Defining marketing the 3rd way

Quotes

• “When I was writing the book, I decided I needed to build a platform and I have ideas of content I wanted to write. So I started to write a newsletter just with the followership I had and then it took a life of its own. Its been great, I have roughly 25,000 subscribers now, hardly an empire but a lot more than it was two years ago.” - Ed

• “As I did that I expanded that and I went from writing short essays a week to writing fairly long essays every week, I have a briefing every week and two podcasts every week and it has taken my life a little bit which has been good in many ways but the book has been delayed.”

• “Part of it is organic and Im at a part of my life where I wont do things I dont enjoy. So I enjoy writing essays and consolidating what happened with the world and happy to share it with others after I do it. I enjoy talking to people and it became a kind of excuse to structure my life around doing that.” - Ed

• “One option was to get out one free newsletter and a paid one with three more newsletters. When I pulled my audience about what they wanted more of, that is not what they wanted. People say, the essay is already deep and thick and the idea of doing three more was intimidating than joyful. But they liked the idea of link round-up and interviews with CMOs.” - Ed

• “The audience seems to say, for you to give me more, give me more different things than more of the same thing.” - Ed

• “The second aspect of the strategic point of view was the idea of bundling. One of the ways you try to create a good bundle is to have fans but not super fans. A super fan is someone who really, really wants what youre offering. They will go out of their way and pay for it. A fan is somebody who is interested but wont pay the full price for it and they certainly wont go looking for it. And non-fans, obviously, are those who arent not just interested at all.” - Ed

• “An ideal bundle, you want to bundle things that have fan overlap but not super fan overlap. If someone is a super fan of my essays, they may pay for three more essays. But if someone is a super fan of my essays, and a fan of weekly round up and a fan of interviews with CMOs, by putting it in a bundle together, in theory, the economics makes sense.” - Ed

• “For a long time, marketing was pretty archaic. They have a bunch of theories of how things work without really understanding if they actually work or not. Then people tried to make it more scientific by putting numbers on it but the numbers were still kind of meaningless. Its called the Mad Men era of marketing.” - Ed

• “If you want to be ahead of marketing you have to be a really good storyteller. It didnt matter if your results worked or not, it matters that you could tell a story that they were working. That was the brand marketers, or qualitative marketers and thats what marketing was for a century.” - Ed

• “Part two was, sometime around the 1960s or 1970s, direct-response marketing took off and these guys are very scientific. They did test and control, random control like should the color be red or green. It started with Book Clubs and they realized if they lower the price of book clubs from a dollar to one penny for initial entry, the lifetime value was higher for customers acquired. It was testing in numbers.” - Ed

• “Before no one came to school to become a direct response marketer. They were the poor stepchild of the marketing profession. But once the internet took off, all those techniques of direct response marketers became popularized because all of a sudden, the internet was cool. Merely because the internet was making money for some people and money makes things cool.” - Ed

• “So all the direct response techniques that had been around for 20 to 30 years got moved into online marketing and became performance marketing. Performance marketing took over marketing in many, many places. Its great, it is measurable. You can measure the ROI and it becomes a math problem.” - Ed

• “The problem becomes, performance marketing has a very short-term feedback cycle. So if you go and measure a page on click search and it turns into a sale in two days, you can measure the ROI in that. But if you run an ad that reduces the price elasticity of your product so you can charge a higher price two years from now, how the heck do you measure that?” - Ed

• “So there is this third way which is using logic, the data, the rigor and coming at it from a quantitative perspective but understanding that just because you cant measure something doesnt mean its not important.” - Ed

• “I always say that marketing is both an art and a science. To me when you talk about the third way marketing, the contrast of the Mad Men era, brand-driven, storytelling marketers or the data science quantitative marketing, those two things in a vacuum can be effective.” - Ben

• “But the most successful marketing in the world is a combination of the two and then you throw in the gasoline of the internet and the ability to distribute information easier and all of a sudden, you need to be able to differentiate with brand but you need to be able to evaluate your marketing efforts in a data-driven way because you can lose a lot of money really quickly. To me that is, thats what the third way of marketing is.” - Ben

• “AirBnB went and did all these high-quality photos. What if we took high quality photos of our hotels rather than taking the photos of the hotels, sent to us. What if we sent out photographers? What would that do to our conversion rate? So they ran a test. They got the results back and the hotels that ran the new photography, the conversion rate went down.” - Ed

• “The test control said, were done. Weve figured it out. But the manager said, wait a minute. That doesnt make any sense. Why would new, high quality photos make it worse? It made it better for AIrBnB. Whats about Expedia thats making it worse for us.” - Ed

• “So he went against corporate culture and dug in more. What he discovered is that there are two conversion points at Expedia. Theres the search results where you choose what hotels you want and then theres the hotel destination page where you decide if you want to book that hotel or not.” - Ed

• “Then on the second step, when people are actually in the hotel, these new hotels are converting higher. Conversion rates went up and thats where all the photos were. Theres only one photo on the listing page. So the problem isnt all the photos, its the photo were putting on as the flagship photo. Thats driving down the conversion rate, not all the others.” - Ed