A-Clue.Com
by Dana Blankenhorn
Volume III, No. XXXIX
For the Week of September 27, 1999

This Week's Clue: E-Mail Marketing

This Week's Clue: E-Mail Marketing

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The Beanie Baby Clue

Media Bias is in the Eye of the Beholder

Brobdingnagians in Disguise

Clued-in, Clueless

This is an e-mail, and the subject of this e-mail is usually marketing. Yet I seldom talk here about the hottest subject in today's online world, namely e-mail marketing. Let's rectify that situation.

Outfits like RadicalMail  and Media Synergy are turning e-mails into multimedia Web pages, while firms like MessageMedia and Post Communications  are growing like topsy sending e-mails by the millions. Then there's Slangsoft's VeloMail , which claims to solve the problem of translating marketing e-mail into other languages. (Have you gotten your Chinese spam yet?) I even saw old Walt Rimes (Sanford Wallace's former partner) at an Interop booth promising "permission-based e-mail marketing."  There are also dozens of companies claiming "e-mail marketing expertise" for sale, from "old-timers" like Multimedia Marketing Group and E/Y/E/S/C/E/A/M Interactive  to fly-by-night operators. 

What is often missing amid the hoopla is the customer's perspective. Anyone with an e-mail box knows that their "permission" to take marketing e-mail has a very short life span, and little promise of attention. You're looking to buy something so you agree to take messages, then you buy whatever it was and every week you're bombarded again. The result of all this is a glut in your e-mail box, not permission marketing.

I talked all this over with Nick Usborne recently and he ascribed a lot of it to short-term (venture capital driven) thinking.

Companies are building big lists because the bigger the list, the more powerful they look. The bigger your network becomes (We have 8 million names! We send out 100 million e-mails a month!) the faster you reach the Promised (IPO) Land. So Nick's even seeing opt-out e-mail captures, from reputable names. (Examples -- click here to not get our e-mail, or send us an e-mail that has the word "remove" in the right place or you'll keep getting our e-mail.) Who's kidding whom?

It's Seth Godin's  name that's mostly being taken in vain here, and the Permission Marketing Yahoo (that's his real title, kids) calls mistakes just part of the learning curve. (He must have been a teacher in a past life.) Yahoo's gotten great mileage lately with its "Birthday Club" - sign up on their list and you'll get a "card" on your birthday filled with valuable coupons. It's totally opt-in, very Clued-in. But Seth admits Yahoo still hasn't taken it to the next level - filtering the list based on other demographic (or better yet, he says, psychographic) information people give Yahoo permission to use. Such an advance would increase the number of advertisers the program could handle, and increase the clickthroughs. But it takes a lot of work to filter millions of names through billions of fields, and it takes lots of intelligence to direct this work correctly. (Your Clue is this -- When the master is admitting error, you have a lot to learn grasshopper.) 

So even if we know where we're going, we still have a long way to go. Lots of people who claim they know where they are going don't, or (worse) don't want to, and their Cluelessness is muddying the waters for everyone else. Until people realize that a pitch ain't a sale, and the key isn't the content of the pitch but finding the right person to pitch (someone who gives a darn) all this will remain true. But Seth's right - some people do learn. And remember this final thought - you can't learn unless you change your mind. Keep changing. 


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This week we begin our adventure at Voxcap.Com, discussing how next year's elections might impact the future of the Internet. I hope to see you there. And on October 8, at 10 AM, you can see me, live and in person, in a one-hour session at Internet World in New York. See you there.

I write daily for ClickZ, and appear every Saturday at 6 Eastern on TechEdge Radio in Phoenix, Arizona. I write monthly columns for  NetMarketing, Boardwatch, and  Intellectual Capital. Watch for my series soon on VoxCap. The lead item here is also the Monday e-commerce column of Andover.News. You can still buy my book . Subscription instructions are at the bottom of each issue.

Remember that it's still journalism -- checking the news, calling people, listening carefully and writing on deadline -- which keeps the Clues coming. If you're looking for excellent work, give me a call at 404-373-7634. Now back to the show...


Takes on The News

The Beanie Baby Clue

You can learn a lot from a bag of beans. Beanie Babies looked like a played-out fad a few months ago. Then creator Ty Warner said he would stop selling them at the end of this year.

Suddenly the fad has legs. Ty's latest deal with McDonald's no longer looks like a loser, and the man has lots of other ideas. He knows it's not the Beanie Baby itself that's the key to success, but the ability to father other compelling products. If this move makes him more of an "international man of mystery,"  remember that he can still play J.D. Salinger (obsessively keeping his privacy) even while his fame grows.

Thus the Beanie Baby Clue - the value of scarcity. The "Wall Street Journal" takes advantage of this Clue. They have just 285,000 paid subscribers, Sarah Stambler told the I-Sales list recently, but bring in more money than the New York Times' 7 million registered users do. Readers turn their stories into money, and thus scarcity works for them.

Certainly you have to ask whether what you have is scarce, and what your scarcity value might be (as opposed to your value to a broader market). You have to be clever in capitalizing on this value (if you find it exists at all). You take a risk that if you've overestimated your scarcity value you've left money on the table. But when everyone can get everything, saying "no" can be very powerful. It's an idea worth a careful look - emphasis on the word careful.

Media Bias is in the Eye of the Beholder

Jay Fenello of Atlanta thinks the media is biased. He calls ICANN's work an "illegal and immoral takeover of the Internet."

I've been skeptical of ICANN (Fenello approved of my "Queen of the World" column for ClickZ ) but before any other reporters follow Fenello, do some research. When Bill Clinton and George W. Bush both claim the press is biased, what they want to do is to shame reporters into seeing things their way. The fact that players on all sides do it is a good indication to journalists they're on the right track.

In this case, Fenello is a player, not an unbiased Netizen. He wants unfettered control of his own top-level domain, .per. Like a rancher in the Old West who doesn't like the sweet deals given railroad barons, and the farmers who followed them, he just wants to water his cattle (customers) and considers himself a civic hero. But he's changing everyone's ecosystem, turning what should be the commonweal into his own wealth. He thinks anyone who argues for the farmers or railroads deserves (at minimum) harassment and disgrace. (That's my bias talking, Jay.)

I saw this movie just a few weeks ago. Me, I'm more like Edmund O'Brien's drunk newspaperman (he got his office trashed), and Esther Dyson (like Jimmy Stewart in the movie) isn't about to shoot anyone. But if you do the research, and ambush these jerks when they try to bully people into confusing their self-interest with the general interest, then you too can be John Wayne.

Brobdingnagians in Disguise

The sight of Microsoft, Excite-@Home, Dell, and a half dozen other corporate giants (notice Yahoo isn't among them) having to fight together against big, bad eBay brought out the humorist in me last week . But on further review here are a few serious points to consider.

First, Tony Bove pointed out that all the negative features about eBay are meaningless, except for stories that come out when its system is down. That may or may not be true. I happen to think credibility and honest dealing are meaningful concepts. It's not just eBay's illegal giblets that concern people, but technology being used to manipulate its auctions. Crooks are using eBay to rip people off, by misrepresenting what they have or manipulating the bidding. The biggest mistake analysts (and eBay itself) make is to assume this is an easy profit because the auctioneer never takes possession of the merchandise. That is simply not true.

The second point is there may be a way for eBay to get its arms around both these problems - both the new competition and the crooks. That would be a well-run affiliate program. What if eBay-branded services were available on small content and e-commerce sites, with those site managers getting a commission in exchange for policing their own offers? Don't just get the loyalty of users, in other words, but potential competitors. And don't give these folks anything free - make them responsible for the action they bring to the table.

Clued-in, Clueless

Clued-in is Andover.Net , not for going public but for the way they're doing it, in a modified Dutch auction. Such a system, where interested buyers place bids before the market opens, assures the company will gain the maximum capital from the move. (Salon.Com did the same thing and was slammed for it, but it scooped up profits from arbitrageurs, and that's not a bad thing.)

Clueless is the study by Bizrate.Com claiming 75% of buyers would reduce online purchases if sales taxes were imposed. The idea is to scare state governments out of imposing such taxes. This is one of those nakedly political studies that do a cause more harm than good - it's easier to see through than a plate glass window, and encourages your opponents to throw rocks at you.


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