If you go online right now and look at business news websites, you will find a staggering amount of stories on how great digital media is, how Amazon and e-commerce initiatives are talking over the world, and the second coming of the digital revolution. To them, offline media might as well be dead.
And unfortunately, it only gets worse if you attend a marketing conference. There, you’ll listen to a dozen or more speakers trying to sell you on the idea that the only marketing that matters is social media marketing. All other marketing is defunct. Your path to quick profits is by advertising on Facebook — or the newest social media flavor of the month.
Do you want to know the truth?
They’re lying to you. I’m serious. It’s all a lie, and I’ll prove it to you.
Let’s look at e-commerce first. As of the fourth quarter of 2016, total e-commerce sales made up only 8.3% of all sales made in the U.S. That’s right. The death of the physical store is a long way away. Physical stores still account for 91.7% of all U.S. sales.
In addition, the pace at which online e-commerce is growing is starting to slow. Of course, 8.3% of the entire U.S. market is still a massive chunk. So, shouldn’t you get your piece of the pie? Yes, but don’t expect it to be a very big piece. The top 500 e-commerce sites made 84% of all total e-commerce sales. This leaves you and me with a very small, 1.3%, piece of the pie.
What About Online Advertising?
Online advertising is continuing to grow. It makes sense when you think about all the content being published and consumed on mobile devices — and all the time people spend glued to a screen.
This year, for the first time, online ad spending will overtake TV ad spending. But that comparison is a bit misleading. All online ad spending for any U.S.-based sites will overtake the single form of offline media that is TV advertising. That doesn’t sound like the death of TV. It sounds like hype to make online ad spending appear to have this “great victory” over offline media.
There are, of course, other challenges in online advertising. This mainly includes the shifting landscape and the ease at which people can skip your ad and get to the content they want to consume. Businesses that try to figure out what works today are wasting money. It’s not the ad that will work online tomorrow.
I recently had someone tell me they were getting these amazing lead costs through Facebook. I took a look at their numbers and asked if they were managing the campaigns themselves. They had hired an outside vendor, so I asked, “What does that vendor charge you?”
When they told me, “$2,500 per month.” I redid the math on their lead cost and included the vendor’s fees, which unfortunately burst the client’s bubble a bit. In the end, not adding in the vendor fee would be like doing direct mail and not adding postage as an expense.
In short, it can get unnecessarily expensive.
Offline Media Is Dead? Not So Fast
Do you remember when the media predicted the death of traditional books? TechCrunch published an article on August 6th, 2010. They predicted the physical book would die out by 2015.
Someone may need to inform Barnes and Noble, because I was in their store just this past Sunday, reading physical books. I even bought two of these fossils.
In 2015, e-books did not take over the publishing world. In fact, e-book revenue fell 11.3%, while hardcover book revenue grew 8.3%. The fastest growing segment of the whole book industry is audiobooks, both digital and physical. I, for one, listen to a ton of audio books each year. It appears the funeral for physical books may need to be postponed.
What about direct mail? According to the US Postal Service, 98% of U.S. consumers get their mail daily from this weird box at the end of their driveway. 77% check their mail immediately. People, young and old, still prefer to read on good, old-fashioned paper. 67% of consumers prefer offline media or print media over digital media. According to Super Office, people only open and read 20% of their emails, and although I don’t have a stat for this, let’s be real. No one enjoys the volume of emails they get.
According to the DMA Response Report of 2016, direct mail response rates grew tremendously over the last year with a 5.3% response rate to house lists and a 2.9% rate to prospect lists. They were the highest levels the DMA had tracked since 2003. And even so, they only continue to grow.
Direct mail works so well that even massive online forces like Apple, Google, and Facebook use it as part of their multi-channel media strategies.
What Should You Do?
Here is the truth. You have to do it all. I know that means making your marketing strategy more complicated. I know that means you may have to increase your budget. But the truth is, you need a multi-channel strategy. Doing anything less is way too risky.
Think about it. What if you’re all in on Facebook, but you lose access to your account? It’s happened to me and almost everyone I know in the marketing world.
Your marketing strategy should look something like this:
Start by focusing on fixing the holes in your bucket. This includes fixing retention issues, poor follow-ups, bad lead-to-appointment conversion rates, bounce back issues, and referral shortages.
Each business will have issues right now they should fix first. You don’t pour water into a bucket that has two giant holes in the bottom, expecting to fill it up. So why keep dumping good, expensive leads into your business if you haven’t fixed the holes in your bucket first?
After you’ve repaired your retention issues, you can add a multi-channel marketing campaign that includes online and offline media for new leads. This means Facebook advertising, direct mail or Google advertising, and event sponsorship. Add whatever is going to get you the best results for your business.
I promised you the truth in this article, so I’m going to end with another true statement — one that might not be palatable for some. Marketing is getting more and more difficult. You can’t simply hang a shingle on the door and announce you’re open anymore. You can’t simply put an ad in the Yellow Pages or the local newspaper and see a flood of business. Marketing and advertising has changed, and now it’s complicated.
For some, that creates a massive amount of stress and anxiety, and I understand that, but you need to look at it differently: Complicated marketing is beneficial marketing.
Think about it like this. If you invest and figure out how to create a profitable multimedia marketing strategy with online and offline media, you negate nearly all of your competitors. It is unlikely they are smart enough or patient enough to figure the strategy out.
The complexity actually becomes a massive competitive advantage for your business. And it also makes your business more valuable from a resale standpoint.
This leaves me with one final question that only you can answer: Can you handle the truth?