Beware The Short-Term Math

Making predictions about marketing online is a foolish thing to do. So here goes…

If I put my ear close to that little blue cable that connects my computer to the world, I hear the distant rumble of a hundred thousand stampeding direct marketers. I think that offline direct marketers are coming online in great numbers. Quite suddenly, right now.

Two years ago, a few brave direct marketing souls would add their thoughts to online discussion lists and be laughed at. One year ago, the same brave souls would add their thoughts to the same lists, and a few people would listen.

Direct marketing has come slowly to the Net. Which has been a good thing because we’ve had time to understand this whole new environment and adapt our offline experience. Out of this adaptation stage have come concepts like opt-in lists, a dislike of Spam and permission marketing. Online, we’re in a whole new world when it comes to issues such as privacy and the security of our clients’ personal information.

And it’s great.

The more we build on this model of respect and permission, the deeper we can grow our relationships with our prospects and clients, and the higher our response and conversion rates will grow. Let the offline junk mail guys be happy with 2 percent response rates. We’ll take the high road and try for 6 percent and more.

But if I’m right, and a hundred thousand offline direct marketers now smell money online, our still-young, permission-based model may be in for a beating.

What if a thousand online companies employ five thousand offline direct marketers in time for this coming Christmas season? What if the instructions are, “Fellas, you know how to make this happen with paper and stamps. Show us how to do it with bits and bytes.” Will these guys stop to learn about the finer points of opt-in and opt-out? Will they spend the first couple of months learning and adopting what’s new about direct marketing online?

Doubt it.

Meanwhile, us clever experts will be shaking our heads and saying to ourselves, “Ha! Are those boys about to fall flat on their faces or what?!”

Maybe not.

Let’s say I’m preparing for the Christmas season and I adopt the permission-based model for web site ‘A.’ I use some house lists and buy some targeted opt-in lists for my email campaign. I’m going to be as aggressive as I can to get those sales, but not at the expense of the quality of the relationships I’ve been developing.

I email to five hundred thousand people and get a response of 3 percent. The offline guy advises web site ‘B.’ He doesn’t go for this permission stuff. He’s used to mailing high volumes, getting low response rates, and handling irate recipients. It comes with the territory offline. So he emails five million people — whether they want his message or not –and gets a response rate of 0.5 percent.

He beat me. He gets the brass ring. He won the Christmas season. He just added a few tens of millions to that IPO down the road. True, I’m building a long-term asset for my company and he’s not. But not everyone is going to listen to that song. Instant gratification is attractive to many online business models. “I’ve got six million members signed up!” Never mind that only one-tenth of them are active or ever bought anything. Big numbers count.

So. Am I right in my prediction or not?

I think I am — the only question is one of degree. How many offline direct marketers will enter our industry over the next six months — and how many will do the short-term math and start spamming?

Here’s my cautionary suggestion for the day:

What online direct marketers are building has great value and is still young and vulnerable. We need to defend our new direct marketing models, morals and attitudes. We can’t be “nice guys and girls” about this. We must educate our clients and our colleagues professionally and aggressively.

And we don’t need anyone’s permission to get started.