Wednesday, February 13, 2008

** Meatball Sundae by Seth Godin

Seth Godin (ex-Yahoo, currently of Squidoo) is probably the best known guru of internet marketing. His ideas are out there, and he wants everyone to know his strong opinions. I like him because he is willing to think outside the box, and challenge the established assumptions. Any business with customers should think hard about how to market effectively via the internet, and how to leverage new models to perhaps transform your business or industry.

So TV is good for something after all

TV ads require factories to make items in sufficient quantity to pay for the commercials. They require shelf space so that when hordes of people go to the store to buy the advertised item, it’s there. And they require avg products because TV reaches everyone… Direct mail permits specialty retailers to thrive in a way they never could in a strip mall. It hates products that appeal to everyone… It needs to be sent directly to just the right people… It requires teams of people to answer the phone in the middle of night… It requires low inventory, because it’s too expensive to keep the warehouse full of an item that’s not selling. P11

The First Marketing Genius

The founder of the Wedgewood China company was famous for smashing imperfect items with his walking stick, proclaiming “This will not do for Josiah Wedgewood!”… Remember in 1730 it was still common for people to eat their meals out of a bowl of stale bread. Ceramics, a plate of any kind, was a bit of a luxury. The idea that you would smash plate just because it was a little irregular was nuts… Wedgewood risked his entire company in 1772 by investing $2.7m and sending, without asking first, samples of his pottery to 1000 wealthy Germans. Believe it or not, more than 50% ordered the pottery. Several years before that, Wedgewood gave Queen Charlotte (George III’s wife) a breakfast set. A few years later she ordered a full tea service, which he turned into Queensware and sold to the masses… Did I mention that his sales force worked on commission? – another breakthrough… He dealt with the increased demand by creating one of the first assembly lines… Here are some other items of note to his credit:

  • Sign your work (brand it)
  • Increase your pricing by 400% (luxury’s should be expensive and exclusive)
  • Establish outrageously high quality
  • Train non-skilled labor in your new production techniques
  • Sell to the richest people in the world

Misplaced opportunity

An inbound email is not just an expense; its also an opportunity – a chance to eliminate barriers and have a dialogue with a customer. The logical place for a person to start the relationship is the CEO. What happens though? Absolutely nothing. No response of any kind. P62

Why search ads are cost effective

Its not unusual for effective advertising to sell for $50 per CPM. Studies show that 7% is a high number for the number of consumers who can even REMEMBER your ad, never mind actually take action because they saw it. Which means that you’re paying closer to $750 for every 1000 people who ever saw and remembered your ad. P63

Permission Marketing 101

Permission doesn’t exist to help you (the marketer); it exists to help me.

  1. My permission can’t be bought or sold. It’s nontransferable.
  2. I don’t care about you; I care about me. If your message has something to do with my life, then maybe I’ll notice, but in general don’t expect much.
  3. Privacy policies and fine print are meaningless. I trust you and if you break that trust we’re finished whether or not you’re legally in the right or not.
  4. I demand your respect, so if you disrespect me then you’re history.

The 1% rule

Only 1% of the users on sites like Wikipedia create and edit articles. This ratio holds true for Digg, Reddit, YouTube, etc. The thing is you don’t know who these 1% are… It’s like Russian roulette. You have to assume that every chamber is loaded, that every interaction is an interaction with a critic. P74

Godsourcing, the new outsourcing trend?

For decades, the Catholic church has been outsourcing the duties of saying special prayers to priests in India… It costs only $.90 in India vs. $5 for the same prayer in the US or Europe. P116

You want fry's with that?

Pull into a McD’s drive through in Oregon and you’ll find yourself talking to a voice from North Dakota that is beamed to you across the net… By pooling the inputs of several McD’s to one call center, they end up eliminating down time and they can provide better training and quality control (not to mention the low wages). P117

If a job can be codified, it WILL be outsourced. P118

25% of the US population was willing to donate a kidney if it would save a life. will help you get matched to a person in need. P137

The web is the single worst medium ever devised for interrupting people who don’t want to be interrupted. P192

It will take more than 1 election cycle for TV to become irrelevant. The ability to send a message (think YouTube) to the base and do it with no filters, no time constraint, and little money is too powerful to be resisted. P171 Will this allow us to take back our politicians from the special interests and corporate lobbyists?

Viral Marketing 101

Make something worth talking about and make it easy to talk about and share.

Humans don’t act like robots or machines… Given enough choices, we’ll make those choices. P220

Seth's conclusion

If you want to sell commodities, be my guest. If you want to sell large quantities of cheap stuff, you’re welcome to it (WalMart has this market already). The rest of us are going to grow fast using our knowledge of human nature and the new marketing that allows people to express that nature. P220

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