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SMS: The Only Effective Digital Communication Channel?

26 Jul

In 2012, we’re living in an era of ignorable information.

According to a study by Mogreet, 88% of emails are never opened, 84% of Facebook news feed items aren’t viewed, and 71% of tweets are ignored. But there is one digital communication channel that almost always gets attention: SMS. An amazing 98% of SMS and MMS messages are opened and read by recipients.

Here are some other interesting statistics on SMS:

– There are 234 million mobile device users in the U.S. with access to SMS capabilities vs. 161 million Facebook users, 28 million Google+ users, and 18.7 million Pinterest users.

– 174 million Americans text daily. That’s 74% of people with mobile devices. In comparison, 91 million people use Facebook daily (57% of users) and just 2.8 million use Pinterest daily (15% of users).

– Every day, 6.4 billion text messages are sent in the U.S. During the same period of time, 3.2B Facebook “Likes” are awarded and 300M new Facebook photos are uploaded.

– While 58% of users login to Facebook daily and 57% of people check email fewer than 4 times per day, mobile phone users look at their phone an incredible average of 150 times per day. That’s roughly every 7 minutes during waking hours.

For marketers, the prominence of SMS shouldn’t be ignored. While the rules for sending SMS are very different than for other communication channels, SMS and other phone application notification methods are an increasingly important communication channel. While these statistics focus on SMS messages, other application-specific notifications are equally as effective at delivering messages and updates to mobile phone users.

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Do Great Consumer Products Market Themselves?

18 Jul

Spotify. Dropbox. Foursquare. Instagram. Facebook. Flipboard. Pinterest. Twitter.

Everyone knows these insanely popular companies even though they’ve invested almost nothing in advertising. In each case, they built a strong brand by building a great product or service and letting their customers spread the word.

With their success, a new generation of entrepreneurs are rethinking their approach to marketing. It’s increasingly common to hear luminaries talk about marketing as a weakness: the notion that only weak products require marketing.

So, is it true? Do great consumer products market themselves?

Here are a few thoughts:

  • Marketing isn’t advertising: Too often, I hear smart people talk about marketing as if it is only advertising. Advertising is just one way to build a business. There is so much more to marketing: product management, design of referral programs, visual identity, messaging, competitive analysis, collection of customer feedback and ideas, choosing new markets and segments to target, picking company / product / service names, building awareness through savvy PR and promotion, etc. While companies with great products may not need advertising, marketing often plays an important role in the rapid growth of product awareness and usage.
  • Very few products sell themselves: What almost all of the companies featured at the beginning of this post have in common is that they are free Internet services that appeal to a mass market population. While it takes real work to get people to try a free site, application, or service, the barriers to broad adoption are much lower. Products that almost never sell themselves include things that cost money, enterprise products of all types, and niche products that require more work to find first-time buyers and where it is harder to build the powerful cyclone of hype that benefitted almost all of the companies listed above.
  • Media attention matters: There are many companies that have built great products and still remained obscure. What makes the companies featured here special is that they have benefitted enormously from media attention. They all drove frenzied levels of media hype before they even had revenue. While some of this stems from great products and strong growth, much of it comes from thoughtful media strategy, direct press engagement, and charismatic founders who are trained to tell a powerful story.

 

So, if you have the right kind of great free product, what can marketing do to drive such insane levels of adoption?

Here are a few general principles for marketing a great consumer product:

  • Make sure the consumer experience is awesome: Create mechanisms to understand the user experience, to get constant feedback, and to solicit ideas so that the product keeps getting better and better.
  • Make sure your message is clear: Make sure that the messages about your company, your product or service, the problems that you solve, and the experience of being a customer are clear, consistent, and compelling. Make sure that everyone in your company can tell the same great story.
  • Keep customers coming back for more: Create the right experience for every customer to drive engagement, up sell to paid versions (if that is your model), and minimize churn and abandonment. Measure all of these things and look at the impact of every change on the metrics that matter.

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HBR: Customer Interactions Don’t Build Brand Loyalty

31 May

Harvard Business Review published a fascinating piece on the myths of customer engagement. The report, based on a study of more than 7,000 consumers, focuses on three common mistakes: assuming that consumers want a brand relationship, assuming that interactions build loyalty, and assuming that customer stickiness is correlated with the quantity of marketing interactions.

The consumer-focused analysis included three powerful observations that will be useful to any marketer:

(1) Consumers and marketers think about brand relationships very differently.  According to the report, “only 23% of the consumers in our study said they have a relationship with a brand. In the typical consumer’s view of the world, relationships are reserved for friends, family and colleagues. That’s why, when you ask the 77% of consumers who don’t have relationships with brands to explain why, you get comments like “It’s just a brand, not a member of my family.” (What consumers really want when they interact with brands online is to get discounts).”

(2) Your purpose, and not your frequency of interaction, will determine brand loyalty. The core insight is that brand relationships are built on shared values. “Of the consumers in our study who said they have a brand relationship, 64% cited shared values as the primary reason. That’s far and away the largest driver. Meanwhile, only 13% cited frequent interactions with the brand as a reason for having a relationship.”

(3) Too many marketers over-market in an attempt to drive engagement. According to the report, “there’s no correlation between interactions with a customer and the likelihood that he or she will be “sticky” (go through with an intended purchase, purchase again, and recommend).” There is, however, a significant risk that over-marketing, especially using email, will result in a negative customer experience.

While these are great rules for consumer marketing, it’s interesting to think about how they might apply to business-to-business relationships. The most important difference is that many B2B relationships (but not all) are built on a personal relationship between a sales person or account manager or support person and the end customer. For these sorts of businesses, the personal relationship is an important part of the brand relationship and the quantity of interactions likely does correlate with customer loyalty. But the other rules likely apply without alteration: purpose and shared-values form the foundation of any brand relationship and all marketers, B2B or B2C, need focus on the quality and not the quantity of interactions if they intend to impact brand loyalty.

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