Tag Archives: marketing

Offline marketing of online services

Using snail-mail for marketing is an effective strategy for it grabs more of your attention. But messages need to be more personalised to have effect.

This came in the mail yesterday. If you are an old-timer like me, you will recognise it as an “inland letter card”. The edges are frayed because it had been so long since I’d received one such card that I’ve forgotten how to open them.

bigbasket

You will notice that this inland letter came from Bigbasket, the online grocery shopping firm.¬†At first look, it is bizarre that an e-commerce firm is using snail mail for its marketing. On second thoughts, though, it isn’t that bizarre!

The thing with online modes of communication such as email or SMS is that the cost of sending a message is low, very close to zero. What this leads marketers to do is to bombard you with messages. For example, I bought something from Jabong a couple of weeks back and they’ve since sent me at least an SMS a day. I promptly delete them without reading. On my email, I’ve been unsubscribing wherever possible from promotional lists from which I get messages – for they are too frequent and too “vanilla” (it’s bizarre that even marketers who know much about me refuse to use that information in their communication).

In short, there is too much clutter in online (email/SMS) marketing, and the chances of any promotion really standing out and getting the user’s attention is minuscule.

Sending snail-mail, on the other hand, is expensive. It costs you to buy the paper, print out the letters and then you pay for postage. This means that with the advent of cheaper means of communication, most marketers have moved away from it. What that has done is that you get much lesser snail-mail than you used to a few years ago. Which means that the amount of attention you devote to each snail-mail is actually more!

So with snail-mail being the more expensive form of marketing, it is actually more effective for marketers because it draws your attention! (You can think of it as a multi-player prisoner’s dilemma where the marketer wants to maximise her claim on your attention (relative to her costs), and can do so by either using email or snail-mail. The optimal solution, I believe, is a kind of “mixed strategy” – mostly email, but the odd snail-mail here!)

So an online sales company reaching out to you by snail mail is not that bizarre after all. If only they had customised the mail to put my name on it (not hard to do at all), and made it seem like a personal letter, it would have been even more effective!

There have been two occasions in the last five years when I’ve actually responded to upsell campaigns. One was by Airtel who called and offered me a 3G data plan for almost the same price as what I was then paying for my 2G plan. I had been intending to upgrade and I took it.

The other was by Tata Sky, who sent me a beautifully crafted personalised letter printed on thick A4 paper, indicating I was a “premium subscriber” and asking if I wanted to upgrade to Tata Sky+ HD, and giving me a number of a dedicated call center who I had to call to upgrade. It is likely that had it been email I might have discarded it (or if I were using today’s Inbox, marked it as “Done”). Snail mail drew more attention, and the personalisation made me feel good. And I upgraded.

Teaching marketing

Recently, the Alumni Association of IIM Bangalore had invited alumni to give interviewing practice to second year students at the institute. This was in an attempt to help them prepare for their “final” placements that are coming up in March. With a view towards brushing up my interviewing skills (haven’t interviewed anyone for close to three years now) and also to check out the kind of people that go to IIM nowadays I decided to volunteer. And ended up interviewing some five or six people.

I had told the organizers that I’d be interviewing for a hypothetical job in my firm and that they should preferably send students with an inclination for “quant” and for consulting. Perhaps there was a mismatch in communication, and perhaps I sent my “requirements” too late, but it so happened that at least half the people who came to were “majoring” in marketing (nowadays they’ve introduced the “major-minor” system at IIMB. If you do five electives from one “area” you “major” in that. Three electives from an “area” gets you a minor. There is no compulsion to either major or minor, though).

Given that the questions that I’d prepared were inclined towards interviewing for a quant/consulting/analytics kind of role (basically whatever I currently do in my “job”), I decided to not veer too far from that while teaching these people. To each of them I put forth a “case”, where the central problem was marketing-related but needed numbers to “solve”. In fact, I made up the case on the spot after one of these students told me he had interned at an e-commerce firm.

So I told them that they are the marketing manager of an e-commerce firm and the firm has launched a few advertising campaigns and now needs to test the effectiveness of such campaigns. I asked them how they would measure this.

Given that they might have just about started off practicing for their placements, I realized they didn’t have much expertise doing “case interviews”, and so tried to help them navigate the case. So for each of them I started by asking them what kind of metric they would use for measuring the effectiveness of the campaigns. And this is the stage that each of their “interviews” came unstuck.

Incredibly, each of them independently started off with “we will first understand what segment this campaign is targeted at”. And then their process of measurement involved identifying a sample of customers of this segment and then “measuring if they had got the intended message of the campaign”. When I told each of them that they weren’t allowed to do a survey, and added for good measure that a focus group discussion is also out of question, they all seemed absolutely lost. I couldn’t really proceed with their cases.

I find it incredible that the three of them (granted – small sample) who are second year students in one of India’s better business schools (at least I hope so) completely failed to imagine that the effectiveness of an advertising campaign can be measured in terms of “sales” or “website hits” or “click through rate” (depending upon the “intended message” of the campaign, one of these becomes the appropriate metric). It seemed to me that their management education had clouded their ability to think intuitively.

In my limited experience in interacting with marketers, I’ve found that a large number of them are fairly resistant to using numbers in their business, and speak in terms not fathomable to the common man (I once made the mistake of applying to a marketing analytics firm, and was promptly sent some questions about measurement of “brand feeling” and such like. I withdrew my application). The impression I get from my small sample is that marketers’ way of thinking is completely divorced from that of other people in business, and have always wondered about why this is. I had assumed it might be a function of getting ingrained into certain marketing jobs, but now it seems like this way of thinking is more deep-rooted.

I was taught core marketing by a somnolent professor who was renowned to be a “great marketer”. He clearly didn’t market marketing too well, for I didn’t take any marketing electives after that. However, I think I “get” related fields such as game theory and behavioural economics, and try to understand marketing using those frameworks. Usually it doesn’t take you too far in a conversation with marketers, though.

Based on my interactions with the three marketing major students I interviewed, it seems to me that something is wrong with marketing teaching, especially at IIMB. It seems to me that marketing is taught as a rule-based discipline, rather than based on first principles. Perhaps that is how recruiters of marketing majors want it to be like, but it seems like this kind of “education” is only going to create poor quality marketers.

PS: I admit to small sample bias, extrapolation and such like.