My Favorite Online Marketing Tactic — Doesn’t Work
That’s a pretty safe prediction for two years from now. I’ve seen many hot online marketing tactics lose their effectiveness over the last decade.
The key cause: Online tracking makes it easier for marketers to quickly figure out what actually works. As a result we start piling into the most effective tactics. Eventually they get saturated. An equilibrium is reached where most of the big profit potential is lost. SEM (Google Adwords) is the best example of this. A few years ago I was able to spend 7 figures per month on SEM with a tracked payback of three months. Today very few keyword categories offer that fast payback at any kind of meaningful scale.
The other reason that popular tactics fade so quickly is that popular tactics generate a lot of noise. Potential customers start tuning out the whole channel as it gets cluttered with advertisers. In the late 2000s, I used to get 20X higher click through rates on banners than what’s typical today. There were several months in the late 90s where I ran the most viewed banner on the entire web (according to Nielsen Ratings). Today banners rarely appear in the marketing mix for my startup clients.
And now it appears Facebook apps are quickly fading as a viable marketing channel.
So what can startups, marketers and VCs do to combat the short shelf life of online marketing tactics?
Advice to Startup CEOs:
Don’t pay a premium for a marketing veteran’s many years of tactical online marketing experience — only the last couple years really matter. And most of the critical go to market projects are very different from traditional marketing functions.
In fact I generally encourage startups to hire a complete rookie. The marketing leader is one of the most challenging roles for a startup to hire. The best marketing vets are looking for startups that have a bit of “wind at their back.” It’s the rookie that can create this momentum. Their lack of experience often means it’s easier for them to adopt new effective tactics as well as concentrating their efforts on the pre-tactical projects. In exchange for coming in early, give them a legitimate shot at the long-term marketing leadership role. After a year they will be intimately familiar with your customers. And they will likely be every bit as effective as a veteran marketer but available for a fraction of the equity and cash.
Finally encourage your VCs to hold regular marketing summits so your marketer can trade effective customer acquisition tactics with other marketers (share “Advice to VCs” below with your VC).
Advice to Marketers:
Don’t specialize in a single tactic. This is counter to the advice of most people, but hopefully by now you understand the flaw in focusing on a single tactic. They fade too fast and then you have to start building a new specialty.
Instead, focus on developing marketing skills that will always remain relevant. These include things like marketing psychology, diffusion of innovation, company building, customer research methods, persuasive website architecture, actionable marketing metrics… Stay on top of the latest tactics, but always balance this with developing expertise that will remain important in the long term. And when you discover effective new tactics, really analyze them to understand why they work. Those principles will remain important and will help you create/spot the next effective tactic.
And encourage your CEO/VCs to arrange marketing summits with other startup marketers where you can learn from each other (and please invite me).
Advice to VCs:
Encourage your portfolio companies to exchange their most effective tactics. Most VCs get their CEOs together, but rarely do I hear about VCs bringing together their marketing leaders (mine never did in any formal way). Marketers probably have much more relevant insights to offer each other than CEOs. Effective online marketing tactics are surprisingly effective across different business categories. The collective insight across your portfolio of what works is enormous.
I recently attended one of the rare marketing summits at a VC and found it to be extremely valuable. Expertise in the group ranged from viral marketing to creative ways of generating press. I was happy to share my insights at no cost — well actually in exchange for their insights. I also shared some of my tools/projects that can be leveraged to get better results out of every tactic. I’m sure the other marketers would agree that it was an extremely valuable use of a few hours of our time.