May 09, 2013

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Tumblr's Advertising Challenge The cool kids have abandoned Facebook and headed to Tumblr. Twenty-nine million unique visitors signed in four days each week to gain access to 44 billion posts on 102 million blogs. The average user logged-in for 154 minutes and looked at 30 pages per visit. One in eight used a mobile device to tumble. Tumblr users skew male, young (18-34), single, childless and rich (1/3 have household income greater than $100K). One in five is Hispanic and one in six is in the Pacific Time zone. Now that they’ve drawn a crowd, Tumblr is trying to figure out how to make a buck. They have a “Radar” feature, which highlights curated posts and is supposedly seen by everyone, although I can’t figure out which posts in my feed are the “Radar” ones. I checked my dashboard and couldn’t find an ad even though they sell access at a minimum of $25,000 a pop. Supposedly, a bunch of well known brands have used the platform. But I’ve never seen hide nor hare of them, nor do I follow any of them. Maybe they appear in the 50-odd content categories that range from Actors, Cute and Gaming to Poetry, Street Style, and TV. They’ve also rolled out a mobile ad unit, initially embraced by GE, Warner Brothers and ABC, that is served four times each day in their iOS and Android app. And they insist that ads appear as posts rather than as ads. I’ve never seen one of these puppies either. Buying Tumblr for brands is a challenge. Blog content is highly visual and idiosyncratic. Like Facebook users only see content from those they follow. Unlike Facebook you can follow anyone without his or her blessing. So brands will have to develop significant followings to get substantial reach and or frequency against desirable segments. The content categories aren’t channels per se just convenient ways to find blogs to follow. And they don’t reflect anything by a tiny selection of the 102 million blogs. Brands can’t frame up appropriate messaging because there is no common experience. Each of the 29 million users follows a different set of bloggers for 29 million different reasons and nobody has crunched the numbers to determine what the patterns and affinities might be. The other consideration, beyond advertising competition from Facebook, Twitter and LinkedIn, is an undefined user experience and customer expectation set. Brands need to know why people use Tumblr and how either the people and their moods and behaviors differ from the other social networks. And we haven’t even started to talk about qualifying the audience or determining product and service use. It’s hard to imagine running contests, begging for Likes or distributing coupons to this crowd on this platform. So what’s a brand to do? As a focus group of one, for me Tumblr is a diversion; a time waster filled with startling images of people, places and things that I don’t see on Facebook. The 111 people I follow (fewer than the 133 average number of Facebook fans per user) post historical documents, travel shots, photography, cartoons, landscapes, portraits and very little copy. Posting short essays, I’m generally in the minority. And unlike Facebook, I don’t follow any brands and I don’t know or care how many followers I have. It’s a semi-private, self-constructed universe, where intrusive ads would be unwelcome. Tumblr faces the classic social media paradox. They’ve developed a sizeable audience but they can’t yet package it and sell it to advertisers. And if they do, will Tumblrs hang around and take in the ads or will they defect and be off to the next cool thing?
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4 Latest Loyalty Marketing Strategies Marketers have been manufacturing consumer loyalty through rewards and loyalty programs since the 1970s. The average American belongs to seven programs and 7 out of 10 are willing to join more programs. Most of us sign up for rewards from airlines, credit cards, grocery stores, gas stations, favorite retailers and a hotel chain or car rental firm. A third of most programs have members who have defected in-place without formally cancelling. Forty seven percent of respondents stopped participating in one of their programs in the last year. And yet in spite of competition and attrition, fifty-seven percent of respondents say they modify when and where they buy to maximize loyalty benefits. Forty-six percent say their choice of brands is a function of optimizing reward value. Loyalty marketing is personal, fickle, schizophrenic and well worth doing. Building and sustaining loyalty is tricky. Its part stimulus-and-response conditioning, part value exchange and part emotion or experience driven brand love. The dynamic mix of these rational and irrational elements in the context of larger macro economic factors, like a recession, or micro factors, like an awful experience with a store clerk, can change quickly. What looks valuable today; is piddling tomorrow. Too often the experience of trying to redeem points or miles is so frustrating, infuriating or just plain unfair that it destroys the rationale for collecting them. On the other hand a free trip, automatically applied coupons or discounts that yield free groceries or a first class upgrade can be sublime. Enter Maritz Loyalty Marketing who recently published its first US Loyalty Marketing Report, under the leadership of Scott Robinson and Bob Macdonald. They surveyed more than 6000 people in 30 national loyalty programs across six industry sectors. Here are the 4 key drivers of loyalty program satisfaction they discovered. Relevant Communication is Critical. Duh! While more than 9 out of 10 members want to hear from their loyalty programs only half (53%) see the communications are relevant. Fifty-seven percent of members read everything they get from their rewards programs while just 12% say it’s too much. Everybody wants to know the rules, the news and what’s in it for me. Duplicate Channels. Almost all participants (96%) want communication and almost half (46%) want it in at least three channels. Seventy-three percent want their mobile device to interact with their loyalty programs. But only a third (37%) see mobile as their primary loyalty channel. These are the people most likely to download loyalty apps. Loyalty loyalists want their communications on their terms and they want a choice of access points that they direct. Finesse the Cool-to-Creepy Spectrum. Sixty nine percent like and want personalized offers based on purchasing habits. These are the “do it for me” people. Sixty-two percent prefer to drive themselves. They want offers based on preferences that they manage. Both groups want rewards earned and applied to the stuff their care about most. Some consumers feel understood and appreciated when offers are based on their attitudes or behaviors. Others are entirely creeped out by the experience. Loyalty marketers need to segment participants to find the right balance and test the information-for-value exchange to determine consumers tolerances. More than a quarter (29%) of participants think programs require or acquire too much information prompting privacy concerns. There’s a built-in paradox here. If program satisfaction is a function of relevance and data collection drives relevance; without data you are doomed. If you don’t collect and use the data, you risk developing programs and content that nobody cares about. That’s probably why in spite of generalized privacy concerns a majority of Americans still trade personal information for relevant offers. Don’t Discount Values. On some level, loyalty is about brand awareness, preference and advocacy. Don’t let CRM tactics fool you. There is a strong link between personal values and brand values. Forty percent of those surveyed see their favorite brand’s values as “the same as mine.” People who see themselves in alignment with a brand’s values are much more satisfied with loyalty programs. This is classic branding strategy. Successful brands mirror image the personality, values, voice and tonality of their best customers. Loyalty marketing needs to focus much more on content and messaging to resonate with program participants. Its probably time to let consumers into the tent and ask them to co-create content and tactics that reflect who they are and what they believe in. In a plugged-in, on-the-go, ADD society, loyalty is a constantly shifting bogey. Yet this new data offers some insights, approaches...

Danny Flamberg

I am a veteran marketing consultant working with leading and emerging brands

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