay the same…”

Though it is ironic that by using fashionable marketing jargon like “disruptive” and disruption” I sound sooo 2016, yet these alleged disruptive brands smell like, umm well, so 1999…

The essential media channel most successful digital start-ups can’t do without…

31 Tuesday May 2016

Posted by in Advertising, Branding, Digital, Digital marketing, Direct Marketing, Marketing, Media, Sales Promotion

≈ 5 Comments

Tags

, , , , , , , , , ,

Here’s a quick quiz for you digital marketing experts:

Question: What do all these online brands have in common?

Google, Uber, Kogan, Catch of the Day, Deals Direct, The Iconic, Hello Fresh, Helpling, styletread, carnextdoor, suppertime, Charles Tyrwhitt, Naked Wines, Virgin Wines, Marley Spoon and loads of other digital retailers…
(Hint: Direct marketers have an unfair advantage here)

Answer: they all rely on print as their most valuable media channel for acquiring new customers.

That’s right folks – print technology. You know, that ancient old-fashioned relic of a media channel, arrogantly ignored by so many naive digital marketers?

inserts

printed inserts are key to new customer acquisition

FYI a quick piece of digital advice – if you are an alleged digital marketing expert who advises clients to only use digital channels, or a digital marketer who only uses digital channels, you may need to rethink what you do. Because if you are not using the proven channels and only using the (often) unproven digital channels, you really should leave the industry. You’re giving it a bad name and costing marketers a sizeable fortune.

I’ve written previously about Google’s use of direct mail. You’ve probably received some of their mailings. So let me share the ParcelPush story with you.

Bjorn Behrendt is a successful German entrepreneur with a background in online direct marketing – also known as digital marketing. He launched styletread, an online shoe store, in Australia. He then sold it for loads of money. Now he’s launched another three digital start-ups in Australia to service digital retailers. And these start-ups are all print-based businesses.

Gotta love it when one of the fastest growing digital start-ups, which exists to service digital start-ups, is providing print services to those digital start-ups!

If you’ve worked in direct marketing, particularly online retail or mail order, you’ll probably already use printed inserts in fulfillment parcels to acquire customers. This channel is at least 50 years old.

But if you don’t have any DM experience this channel might be new to you. Bjorn discovered printed inserts when he owned styletread. Loads of other online retailers asked if they could put their inserts in styletread’s shoe boxes when they were delivered to customers – for a fee of course.

Long story short, Bjorn partnered with Australian Craig Morris and launched ParcelPush – a specialist business owning the rights to access online retailer’s fulfillment boxes/parcels. They pay to insert a branded envelope into them. Then they sell inserts into those envelopes to other online retailers. For example, in the Aussie Farmers Direct fulfillment box, they insert an envelope branded “Aussie Farmers Direct” and it is filled with third party offers and samples.

logo

This has become one of the cheapest channels for online retailers to acquire new customers. After all, they are making offers to people who have already bought a product online, so these prospects don’t need to be educated to shop online. It’s the same process as mail-order companies that used inserts to convert existing mail-order customers to buy other products by mail-order. What’s old is new again – again.

More importantly they are using tactile media – the media that affects all five senses – sight, sound, touch, smell and taste. Digital media only affect sight, sound and touch, so are relatively limited in their customer engagement ability. (I had to get customer engagement into a marketing blog to demonstrate my digi-credibleness). As I’ve said before the physical nearly always outperforms the virtual.

Most digital marketers struggle to make digital channels profitable for customer acquisition. The digital channels are much better for retention and repeat business.

Here are some samples of the inserts – all shapes and sizes:

Parcel Push 2

Parcel Push

In addition, and as a result of the success of ParcelPush, they’ve also launched two other print-based businesses:

www.letterboxpush.com.au – this is a competitor to the Yellow Envelope and other distributors of catalogues and brochures into letterboxes.

www.printpush.com.au – this is an online print business. Who’d have thought we needed another printer? But the ParcelPush print volumes have made it possible to offer good value printing – and distribution.

So if you want to succeed with digital marketing, here’s some career advice. Find a grey-haired direct marketer and buy them a drink. Then sit back and listen. They’ve lived through and created more disruption in marketing than anyone else in history. And they continue to do so. You’ll be surprised how fast your career takes off.

But remember, just because digital marketing techniques are new to you, doesn’t mean they’re new to the world. Technology changes, but human’s emotional reasons for buying remain constant…

Newsagents should be wary of Instagram…

10 Monday Aug 2015

Posted by in Customer Service, Sales Promotion, Social Media

≈ 2 Comments

Tags

, , ,

Those of you who work in fashion will know how powerful Instagram has become as a tool for sales promotions. Of course they’re no longer called sales promotions – for some strange reason everything has been relabeled in the digital world. They now have new digi-names, like social activation event, or customer engagement experience, or content marketing lead magnet, blah, blah, blah.

So yesterday (Sunday morning), my bride and I went to quickly buy a birthday card and gift voucher for a 12 year old boy, before getting into the rest of the day. After getting the card at the newsagent, my bride went to buy the gift voucher at the surf shop, while I went across the mall to get some cash from the ATM. It was team work designed to get back home promptly.

Next door to the bank was a newly opened Tiger Lily store. My bride shouted to me “meet me in the Tiger Lily store – they’re having an opening event today, I saw it on Instagram“. I immediately sensed a trap. Why hadn’t we gone to the usual card shop where we get the funny birthday cards? Thoughts of Ole Lynggaard and Lee Mathews rushed through my mind.

Grabbing the cash from the ATM I ran into the store and straight to the manager. This very polite 20-something smiled beautifully and asked if she could help me – given my panicked state.

store maanger

Store manager with trusty assistant…

I said “this might sound strange, but could you possibly put a ‘sold out’ sign out the front or maybe close the doors with a ‘gone to lunch’ sign, just for a half hour? My bride knows about your promotion from Instagram and is on her way here soon – please help me?”

The women shopping in the store smiled knowingly. The store manager just said “your bride must have impeccable taste“. I said “she does, she married me, but that’s beside the point“. I went to the front door to head off my bride. As she approached I exclaimed the store was sold out, so there was no need to enter. But she was having none of it – she was on a shopping mission and I was doomed.

So I sat on the husband/boyfriend couch at the front of the store and was soon accompanied by another poor bloke. I told him I came shopping for a 12 year old’s birthday card and asked him what he thought he was doing when he left home? He and his partner were dressed in lycra and fitness gear – he thought they were out for a healthy walk. “It explains why she packed her credit card, not a water bottle” he sighed.

“Instagram?” I asked – “Instagram” he nodded.

Husband couch

The husband/boyfriend couch…

My bride tried on a dress. All the women shoppers and the sales staff in the dressing rooms gushed at how wonderful she looked, as they turned their heads to me. It was obviously a conspiracy. What is the collective noun for women shopping in a pack? I dare not guess.

The store manager’s trusty assistant offered me a health drink – beetroot, carrot and some other juice. I suggested single malt would be more appropriate given the circumstances.

Suffice to say we finally left the store with a new dress, new hat (thrown in, given the value of the dress purchase) a free posy of flowers (as we were one of their first customers) and a health drink. And now we’re on their database.

Mal in shock

Still in shock I carry the new hat, posy and health drink – damn expensive birthday card…

It’s no wonder newsagents are struggling – from now on we’re buying birthday cards online. We’ll go broke otherwise…

There’s a half-naked granny on my balcony…

03 Thursday Oct 2013

Posted by in Advertising, Copywriting, Direct Marketing, Sales Promotion

≈ 1 Comment

Tags

, , ,

Last weekend I did something I’ve never done before – held a garage sale. We are renovating next year, so decided to clear out our home and office, as I now work virtually and no longer need the 6 staplers and 3 hole-punches that I’ve kept in storage since we closed the office.

My bride is a big fan of Lee Mathews clothes – so much so, I want to meet Lee’s kids as I’m sure we’ve put them through private school. My bride decided to have her own clearance of said clothing range as part of the sale. We live on the northern beaches of Sydney and Lee is a well known local designer.

To promote the sales event (to quote current automotive jargon – it’s now a sales event, not just a sale) I used a combination of letterbox drop, classified ads in the local paper, email to contacts and street posters nailed to telegraph poles at 5am on the day.

Get your Lee Mathews here...

Get your Lee Mathews here…

We started our day at 4.15am thanks to a damn exotic screaming bird in the neighbour’s tree opposite. Though it was a blessing in disguise as we had so much stuff to organise. The professional garage sale trawlers started arriving at 6.45am. Apparently tradie’s tools are in hot demand, as they get stolen so much.

My street posters used a number of headlines – two included Lee Mathews as the first words. I put a number up in both directions on the main road leading to our home. Being the good marketer I asked people if they had seen our ad in the local paper or the street posters.

Most hadn’t seen the ad, but they had seen our street posters and of course our neighbours saw the letterbox leaflet, because they told us so. A number of women turned up for the Lee Mathews clothes and then rang girlfriends to let them know – nothing like a bit of real-time social media.

It turned into a community event, as some of the local kids set up a fresh lemonade and muffin stand out front. Neighbours dropped in for a chat and there was lots of negotiating as everything from kids games to surfboards, fridges, clothes, books and other stuff changed hands. Though I still have all the office furniture.

The day was long though, particularly as for some strange reason we invited friends to come for dinner that evening. So we had to close down the sales event, pack up the leftovers, remove the posters and then go shopping for dinner. I offered our guests a free stapler but they weren’t interested.

Early Sunday morning, in much pain from all the lifting and carrying the previous day, not to mention the wine over dinner, I was making breakfast. I heard some noise out the front and went to investigate. To my surprise there was a half-naked granny on the balcony trying on the remaining Lee Mathews dresses.

I apologised for spying her in her bra and she apologised back for interrupting our morning. Apparently she only just read the classified ad and was worried she’d missed the sales event! The long tail of classified advertising had prevailed.

So I made her coffee while she used our front window as a mirror, completely oblivious to the rest of the world. Barb’s her name and she is quite the character, as well as a grandmother of 10. I’m suspecting she was possibly a hippie in her day. She was in great physical shape and that’s all I’ll say on that.

Granny coffee mug

My bride helped her try on clothes and after almost an hour she walked away with a bargain, as these were the clothes that didn’t sell, so were going to charity.

As a single bloke I probably dreamed of waking up and finding strange half-clad women on my balcony. I never thought it would be a cool grandmother on her way to Sunday church.

Maybe we shouldn’t donate those clothes just yet? Where are those street posters?

Look at me, look at me…

08 Wednesday May 2013

Posted by in Branding, Sales Promotion, Social Media

≈ Leave a comment

Ever wondered why people become fans or followers of brands on Facebook or Twitter?

Boston market research group CMB asked the question. They publish regular reports about various aspects of marketing you can download.

Think about the context as well. They asked people who had clicked they were a fan or follower ‘why’?

This slide demonstrates that more people who are already customers say they are more likely to buy after becoming a fan or follower. What else would they say given they had clicked the fan/follower link?

Fans or more likely to buy - duh!

Fans or more likely to buy – duh!

This slide reveals the majority of people who do follow or become a fan only have time to follow less than 5 brands. This is not surprising – we all have real lives that don’t revolve around building click-relations with brands.

75% of females follow less than 5 brands

75% of females follow less than 5 brands

The majority of those who become fans (or should that be Fans with a capital “F”?) do so because they are already customers – which was probably predictable anyway.

It's about me the customer

It’s about me the customer

Interestingly the primary reason people become FB fans is “to receive discounts”. So we’re encouraging the people who are already customers to register to receive discounts on stuff they are already buying? Is that smart marketing?

Existing customers who want discounts

Existing customers who want discounts

The main reasons people Follow tweets is because they are a customer, followed closely by “to receive discounts”. Do you see a pattern here?

I'm a customer, give me discounts...

I’m a customer, give me discounts…

But the Primary reason for becoming a Follower on Twitter is “to receive discounts and promotions”.

Give me discounts, I want discounts...

Give me discounts, I want discounts…

What is all this data revealing about brand Fans and Followers?

Well for one thing it’s not about the brands.

It’s all about the customers – look at me, look at me. Look what I’m clicking on. How can I get deals and discounts by doing so?

Running perpetual sales promotions and discounting your products and services to your most valuable customers are guaranteed ways to go broke. And they’re certainly not a smart way to invest your marketing budget.

But hey, I’m confident your shareholders would rather you have lots of fans and followers than lots of profit.

I’m planning a home renovation – better go follow some roofers and tile grouters and builders to see what discounts I can get.

Never underestimate the customer…

12 Thursday Apr 2012

Posted by in Customer Service, Group Buying, Sales Promotion

≈ 1 Comment

It seems my last post about the death of group buying is being supported by evidence elsewhere – see this article from the Sydney Morning Herald: http://tiny.cc/e0bocw

Group buying is another reflection of herd mentality, which is in our DNA. Just look at the reaction of young teenage girls to manufactured boy bands when the ‘band’ arrives on your shores.

And it is herd mentality – or the desire to part of a group – that influences a lot of consumer behaviour. Facebook is a recent example. But if you have ever run a retail business or any type of business where you deal face-to-face with customers, you know to always expect the unexpected from those customers.

When my family owned a supermarket on Sydney’s north shore, Thursday night was known as late-night-shopping night, because stores were only allowed to open late on Thursday evenings – until 9pm. Nowadays the rules are slightly different.

Thursday was also the day (as mentioned in my previous post) when all retailers advertised their loss leader products to try to attract more customers to their stores.

I’ll not forget a particular evening. I was operating one check-out (probably a vision you’d not planned to have today) and my mother was operating the other one.

Every week, like clockwork, a particular lady would come into the store with the tear sheet of specials that were advertised in the metropolitan newspaper. On this particular day tins of pinapple pieces was reduced from $0.54 to $0.49 – a saving of 5 cents. There was a limit of 4 tins per customer.

For some reason we had been able to buy the brand of pinapple pieces on offer for less than usual  wholesale price, so our normal retail price was $0.48 – this meant our standard retail price was cheaper than the advertised special price.

The ‘customer’ arrived at the checkout with her basket full of specials, each at the limit of the number of items she was allowed. She never bought anything else but the specials.

As she placed the tins of pinapples on the checkout counter, she exclaimed “these are on special”. To which my mother replied, they are advertised as a special but our normal price is 1 cent cheaper than the special price.

The confused customer asked for clarification and my mother again explained that as our normal price was cheaper than the special price the customer would be saving an extra one cent on the advertised price.

The customer then exclaimed “so I’m not saving anything from you on your normal price?” to which we confirmed “no”. So she promtly said “well I’ll not have the pineapple then” paid for her other specials and walked out the door.

She believed that if she was getting a ‘deal’ on our normal price then she wasn’t going to buy the goods.

This is the type of mentality that exists in the people taking up group buying deals. Last weekend I was at a lunch where two couples were organising a dinner, but only if they could get it through a group buying deal. They didn’t want to go out together at full cost.

Like I say “never underestimate the punter”. The deals they buy are all about themselves, not about the retailer supplying the offers. The punters don’t care if they never go back to the retailer, unless it’s at half price.

Eventually the retailers and other businesses making the group buying offers, will realise thay don’t have to outsource their sales promotions to a profit-making group buying mob. After all, the group buying mob is in it for themselves too – not for the small business that use their group buying ‘service’.

If a business wants to give away 50% of the price to attract new customers, they can do it themselves, via their own lists (email and mail), local advertising, letterbox, search engine marketing and other proven channels, even social media. At least they can capture the details of those who take up the offer and not rely on collecting their money from a third party.

Buy hey, these are proven channels so why use them? It’s much more fun and far cooler to use the magical new wonders of “the internet” regardless of whether it’s profitable or not – after all, everyone’s doing it and we all want to belong to a group, don’t we???