Directed Advertising Relationship Marketing

Direct Marketing yes, Direct to Consumer (DTC) no!

Direct To Consumer (DTC) prescription drug ads don’t work according to an article this morning in the Washington Post. The Post reported on a five year study of Direct to Consumer advertising by prescription drug companies which concluded that those ads had little impact on sales. The study was pretty clever — it looked at Canadians who were exposed to US ads in English, and used French-speakers in Quebec as the control group. DTC advertising is illegal in Canada (According to the Post, only the US and New Zealand allow it), but English speaking Canadians are exposed to the ads through US media. They looked at 3 prescription drugs:  Enbrel, for rheumatoid arthritis, Nasonex for nasal allergies, and Zelnorm, for irritable bowel syndrome. In the first two there was no difference in patterns. In the third, after an initial spike, usage leveled off between the two groups. The Post article quotes a Harvard Med School professor and principal investigator in the study, Steven Soumerai:  ‘Advertising prescription drugs is “not line popcorn, cereal and hair sprays.”‘

I agree with Professor Soumerai, and this study makes sense to me. The study tests the impact of Direct To Consumer TV and print advertising, the ultimate shotgun approach to interruptive advertising. Shout your message out to the widest possible audience (in this case, so loudly they hear you all the way in Canada!). Then hope that some percentage of them are your targets.

Even worse, no matter how loud you do shout, people eventually start tuning you out. This article about consumer recall of prescription drug ads in AdWeek says that over the last year, Nielsen IAG has determined that those ads are getting less memorable. The article places the blame on slashed budgets, stale creative and other woes, and says that those that remain wouldn’t have made the top 10 based on last year’s recall scores.

My agency doesn’t do any pharmaceutical advertising, but in 2006 we did do a direct mail customer acquisition campaign for a legitimate nutritional supplement (for joint pain) that happened to target a similar group to one of the drugs. We had an overall response/conversion rate of 0.75% and our best cells had response/conversion rates as high as 1.81%. (For response rate here, we mean paid product trial, but since it represents an actual order, I’m equating it to a conversion rate as well. For you internet-only types, direct mail response is different than a click thru, since by definition it actually means an order!) We had a first refill rate of 16.82%, meaning 16.82% of those initial customers ordered a second time. Of those, 68.1% became long term customers, ordering over and over. In other words, our direct mail worked to drive increased sales where big pharma’s DTC seemingly did not.

Why? Because we applied solid direct marketing principals to our client’s product. We found the right groups of people, people who through a variety of means told us they were interested in what we had to offer. We tested the lists, the offers and the messages to find the right mix, and then maximized our learning to achieve solid results. This is why direct marketing often succeeds where other forms of advertising fail, and works especially well for companies with smaller budgets that have to work harder.

Since 1997, when the FDA began allowing DTC advertising, the pharmaceutical companies have thrown a ton of money at consumers — $5 Billion in 2006 alone, again according to the Post. Now, to be fair, some of it has also gone to direct marketing in one form or another. Pharma has been a pioneer in building online communities, providing information and educational resources online, all in an effort to get consumers to request their drugs from their doctors. But as we all know from watching TV, much of it has gone into the airwaves. (I can hear that darn Antonio Banderas sounding Nasonex bee buzzing around as I write this. Oh wait, according to Wikipedia, it is Antonio Banderas!)

So in the face of dwindling budgets, shrinking attention and studies like these, can someone please explain to me why big pharma continues to throw billions of dollars at consumers by trying to interrupt them when it could spend far less just connecting with them?

Directed Advertising

Are you passing the test?

In Fareed Zakaria’s current bestseller, “The Post-American World,” one of the conclusions he reaches about the American education system compared to that of other nations is that “Other educational systems teach you to take tests; the American system teaches you to think.”

This got me thinking about testing, that critical component of successful direct marketing. Thinking and testing come together in direct marketing. We think, then we test. Then we leverage what we learned to maximize our results.

I started in mail order, and I currently work at a direct marketing agency called Tanen Directed Advertising, where we bring direct marketing disciplines to everything we do. Or at least we try to. Sometimes clients say the budgets aren’t there for testing. Sometimes the universes are so small there’s no point — there’s not enough there to be confident that the results mean what we think they mean, or to leverage whatever we might learn from the test, and the incremental cost of splitting up the universe and printing or creating multiple versions is prohibitive.

But it hurts me not to test. A couple of years ago, at AdTech NY, I heard Roy de Souza, CEO of ZEDO,  an internet e-commerce and ad-serving tech company, share this piece of advice about testing: “2 with one difference.” Roy said that if you buy 2 search ads and change one single item between them, they will
never perform the same.

I think that holds true for just about anything.

The Vice President of Marketing for Trump University is a friend of mine, Josef Katz.  He’s the Marketing Maestro who writes the TrumpUniversity Marketing Blog, and he was recently interviewed by eM+C magazine. Along with discussing behavioral advertising and social marketing, Josef talks about how he used multivariate testing of an event registration page to increase conversion by over 75%. 75%! The biggest factor in the increase:  moving the registration form below the fold. He said the move allows visitors to read more about the event’s content before signing up. Before the move, they were still clicking but converting at a lower rate.

A guaranteed winner. Huge increases in conversions. What’s not to like about testing?

And yet, some people don’t like testing. I remember a former client of mine who wouldn’t go with our proposed testing matrix, and said, “I don’t need to test. I go with my gut.” To which I replied, “I go with my gut, too. I just test it, along with whatever else makes sense.”

By now you’re probably starting to wonder, “where’s the question, Jeff?” Well, here it is. There are plenty of people out there on both the client side and the agency side that never test, that look down on direct marketing as somehow less important than “real advertising.” That are more than happy to throw money at events that can’t be tracked to sales, ads that can’t find their targets, and imprinted premiums like pens and flash drives that don’t work very well as ads and, in a short amount of time, stop working altogether.

So can someone who doesn’t believe in testing please explain to me why, in this day and age when testing is so easy, are you failing to test everything that can be tested?

Directed Advertising Integrated Marketing

Why are consumers like Western Lowland Gorillas?

CNN had a story today about the discovery of a colony of 125,000 Western Lowland Gorillas, well over twice the previously estimated worldwide population of 50,000. Naturalists had searched in vain for the vanishing primate, growing increasingly pessimistic, until researchers from the WIldlife Conservation Society stumbled upon a huge population in a swamp forest in the Republic of Congo.

I couldn’t help but compare this to marketers who have been lamenting recently that its harder to find consumers than ever before. First, there was the mystery of the missing 18-34 males, who traded in their TV for video games and the internet.

Now it’s white, educated, affluent women aged 25-44. They’re going online to watch episodes of broadcast TV, according to a recent study by IMMI reported on

Newspapers are losing readers, while blogs like the are getting more readers than The NY Times. (The Huffington Post claims 5.7 million readers, while the Times claims a total circ of 1,476,400 for their Sunday edition, their biggest day, including their electronic edition.)

But it’s not that consumers are going extinct. Or even that they’re getting harder to find. It’s just that they’re not in the places marketers are used to looking for them. Kind of like the gorillas.

In the same way I’m heartened by the article about the gorillas, I’m thrilled by the recent Communications Industry Forecast written about in USA Today. For the first time ever, by 2012 direct marketing spending via Internet Service Providers, video games and cable and TV providers is predicted to surpass traditional media. And direct marketing is much broader than it used to be, encompassing everything from behaviorally targeted interactive advertising to opt-in SMS campaigns to paid search to emails to digitally customized, personalized mailers to PURLs.

More and more marketers are waking up to the fact that “mainstream advertising” is failing to find the gorillas in the mist, and direct marketing is a more successful strategy for reaching them… even if it means slogging through a data-drenched swamp to get there.

So can someone please explain to me why so many marketers are still looking for consumers where they used to be, instead of finding them where they are?

Directed Advertising

Something Is Rotten in Darien

I passed a sign the other day for the “Darien Days Carnival: Some Fun for Everyone.” I saw the sign quickly, so when I got home I looked it up just to make sure it actually said what I thought I read.

Yup. “Some Fun for Everyone.” (Read this article from the Darien News -Review if you need some confirmation yourself.)

Why the word “some?”

Is there some small amount of fun for each person who dallies at Darien Days, but not a lot of fun? Will each person find some single thing they enjoy, but not many things?

Or is “some” used as a superlative, like “That was some game!” or “You got you some mad Texas-Hold ’em skills there, Old Son!”

Or maybe, just maybe, in this era of super-sized-superlatives, somebody in Darien was just exercising some much-needed restraint.

I can’t help but be reminded of a favorite line from a favorite book, Richard Bach’s Illusions, that goes something like this: “Argue for your limitations, and sure enough, they’re yours.”

I think it’s far more likely that the slogan for Darien Days was created by a committee of some kind.

I can come up with some more reasons if I put my mind to it, but a man’s got to know his limitations, and I’m approaching mine.

So can someone please explain to me why somebody felt the need to put something extra into the Darien Days carnival theme line?

Directed Advertising

I hope the U.S. Army aims better with guns than billboards

There’s a billboard off the northbound side of Rt 95 near Stamford, Connecticut advertising Army Football tickets. Why? Of all the places you could put a billboard for Army football tickets, why there?

I’d like to believe that there’s a reason. That research showed that a high percentage of West Point Military Academy alumni or people otherwise predisposed to buy Army football tickets drive by that very spot on a daily basis. Maybe it’s a guerrilla marketing play, and it’s there just to catch the attention of a single alumnus, now a military contractor, who buys tickets by the truckload to give out to legislators. Or maybe it’s just there to stick it to Navy, with the submarine base just up the road in Groton.

West Point isn’t the only college I’ve seen that’s advertised on billboards in strange places. I’ve seen college recruitment billboards for out of state schools on the New Jersey Turnpike. I can’t remember the school because it made such little sense. But again, I’d like to believe that there’s a reason. That a worthwhile portion of applicants to the school actually come from New Jersey. Or that a significant portion of a rival schools applicants come from New Jersey, and our school wanted to steal market share.

The alternative is just too grim to think about: that some agency (or in-house marketing department at West Point) made a specific choice to advertise there, or worse, they bought a generalized outdoor buy that delivers generic driver eyeballs in random locations with little oversight or audit.

Isn’t there a more targeted way to reach potential Army Football ticket buyers than a billboard in Stamford CT? Any form of directed advertising, from behaviorally targeted online ads, channel sponsorships, paid search, direct mail to alumni lists, blog ads on sports blogs, etc., etc., etc.

By the way, the day isn’t that far off when seeming anomalies will be spawned by the dozen thanks to media targeting programs that allow you to find anyone anywhere. There’s already Balihoo, which promises to let you find virtually any target across virtually any medium (including out-of-home). And I’ve got to believe that the best media buying companies have their own in house versions that go deeper, broader and faster than that.

But until that day, or if that day is here already, can someone please explain to me who the ad-snipers from West Point are aiming at on Rt. 95 north in Stamford, and why?