If you have purchased furniture, at some point, you’ve probably had to assemble a piece or two on your own.   At first glance, it is looks like an easy process – legs go here, drawer face there, top goes on like so, etc. Sometimes there are even rudimentary instructions.  It is not that hard to assemble it to a point where it is functional.

Once you start using a self assembled piece, you often find that your creation has a few blemishes: it wobbles when you touch it, the drawers a bit misaligned, or the doors may not close all the way.  None fatal defects, but at some point you have to spend time trying to correct the problems and keeping it functioning properly.

The alternative is to buy a piece that is assembled (by someone that does that sort of thing for a living)– it may cost a few bucks more on the front end, it is put together well, everything lines up, and it functions exactly as designed. You can eat on it right away, put stuff inside, and generally enjoy how it complements your room (no worries about the craftsmanship, or intermittent tweaking required).

Compare the above to implementation of a digital music promotion.  To a sponsor (or their agency) assembly looks straightforward. All you need is music and a delivery vehicle right? Pick up the phone, call a label (or at least a music site), dazzle them with marketing acumen, done deal.  Or is it?

Can it be done as described above? Sure with some amount of time and effort. Look closer though, who takes care of the underlying issues like contracting/licensing platform reliability, budgeting, customer service, delivery obstacles, etc.?  Who’ll align the drawers?

The alternative is to partner with a specialist that assembles and executes the digital music programs for a living, handling all ancillary details mentioned above.   Licensing/contracting – check, proven systems in place.  At that point, a marketer doesn’t have to mess with making things fit together snugly; they can focus on other aspects of their business.  How much overall time and effort is saved going this route? How many fewer headaches involved?

Digital music as a promotional incentive can be a powerful tool for a marketer – just make sure that you have someone that can align your drawers for you.

written by Steve \\ tags: Digital Incentives, Digital Music

How did the promotion perform?

Let’s take measurement for digital music download promotion as an example. The first inclination is to jump right to redemption rate as a means test for success when in fact, that is one of the poorest possible metrics on which to judge efectiveness (unless the goal was to influence redemption as much as possible). Take a look at a CNET article that discusses results from a Pepsi-iTunes promotion (theory of “redemption as barometer”?).  Interesting…

What about finding out the result of the campaign from a marketing perspective ever happened to information on performance in market?
- How much extra leverage did Pepsi distributors get in the field as a result?
- Did Pepsi meet their sales targets (Pepsi was the primary sponsor after all, not iTunes)?
- For Pepsi, how far did the iTunes partnership go in effectively re-asserting itself as THE brand that best utilizes music?
- For iTunes, what was the increase in user base for the iTunes music store?

I admit that there is a challenge involved in obtaining answers to the above questions, as parts of the data required may be spread over various parties, none too eager to discuss their results with others. My contention is that in the Pepsi-iTunes promotion specifically, the benefits from that partnership were substantive for everyone involved, even though the redemption rate was what I would classify as modest.

Artificially weighting of something like redemption rate is not a good way to solely judge effectiveness. Let me give you a better example (the names and industries changed to protect the guilty):

A software company gave away music CDs to consumers that purchased multiple software titles. When the promotion was over, the company instructed it’s agency to analyze the promotion by contacting as many participants as possible to determine how many times each one had listened to their CD. That metric, it was determined, would be used to judge whether they would run a similar promotion the following quarter.

Sounds crazy right? the digital equivalent of this happened. last. year.

If I was the software company, I would be more interested in things like:
- Of people buying the software, how many saw the CD offer and chose that brand over a competitor?
- How many incremental software units were the field sales teams able to ship because of this promo? How many displays were they able to get?
- How many people went in to buy one title, and ended up buying more than 1 to get the CD?

With digital content, the redemption rate is much less important than what the incentive did in the market. A better question for a sponsor is whether the  incentive was effective in grabbing attention and creating action.   Better questions lead to better answers, and the better the answers, the better the marketer.

written by Steve \\ tags: Digital Content, Promotion Metrics

I want 13...BILLLLLLLLLION dollars!

Mine is straightforward – take the promotional products industry, and reduce its sales by 70%, or $13.8B. Ok, not the sales exactly, more like the topline number.

According to the Advertising Specialty industry, in 2008 promotional products industry sales were $19.8 …BILLION dollars! I don’t have anything personal against the ASI/PPAI folks, but I question the effectiveness of the marketing spend. Let’s cut to the chase, the interrogation goes like this:
How effective were your (insert promo product here) …flashlights? Do you know who got them? Will you be able to follow up with those consumers? How easy were they to distribute? Did the perceived value of the incentive net incremental sales?

Ouch, these answers can be prickly.

I think that promotional products/incentives have their place, it’s just at the end of the aughts, I think they should be (mostly) digital. Why? Well, digital incentives (for today, let’s call it “content”) have several advantages to physical products: They offer instant gratification, you can track who has them, integrate those consumers into your CRM plan, distribution is simple (by comparison), and by taking advantage of breakage, you can offer consumers a higher perceived value incentive. The thing I really like though is the way that you can engage a consumer in a rich experience, and get them interacting with your brand in a positive manner. Try doing that same calculus with a free hat and get back to me.

So back to my plan…by leveraging digital incentives, the promotional spend becomes more targeted, distribution becomes less expensive (and less worrisome too), and know marketers are able to pass incentives (with higher perceived values) to the consumer. These are substantive benefits, with less waste and lower costs. My idea is not really an evil one; it’s just a wakeup call to marketers and promotional sales folks alike. The digital future is now, embrace it, leverage it, benefit from it. This message is not unique to me alone, check out Tom Foremski’s thoughts on the Internet’s devaluation effect…

World domination can wait until later.

written by Steve \\ tags: Digital Incentives, Promotional Products

In the incentive space, the perceived value spread is crucial. Marketers strive to provide an incentive with a much higher perceived value (than what a consumer has to do to earn the incentive). The higher the spread, the more effective the incentive becomes.

For the last 3-4 years, marketers have dipped into the mobile content space to leverage incentives in their programs. Incentives such as ringtones wallpapers and to degree basic mobile coupons have been used, with varying degrees of success. I like to classify these as Mobile content 1.0. According to research firm SNL Kagan, US ringtone sales peaked in 2007 at $714 million, followed by a 28% decrease in 2008. According to them, advances in technology have made it easier to bypass the traditional download-to-handset method. Extending this pattern out, it is not hard to conclude that mobile content 1.0 is not dead, but it is certainly on the backside of the “perceived value” curve. Point is, this type of mobile content has held some value to a consumer, but as technology moves forward, this perceived value (and related effectiveness as an incentive) is diminishing.

On the flipside though, I think that mobile content as an incentive is just starting to ramp up. As the mobile “phone” phases out, it is replaced by the “phone/media player/internet appliance/computing device”. With this shift, technology advancement makes the term mobile content take on a much broader definition. I call this next generation content mobile content 2.0. Need an example? Consider the explosion of the iPhone “app” market. According to Gartner’s 2009 Mobile device report , iPhone has a 13% market share globally. Impressive share, but based upon the hype surrounding the iPhone application, or “app” market, you would think that considerably more than 1 in 6 consumers have one. The great thing about these “apps” is that they are so diverse and so broad. In addition, the cost to develop is relatively low, especially when compared to the perceived value. Other examples are the wide array of social media applications, streaming content (music and video), casual games, and QR codes (plus a whole lot of GPS-related/geo-coding things that are near mind-blowing).

Over the last few years, consumer mobile phone behavior has had a dramatic impact on marketing (and possibly vice versa). According to my favorite futurist (Gerd Leonhard) and others, in the (near) future, mobile’s influence will dramatically impact everything we do as marketers. My question is, as a marketer, will you continue using mobile incentives to take consumers someplace they have already been? Or are you ready to step into the future and leverage the type of incentives that take consumers where they want to go? I’ve made my value assessment; yours is coming (sooner than you think).

written by Steve \\ tags: Mobile Content, Mobile Incentives