This week, yet another "revolutionary" e-marketing scheme fell apart. Freeway, by Broadpoint Communications, sent out an email to its members informing them that its services would be suspended until further notice. Although lip service is being paid to a resumption of service, it's clear that the Freeway business is on its last legs. The end of Freeway signifies more than just the failure of one business, but the emptiness of one of the biggest marketing hypes of the E-Boom and Bust: permission marketing.
The Revolution That Never Was
Permission marketing pretends to be revolutionary, but in the end it's just a rehash of some very old and very tired sales tricks. The greatest strength of the permission marketing method is the way in which its main proponent, Seth Godin, has marketed his ideas as business revolution. His ideas are outlined in his book of the same name, Permission Marketing. In this book, he tries to convince his readers that he's got a brand spankin' new way of getting people to buy things: by buying in. He calls it "making strangers into friends and friends into customers", but really it's just a new version of the old idea of stringing people along with free offers in the hope that they'll eventually buy something. If you think that sounds a bit naive and desperate, you're not alone.
In the case of Freeway, the permission marketing model was set up as follows: members, who signed up at no cost, were given 2 minutes of free long distance within the United States for every 15-second advertisement they listened to. If a member listened to 10 messages, he or she would get a free 20 minute phone call. On the face of it, it sounds like a perfect plan: members get free long distance, advertisers get a captive audience and Freeway rakes in the dough. Well, it worked out great for members, but not so well for advertisers and downright awfully for Freeway. Although members were supposed to be able to hit a telephone button to receive email from advertisers, they almost never requested the emails. Freeway couldn't promise increased sales to advertisers, so no big businesses signed up. Freeway members were left listening to advertisements from companies like Lobster-Gram.
Unfortunately, by definition business is non-revolutionary. Because business is all about making money, any so-called business revolution goes only so far before someone points out that there never really was any revolution to start out with. Godin is part of that e-generation that wanted us to believe that the e-world would change e-everything in e-no-time e-flat. E-yech! E-guess again. The Internet is a revolution in technology and in communications, but business is still business. Think of it as a circus: you can give the dancing bear a new hat and a lycra cape, but it's still just a dancing bear.
The Tricks of Permission
Godin wants to make permission marketing sound like something new, but in fact it's old hat. Music and book clubs have been practicing this supposedly new form of marketing for years, tempting you in with offers that are too good to be true, then hitting you upside the head with the catch.
That's really all that permission marketing adds up to: the old con game of playing someone along with swell offers and then hitting them up for a mega-profitable rip-off. Godin and his disciples will try to tell you that there's more to it, but there isn't. All of the NEW stuff Godin takes credit for is little more than a tacky lycra cape on a dancing bear.
Email Marketing? Get Serious!
My favorite part of Godin's book is the section in which he sincerely writes about how business folks can use email to perform the old permission marketing scam. He claims that by offering free services in return for a person's email address, for example, that a business can build up a reliable database of contacts to send targeted advertisements to at an insanely low cost.
Will this tactic work for you? Probably not. Consider the following -- as much as marketers are trying to pull one over on customers, customers are trying even harder to pull one over on naive marketing programs. Myself, sure I get plenty of free services online in return for giving out my email address, but I almost always give the enthusiastic e-marketers a dummy email that I sign up for for free and never ever read. Some computer somewhere in California just holds all their annoying ads for me. They're never read, and I get the free service. Even when I have to give out my primary email address, I can easily set my email program to automatically delete any annoying email advertising as it comes on in. Permission granted, then permission denied!
Even more important for marketers to understand is that email marketing is considered rude by its nature. I don't care if I signed up to receive an email "newsletter" every week. I still feel bothered when I get it, and my opinion of the company that sends it goes down.
In the case of Freeway, I found the 15-second advertisements obnoxious even though I got free long distance in return. Within a day or two, I learned to hold the phone far enough away from my ear so that I didn't have to listen but could tell when the advertisement was over. For me, and for the huge number of Freeway customers who used the service in this way, the arrangement was perfect: I gave Freeway "permission" to send advertisements over the phone that I never even heard and got my free phone calls in return. The failure of freeway demonstrates the arrogance of Permission Marketing. Permission Marketing assumes that customers are stupid enough to fall for any old marketing schtick that's sent their way. The fact is that people are much more saavy than that: they'll do their best to wring as much value out of a business offer as they can.
Permission Marketing's oft repeated catch phrase is "Turning Strangers into Friends and Friends into Customers". If Seth Godin really thinks that he makes friends by providing them with freebies, he's got an awfully strange idea of friendship. The fact is that friends don't sell friends stuff. The instant that a company tries to get me to buy the big Permission Marketing hook, I'm gone and I don't feel guilty about it.
Business School Bunk
Just as it has always been, success is about ideas, not marketing theory. I'll give Godin his due: this book is better written than the average business school bunk. On the other hand, that's not much of a compliment. As is the case with most business writing, the ideas that the author claims are revolutionary are really nothing more than run-of-the-mill hucksterisms. Even worse, they're run-of-the-mill hucksterisms that don't work, as the case of Freeway makes clear.
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