Wake Up Call

Posted on by Chief Marketer Staff

Don’t get so smug the next time you have a good promotional idea. Chances are consumers won’t get it.

A new survey by research firm IMI International reveals that 60% of all promotions result in “insufficient awareness or comprehension,” and that they fail to change attitudes or behavior — a sobering figure for an industry that shelled out $342.2 billion last year to do just that.

Worse yet, consumers indicated that 41% of all marketing campaigns “should never have been launched.”

It’s not all bad news. Of the people surveyed, 69% actively participate in promotions, and 88% are searching for them more than they did last year.

These folks not only want added value, “they expect it,” says Dan Dodson, president of Mastermind Marketing, Atlanta.

But are they getting it? That’s not as clear.

Of the consumers surveyed in the U.S., 51% purchased an item due to a promotion in the three months prior to the survey.

That may sound pretty good, but the figure is 89% for France, 84% for Ireland, 82% for the U.K. and 70% for Germany.

The problem? U.S. consumers need flashier, more attention-grabbing campaigns to engage them than they did before, experts say.

Some brands have reacted by super-sizing prize offerings, such as McDonald’s biggest Monopoly game purse featuring a $5 million grand prize. And others are “creating giveaways and promotions that don’t relate to the brand and consumers don’t understand why they’re doing it,” Dodson says.

And who comes up with these dumb ideas? If you believe IMI, it’s certainly not the agencies. Of 7,000 consumer offers studied by the firm, the five worst came from senior executives of the clients.

“Sometimes people in the client organization believe they’re the expert,” Dodson explains. “They base their expertise on what they personally like or don’t like, rather than what the target audience likes or doesn’t like.”

It may be that firms lack “a means to objectively evaluate the potential of marketing and brand activation ideas before they come to market,” Don Mayo, managing partner, IMI, adds.

How do consumers like to get promotional messages? A whopping 89% like to get them online. This was followed by in-store (47%), direct mail (33%), phone (25%) and text/SMS (6%). Respondents could choose more than one medium.

Does that mean you should pick one over the other? Hardly.

“If 89% of all people prefer to go sailing in a boat more than riding in a car, does that mean you should run out and trade in your car for a sailboat?” asks Alex Campbell, CEO of Vibes Media. “No. They’re both means of transportation but they do fundamentally different things.”

Meanwhile, consumer participation in SMS- and text-based promotions has risen by 7% this year when the area is broken out, according to the survey.

“Not only are consumers preferring to start a dialogue by texting, but they have shown their desire to continue and interact via text for an extended period of time,” says Campbell.

And what prompts consumers to respond? The combined event/sampling category scores highest, at 52%. It is trailed by TV ads (24%), instant win promotions (20%) and national sponsorships (4%).

Wake-up Call

Posted on by Chief Marketer Staff

As the ISPs filed their suits under Can Spam, Ken Hirschman, vice president and general counsel at e-mail marketing firm Digital Impact Inc. in San Mateo, CA, provided a legal perspective.

DIRECT: Will the lawsuits filed by the Internet service providers go a distance toward stopping spam, or are they just a Band-Aid?

HIRSCHMAN: I think the lawsuits can help stop spam. They’ll scare people out of spamming. They’ll be a wake-up call. But the law is only one part of this. Technology has to play a major role in stopping spam. Ultimately, with technology, there will not be a need to engage in this type of lawsuit. DIRECT: Many of the defendants named in the lawsuits are identified as John Doe and have yet to be found. How effective can a law be if there are no defendants to be found or if they’re overseas?

HIRSCHMAN: The ISPs know the technology better than everyone else and are the best minds in the business at tracking people down. If the spammers are overseas, you can’t extradite them as part of a civil suit and even if you win a default judgment, unless they have assets here, you can’t stop them.

DIRECT: What does the fact that the ISPs are exercising their private right of action under Can Spam say about the effectiveness of the law?

HIRSCHMAN: If the goal of the law is to cause interested parties to bring lawsuits against offenders, the law is very effective. If the goal is for these types of lawsuits to scare people out of engaging in spam, that remains to be seen.

DIRECT: What is the legal underpinning of the ISPs’ stance?

HIRSCHMAN: The ISPs have a harder cause of action to win than the state attorneys general or the FTC. Also, the higher penalties go to the government. The state AGs can get $250 per violation under Can Spam. The FTC can get $11,000 per violation under the FTC Act. Under Can Spam, the ISPs can only get $100 per violation for header and subject-line violations. For not honoring the required disclosures, stating that it’s a commercial e-mail, including a valid postal address and an unsubscribe request, the ISPs only get $25 per violation. But there’s still a sufficient enough volume of spam that the ISPs can still get a lot of money.

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