Firm Learns Tough Lesson After Dropping This Marketing Channel

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I recently read this story in the Wall Street Journal and I love telling it to my  marketing friends and watching their faces as I tell them the punch line.

Here’s the Story…

About a year ago, a CEO named Ms. Settle was looking for ways to cut back her costs amid the recent recession.  Considering all the advancements in online marketing and email, she decided it was time to let go of an ‘old school’ marketing channel that she thought had run it’s course.  She then placed all of her focus on email marketing primarily because of the low costs.

She had been spending more than $20k/yr. on this “out of date” traffic source, so it was a significant cost cut for her company.  Feeling confident about her decision, she excitedly reviewed her quarterly reports when they came in and was shocked to see that sales were down 25%!

You can imagine her surprise and shock. She figured the recession was worse than she realized.  Luckily, she was able to pinpoint the real issue. She lost the sales because she dropped one of the most solid and viable traffic sources she had been using for years. Her response was, “We realized we had made a HUGE mistake.”

She’s not the only one…the truth is, that a lot of companies have ditched this old marketing channel because of the recession.  Just as many companies ditched it just because it’s considered to be passé.

In June of the same year, Ms. Settles opened up the marketing channel that she closed, and almost immediately recouped the 25% in lost sales!

So what marketing channel did Ms. Settles ditch? … Offline marketing!

But it’s not necessarily the direct mail you’re thinking of (i.e. sending massive amounts of fliers to an untargeted list).  Like any marketing channel, direct mail has evolved too, and the bar has been raised.  The result is marketers spending more time to deliver personalized and more valuable content (something more appealing than junk mail).

What’s the moral of the story?  Don’t discount older marketing methods, instead breathe new life into them! The truth is, leaving them out could cut a hole in your business and ignoring could be preventing you from realizing your potential.

Are you guilty as charged? Leave a comment!

41 Comments

1. Pingback: Marketing Mistake – Worshiping the New

2. 

   wymetto

   February 3, 2011 at 4:52 pm

   Not quite sure what you mean by:
   The result is marketers spending more time to deliver personalized and more valuable content (something more appealing than junk mail) – is there an article on this?

   Reply
3. 

   nathaniel

   January 27, 2011 at 10:35 pm

   Think of an old “marketing channel” – pony express. In the 1800s in the US, if you wanted to market from the east coast to the west coast, one channel was the pony express. Is that marketing channel now dead? Probably. But is their some rural area in a third world country that is only accessible by pony? probably. Is commerce transacted across this channel? Probably. So, the challenge for marketers is figuring out all the available channels that can produce an acceptable return on investment, sticking to those and maximizing that ROI. In the US, there’s a very wealthy demographic that has very little internet connectivity, put they tend to read newspapers and answer their phone. So when I hear people stating that cold calling is dead and that newspaper ads are unproductive, I am stunned. Internet marketing and social networking are “hip” and cool but be very aware of how your most profitable clients really get their information.

   Reply
4. 

   jaysen clarck

   January 26, 2011 at 7:02 pm

   I love everything Related to the Old School Simply because it works …

   Reply
5. 

   Henry Goudreau

   January 25, 2011 at 10:30 am

   Needless to say, I’ve seen such a dramatic downturn in my niche that bringing in sales is almost non-existant. However, email appears to be the cost effective approach and I believe it is because of its high focus on existant customers. I lost $25,000 last year trying direct mail and I’ve been in this business (Internet) since 94. The same problem exists on bringing new prospects into my funnel to replace the old clients who have dropped off.

   Reply
6. 

   Mounts.uk

   January 23, 2011 at 11:09 pm

   Can’t agree more, moonshine, Digital marketing is only one part of marketing any business, whether you are driving new business to your website or direct to the telephone on your sales desk, there are many ways to do so. Get too focussed on one or more search engines and their SERPS and you can be ignoring and thus throwing away the best leads which are often not online, but right under our noses.

   Reply
7. 

   Moonshine Framing

   January 23, 2011 at 11:03 pm

   old school works. most of our “competitors” rely purely on SEO and search engines for new business when the reality is thaqt it only brings in 10% of our NEW business, and almost none of the repeat business. Neglect “traditionasl” advertising at youyr peril.

   Reply
8. 

   setiri

   January 23, 2011 at 8:24 pm

   I need to add this for one of my businesses, guilty of focusing too much online.

   Reply
9. 

   Body Transformation Specialist

   January 22, 2011 at 6:53 pm

   Wow, this gotta be why my biz is suffering! I’ve completely neglect offline-marketing! Thanks for sharing Ryan

   Reply
10. 

    Domonic Mongello

    January 22, 2011 at 1:48 am

    Great incite Ryan… to long people think all the answers are online and its just not true… all business need to maximize on ALL marketing and exposure models, and most especially be able to measure the metrics…

    Thx again for sharing Ryan. dom:)

    Reply
11. 

    Wayne

    January 21, 2011 at 8:54 pm

    How *Refreshing*! Thank you Ryan for sharing Value through Relevant Content. It’s great to see this, and it sure beats another Goofy-Guru Blind Offer loaded with multiple “okay/cancel” pop ups, numerous upsell/downsells, and (yawn) rah, rah, rah, blah, blah, blah (more yawn) like the mindless midnight TV infomercials.

    Reply
12. 

    treadmill

    January 21, 2011 at 7:47 pm

    thanks for reminding me about offline marketing, more expensive to do but done right its highly effective

    Reply
13. 

    Emily

    January 21, 2011 at 6:04 pm

    This is the problem with lots of Internet marketers. They just focus on the “internet”. Real marketers take an overall perspective. Every bit of marketing complements each other. This is how I help my clients when consulting them on social media and SEO. I help them implement their offline marketing with their Internet marketing.

    Reply
14. 

    Jonathan Roseland

    January 21, 2011 at 5:48 pm

    Agreed but there are some old school marketing methods that are just pure crap – Like yellow pages advertising. Cost me about $1000 last year

    Reply
15. 

    Laurie

    January 21, 2011 at 4:16 pm

    My first go-round as a business person was BEFORE the internet. My first computer’s operating system was DOS. So, I actually know quite a bit about off-line marketing. I recently took a class with Bob Burg, and was reminded again that nothing works as well as face-to-face networking. That’s how I built my first business, and today I’m going to go join the Chamber of Commerce. People do business with you if they know, like and trust you. Offline or on, the principle is the same. <3

    Reply
16. 

    Colette Morris aka workfmhomediva

    January 21, 2011 at 3:15 pm

    Ryan I have to agree there are a few offline methods that work well and it is key to track track track as mentioned above. Interesting and informative post. Thanks for sharing.

    Colette Morris

    Reply
17. 

    Dave Gardner

    January 21, 2011 at 3:15 pm

    Having balance is always crucial to success. People are becoming to at ease with deleting emails from marketers, especially when you can get hundreds a day.

    Sending something they can physically hold in their hands is a nice curve ball to throw them and may be easier to find and stick on a wall versus getting lost in the depth of the email saved folder.

    Being able to add a special code as well or link can help you also with your analytics especially if you are promoting something only through this offer that is not online anywhere you will know exactly how they found out about you.

    Reply
18. 

    earl newland

    January 21, 2011 at 3:04 pm

    This article is reassuring for me as I use an online greeting card service to create custom post cards or regular greeting cards to do my own personalized direct mailings and/or thank you cards. It was introduced to me as appreciation mrktg. Very effective and I even get phone calls saying thanks for the note. I originally got my card service just to send thank you’s to my clients but it has evolved into so much more. Thanks for the article and affirmation.

    Reply
    • 

      earl newland

      January 21, 2011 at 3:15 pm

      @earl newland, Yes, I am a sendout cards dist. I can’t imagine life w/o soc.

      Reply
19. 

    Tony Clingan

    January 21, 2011 at 3:04 pm

    I think we can be swept along thinking older methods are out dated, certain things are timeless, others only last a few weeks or months at most, I think the real lesson is about first principals, ie testing and looking constantly at our analytics and other measuring tools

    We must know what is going a good roi and what is just money down the drain

    Thanks for sharing Tony

    Reply
20. 

    Christian

    January 21, 2011 at 2:56 pm

    My business was 100% marketed throught the internet using ppc,seo,google local,email marketing,craigslist,etc.

    Just 2 months ago I started using print ads in my local city’s magazine that gets delivered to a afluent neighborhood and ran a direct mail sales letter to a targeted list and now my sales increased by 45% because some people just don’t go to the internet to find information.

    There are still people out their that look in magazines and read their mail still. we can’t forget those people who want to buy are stuff but aren’t internet savy.

    Reply
21. 

    Jim Walz

    January 21, 2011 at 1:41 pm

    Hitting the delete button on 10, 20, 50 emails with one click is wayyyyy to easy for a potential customer.

    Reply
    • 

      jaysen clarck

      January 26, 2011 at 6:56 pm

      @Jim Walz, thats True
      80 / 90 of them press the Delete Button

      Reply
22. 

    Tim Chambliss

    January 21, 2011 at 12:22 pm

    There’s still nothing like having prospects hold your marketing materials in their hands, but it becomes so much more powerful when fused with the web (QR codes anyone?). Let’s ALL avoid the pit of offering online marketing as a “cost savings” against anything that gets RESULTS!

    Reply
23. 

    jesse

    January 21, 2011 at 12:06 pm

    To be honest I havent given this type of marketing much attention in the last few years.Looks like I need to rethink that strategy.Thanks for the article.

    play well & play often

    Reply
24. 

    Michael

    January 21, 2011 at 12:05 pm

    Hey – shock news! Some people still don’t like wading through a ton of emails – and often the business owner/CEO doesn’t handle his own email so this is a real no-brainer. We are too often guilty of getting hypnotised by the “bright, shiny and new”. And the beauty of offlline is that it can be completely complimentary to online activity.

    Reply
25. 

    Ed Neering

    January 21, 2011 at 12:01 pm

    Track Track Track-Most people don’t know whats going on because they don’t track.

    Reply
26. 

    OEE

    January 21, 2011 at 11:58 am

    The problem with off line marketing is that it can be hard to track just how effective it actually is. Obviously this lady found out when she stopped doing it.

    People in the on line marketing business often discount the effectiveness of off line. However for some demographics it still works really well. For example children and teenagers still love to get relevant targetted direct mail.

    Reply
27. 

    Vicki Berry

    January 21, 2011 at 11:57 am

    Hi Ryan!

    This is such an important post to bring home the importance of offline marketing. Though internet marketing can be a valuable addition to your strategies is should never replace the offline approach! My own success with recruiting is definitely found through my offline efforts as well as the supplemented online approach!

    Thanks for a great story!
    Vicki

    Reply
28. 

    Mandy

    January 21, 2011 at 11:45 am

    Makes sense.
    You still need person to person contact to sell and belly button to belly button contact for the rest of the story.

    Reply
29. 

    Dave Davies

    January 21, 2011 at 11:38 am

    I literally destroyed my publishing business with 2 moves:
    1. I did massive direct marketing to promote an MLM company
    (they filed for bankruptcy leaving me with 3000 customers demanding a refund)
    2. I switched to Internet marketing instead of continuing direct mail because I was broke. I’ve barely survived on the Internet vs making over $350,000/yr with direct mail.
    So, I agree. My lessons are two-fold:
    1. Create your own products – don’t trust companies to protect you.
    2. Never give up what has been working to save a few bucks.

    Reply
30. 

    Dan Rice - Online MLM Profits

    January 21, 2011 at 11:36 am

    I heard a great marketer say, “Zig when everyone else is zagging.”

    Reply
31. 

    Marvin

    January 21, 2011 at 11:35 am

    Hi Ryan,

    Definitely offline marketing is twice as effective when combined with online marketing. We are doing something different in our business, we offer Internet, print and TV marketing & advertising campaigns to our clients. The results are amazing, just combining 2 of the three will give your customers a high ROI.

    Best!

    Reply
32. 

    Lynda

    January 21, 2011 at 11:22 am

    Hi Ryan,

    This is so true, and its funny you bring this up since I was just mentioning this to my husband about my business.

    And why not … dont discard the old marketing ways, people do read the flyers they receive and if it interests them, well then … it worked!

    Reply
33. 

    ThePerfectDesign.com

    January 21, 2011 at 10:58 am

    Ryan,

    You’re right. It’s great to see internet marketing gurus still talk about offline marketing. Both options are valuable to a companies’ success.

    The interesting thing to note is I know many people who have started online businesses and they don’t do any offline marketing. It’s because all they know is the internet.

    We do a lot of both. Adding a personal flavor to the mix, like offline marketing, can bring a lot of trust to potential customers.

    Thanks,

    Chad
    ThePerfectDesign

    Reply
34. 

    Yves Martin

    January 21, 2011 at 10:41 am

    I haven’t made this mistake but I do Internet marketing for law firms and one of my clients asked me if they should drop their Yellow pages advertising.

    My question to them was “What is your return on investment?”. They had never really thought about it and after some investigation turns out they get a 500% ROI on their Yellow pages ad!

    Lesson – don’t wonder or guess at your ROI from a marketing channel. Know what it is and base your decisions on that.

    P.S. We still have a great contract with this law firm for Internet marketing because our ROI on that for them is also 500% +. Now they have two great marketing channel and they don’t know the word “recession”.

    Reply
35. 

    Glen Kohlenberg

    January 21, 2011 at 10:40 am

    Ryan spot on with this post. I am an old school mailing guy in the home improvement business. But I had a hard time giving up some of my mailings and display ads for Internet and emailings.

    I found a great mix of all of it now works best and now that social media is here all my god! Instant sales machine!

    Thanks, Glen

    Reply
36. 

    Paul Simister

    January 21, 2011 at 10:24 am

    One of my key coaching questions is “what’s working at the moment… and can we do more of it?”

    It’s back to the old problem of businesses getting tired of their marketing before the potential customers.

    I think it was Dan Kennedy or Gary Halbert who tells the story of a direct mail letter the CEO tried to kill because the market is bored, even before it had been tested.

    Reply
37. 

    Jo Shaer

    January 21, 2011 at 10:20 am

    Offline marketing is definitely still something that should be done but proper ROI measures need to be put in place. So many of my clients pay out a fortune for these but have no idea which methods are actually working.

    Reply
38. 

    Karen Marrow

    January 20, 2011 at 10:44 pm

    Ryan,

    It’s true. I think with the internet, there is a tendency to let go of those marketing strategies offline that were working. Like you said, you might have to change it up a little, but not drop it altogether.

    Karen

    Reply
39. 

    TrafficColeman

    January 20, 2011 at 11:55 am

    Old marketing ways works..but you do have to go about them a little different..but they still hold value..

    BTW Ryan..Can you can contact me on my contact page..Its very important..I need your help.

    “Black Seo Guy “Signing Off”

    Reply