AIAIO: Our Blog

AIAIO: Our Blog

The pulse of Alexander Interactive

Posts Tagged ‘marketing’

When CRM backfires

The Leaders Club, a chain of luxury hotels, recently sent me an email that I had to “renew my membership,” which is free. The email did not have any links in the text version. The link in the HTML one sent me to a page with multiple upsells and a small “renew membership” button. Clicking the renew button sent me to the Leading Hotels of the World home page without a confirmation or thank-you page.

Snapfish sent me three warnings in December that they were disabling my account–not because of inactivity, but because I hadn’t made a purchase. I could have logged in, emailed a request, posted new photos, sung the site’s praises on this blog. But because I hadn’t completed a paying transaction in a year, they turned off my account and wiped out my photos.

These organizations share the same shortcoming: in an attempt to cleanse their database of inactivity, they purge much of the loyalty and positive experience that was once part of the relationship. Both companies have a service that I once found compelling enough to join and, in both cases, spend money on. But somewhere along the line, an administrator set a renew-or-kill point in the database.

Consider how the competition handles this. Unlike Leaders Club’s renewal request, Starwood has had my Preferred Guest account for years. I use it once a year, give or take, just like Leaders Club. They have twice upgraded me to Gold status after a period of inactivity, to encourage me to interact again. Marriott and Intercontinental send me monthly reminders to pay them a visit, despite the fact that I’ve not used either account in more than a year. Meanwhile, Leaders Club suggested I’d lose my privileges if I didn’t go through the renewal process. Which one is more likely to get my business the next time I book a hotel?

The Snapfish situation is even worse. I have photos on Kodak Gallery that date back to the Ofoto years, and I’ve never had trouble with my account (although people have lost images due to inactivity in the past). My Flickr account is free and accessible in perpetuity. What makes Snapfish so inscrutable is their hypocricy: I logged in today, several weeks after not taking action on their last “You’re going to lose your account” warning, and my photo album from December 2006 is still there.

Maintaining links to opted-in consumers is the prime objective of today’s marketplace. Doing it right leads to better word of mouth, retention, and revenue. Do it wrong, and, well….

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Social Graphs and Marketing – The Truth

There’s a fair amount of excitement recently about Google’s Social Graph API.   In a nutshell, the API aggregates various social connections from any number of compliant social networks (Facebook, MySpace, Twitter etc) allowing an application to see the entire picture.  I had a strong hunch that social  networks  were going to break out of their walled  gardens and  just become another app on the internet.  It seems to be happening.

It sounds great, but it might be worth spelling out the driving force behind connecting you all together.  It’s marketers, coveting the power of endorsement.
When one person, with no personal stake, makes a recommendation of a product or service to another – that’s marketing gold.  No advertisement, no sponsored search result, no viral message comes close to the power of a personal recommendation.   Marketers would love to harness that.
Facebook went down this path with their Beacon disaster initiative.  Every move that a Facebook user made that involved one of their partners was broadcast to their friends.  All of your friends would suddenly be told about the tennis shoes you had purchased.  Of course this was immediately seized upon as a gross invasion of privacy, and Facebook backed down from it.
Still, this shows the real goal of social networking – it’s a marketing platform that harnesses the power of recommendation in order to sell things.  It’s that goal that drives so many new companies towards the social networking space.  That’s what social networking is really about.  Re-connecting with your high school buddies is a side effect.
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What’s Privacy Worth?

What is this thing “privacy” that we seem to be in constant peril of losing?  In Europe it seems to be treated like a sacred substance, with various laws protecting it.  In America it has significantly less value, being signed away by private citizens to corporations hungry for consumer data, without a second thought.  What is it, exactly?

I think there are probably a couple of components to privacy:
  1. Information: Meaningful data about someone.  Some information we’re only to happy to push out to the world as environmental spam: the car we drive, the house we live in, the brand of shirts we wear.  So the existence of information by itself doesn’t constitute privacy.  There’s an additional component.
  2. Restricted Access:  Not just anyone can get all of our information.  Some of it is private, and can only be accessed by the appropriate individuals.  We have different ways of categorizing access – for example we pretty much hand the keys to the kingdom for our financial information over to our accountants, but probably wouldn’t tell them everything (or anything, necessarily) about our health.

But still there’s more.  The real truth is that most of what is controversial these days about privacy has to do with observation of our behavior.  Where did we shop?  Where did we surf?  What did we buy?  What are we likely to buy?

Ok – this kind of information is valuable.  And in our society we have a mechanism to deal with the transfer of value from one party to another.  Its called “money”.
Show. Me. The. Money.
How about this – lets create a trade unit with which I can distribute my privacy.  A “consumer behavior credit”.  A credit is defined as:
  • The right to my observed behavior,
  • For a specified period of time,
  • Within a specified scope,
  • For a specified use.

So for example, I might grant you the right to watch me surf around on amazon, spending way too much on books.  So I could sell, for fair market value, 1 day of me surfing book websites, for the purpose of channelling advertising to me.  $5.00 please.

Lets make it easy.  A marketplace for consumer credits.  OpenID style.  I (the consumer) sign up for credits, and set business rules under which you may observe my behavior (for $).  Perhaps I can have “personas” which allow me to separate “Business Loren” from “Fun Loving Guitar Phreak Loren“.  Then, a website that participates in the program can happily harvest my information, sending me compensation for it, and use it according to the terms of the license.
You get your information, and I get compensated for what my privacy is worth.
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On direct marketing and user experience

Usability maven John Rhodes published a clever piece last week entitled How Direct Marketing and User Experience Are the Same. The cited examples are quite good and worth contemplating (Rhodes is often right when it comes to UX matters). Particularly for ecommerce sites, the direct-marketing correlation is strong.

Something the article did not do, though, was reverse the angle. The piece focused on how the technical details of UX work are similar to the fundamentals of direct marketing. But direct marketing also has a lot in common with the qualitative side of user experience work. To wit:

  • Simple, clear instructions maximize conversions. In any direct marketing appeal, the endgame is straightforward and easy to spot–as with the majority of UX-centered processes.
  • First impressions are lasting impressions. Consumers decide in seconds whether they have a good or bad feeling about a product, company, or website (especially a website). Similarly, a good piece of direct marketing leaves consumers with a positive feeling that either leads to a sale or is retained until a later conversion opportunity.
  • Understanding and relating to the end user is key to long-term success. Like a good website, a good direct marketer will fine-tune and localize messages over time, creating a more intimate and useful dialogue that leads to greater response rates.

One aspect that may not be the same is the value of the individual viewer. A user-experience expert would cite the necessity for all users to have as positive an experience as possible. Conversely, some direct marketers are looking for scale above all else, and are unafraid to sacrifice some people in order to reach others effectively. This is good for short-term sales, somewhat less so for customer retention and positive recall. Which, of course, is where UX comes in.

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Stupid or Malicious?

We’d like to keep you informed via email about product updates, upgrades, special offers and pricing. We will not pass your details onto third parties. If you do not wish to be contacted via email, please ensure that the box is not checked.

Is it just a horrendous mutilation of the english language? (It could have just said “Contact me with product updates, upgrades and special offers”). Or an intentional manipulation by an unscrupulous marketer? Do you think I’ll be pre-disposed to buy stuff from you after you’ve jerked me around on this, Logitech?

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