October 16, 2001 Volume 1 Issue 21
"People are all exactly alike."
"There's no such thing as a race and barely such a thing as an ethnic group. If we were all dogs we'd be the same breed."
"George Bush and an Australian Aborigine have fewer differences than a Lhasa Apso and a Toy Fox Terrier. A Japanese raised in Riyadh would be an Arab. A Zulu raised in New Rochelle would be an orthodontist."
"People are all the same, though their circumstances differ terribly."
These rather outrageous words are from the author P.J. O'Rourke, written about a decade ago. Not in the middle of September past, as a result of terrorist action in the eastern USA. Although, they could have been original then and be just as accurate (the difference being the second George Bush).
So, have we in marketing and direct marketing made too much of targeting? Are we going to extremes with the gathering of data? Should we back off and not save knowledge about our customers? Should we treat all prospects and customers alike and let the privacy issue evaporate? Or, is "... their circumstances differ terribly", terribly important?
Because I've been around long enough to remember 3 cent first class stamps and postal codes of a single digit, phone calls that cost a nickel and telephone exchanges that began with a word (Pennsylvania 6-5000), and a time before everyone had a fax machine, let alone E-mail and the Web, change has been obvious. And most of it has been good.
At the same time, how many beyond the largest companies (only about 3% have 100 employees or more) can truly make use of extensive databases? There is really no answer to that question. Yet, I ask it, because weekly I meet mid and small business people who do NOT have a computer based database of their customers. And, "thank you", they are doing quite well in their marketplace.
A year ago I visited with the owner of a women's specialty shop. His dad had started the business 30 years earlier. The son grew up in and now continued the single location retail store in a 100,000 population city. He came to a database conference, because he'd heard so much about it. Thought a database was something he might need. To stay with it in this 21st Century.
Four months ago I see this same gentlemen - and ask how he's coming in building his database. He has done nothing. Zero. Zip. Nada. And my guess is he will not do anything. Why? Because, as he told me, he doesn't have time ... he's so busy with his customers.
He runs ads in the local newspaper. Participates in several of the towns special events. Belongs to Rotary. Attends his church. Keeps himself active in his community - and his store stays busy.
You see, he has a "database". It is in his head. Not unlike the butcher, the baker and the candlestick maker of centuries past. They all knew who their customers where - and which were better than others.
Could he do better with the names and mailing addresses of his customers? And a simple record of frequency of visits, amount they spend, things important to them? Probably he could, as "... their circumstances differ terribly". He'd know who to mail a special invitation offering an specific opportunity. When he puts that same message in his newspaper ad, it is nothing special to his customers. And thus, they are less likely to feel special. Even thou they are customers.
As I was growing up I recall seeing my mother (born in 1909, so you understand the timing) receiving personalized service at the grocery store. From her hair dresser. The dry cleaners. At the service station where she took her car. The owners / managers of these shops knew Mom - what she liked, what she did not. And they took care of her.
Even a short time ago big business did not have the knowledge they have available today. i.e., in the late '70s an airline from "down-under" was launching service from the west coast of the USA. Their database of North America customers who flew round-trip first class to somewhere in the South Pacific at least twice a year was several thousand names. With minimum info kept on 3 X 5 cards in a shoe box.
Today that same airline, and all their competitors, have extensive knowledge of their marketplace. Which they use to keep their best customers as best customers. We know them as "Frequent Flyers". Because "... their circumstances differ terribly", it is important to not treat all customers alike. They are not all equal, even thou they are all customers.
Since that time 20+ years ago we've come a long way - most of it in the right direction. Yet, really how important is segmentation to most businesses?
If your fine diner is at the corner of Spruce & Goose, your business is going to come from about 3 to 5 miles in a circle around your store. History has proven that over and over again and again. You are not going to change that much, no matter what you do, or do not do.
Ditto a fast food restaurant. A service station. A sports bar. A local bank.
For B-2-B the geography is different - and the marketplace is, too. As you're reading this I've just finished a session with a software company with very vertical products aimed at very vertical markets. Their distributors are sized from less than 10 employees to just about 100. Meaning, they think differently.
Sales reports may be on laptops - and expense accounts probably come off a financial package. Yet, most of their marketing is done broad brush; going to industry trade shows, sending "general" post card mailings, maybe a fax and lots of outbound telephone calls. A few are developing an E-zine. All get some word of mouth referrals and everyone uses tons of common sense.
Hey, they are not stupid. They know in the 1940s & '50s it was "the territory". Geography was it - you rang every door bell. The time following WWII were "The Confident Years". This lasted through most of the 1960s -- until Vietnam took over.
During the computer era of the 1970s and '80s it was the product and service. Benefits over features. The west specifically and the world generally was going through "The Tumultuous Years".
Then came "The Superpower Years" of the 1990s. When almost anything worked. You got up in the morning and you got business.
Today, early in the 21st Century, it is knowing the business. Yours, for certain. And your prospects. 'Cause if you do not you will not turn them into a customer. It is the time called "The Customer Years". And remember; "... their circumstances differ terribly".
So, is target marketing overplayed? Have we made too much of the database? No, I think not. Still, we need to add a touch of reality when we talk with small business. It's not reasonable to cut and dice and sort 16 ways from Sunday morning for many businesses. Even when "... their circumstances differ terribly".
In reverse, Pizza Hut can make use of a database - as many of us are creatures of habit. We tend to order the same style pizza every time. Direct Marketing techniques work for them.
The same approach does not work for Denny's - who make their mark successfully with "advertising" vs. marketing.
Big Wells Fargo bank can, and does go both directions. Lots of mass with outdoor posters and television, some radio, and a fair amount of newspaper. Magazines, special event sponsorship, too.
And, they are excellent direct marketers. They know the "average" USA household receives 900 pieces of direct mail a year. They also know if you're a customer of the bank at any level it is highly probable you'll open a piece of mail they send you.
They have several custom published magazines aimed at several highly selected audiences. As, again, they know these marketplaces, and "... their circumstances differ terribly".
They have ATM machines on as many corners as they can put them. They have mini-branches inside super markets and other off-site locations. They understand the value of E-mail marketing. They have a wonderful inbound telemarketing center. And they are online in a leading way.
Still, some of their best competition is a single location small community bank. Which does not have the resources to do 1% of what Wells does. These banks serve their audience the same way the grocer, the drug store manager, the pet store owner did with Mom - decades ago. Before targeting.
P.J. O'Rourke may have said it best; "People are all exactly alike."
Every E-zine issue will include a quote from the world's most famous philosopher ... Anonymous.
Here is the choice for this week;
"There are no failures . . . only lessons."
"Quotes with Direction" has been a part of my web site collection from day one. If you like quotes visit the archives ... www.rayjutkins.com/quotes/. There's a new batch up every 4 weeks.
Marketing Products to Buy
Time is a great teacher.
Along with mentors. The boss, fellow-workers. Friends. Just being around students at school, the members of a church, an association or club. The neighbors. Kids. By osmoses much sticks.
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