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Broadband Messaging & Permission Based
Marketing
Building a successful marketing and subscriber information system
using broadband messaging
By: Bruce Bahlmann - Contributing Author (your
feedback
is important to us!)
Created: April 9, 2004
This paper is the product of
Broadband
Market Research which is available from Birds-Eye Network Services.
As a provider of broadband services, how do you market changes or
additions to your services to your existing subscribers? When I think about
how much money is spent on marketing new products and services to existing
subscribers, a voice inside me seems to keep asking why? I’m not talking
about finding new subscribers, certainly that money is necessary, but I am
talking about the money spent attempting to market services to existing
subscribers. In this article, I will review the challenge that providers of
broadband services face in marketing their wares to existing subscribers as
well as convey one possible strategy that providers might explore as they
continue on their journey towards new fields of revenue opportunities.
“If you build it they will come”
The telecommunications industry in the US has spent billions of dollars
upgrading their infrastructure to support broadband services. The second
round of spending to expand these same lines has just begun and promises to
deliver increasingly more bandwidth to homes and businesses while supporting
an increasing array of new services. However, building service
infrastructure and adding new services to it is one thing but attracting and
keeping actual subscribers as well as educating them about the availability
of new services is something all together different.
Last year, one of the largest telecommunication's providers spent over $1
billion on advertising alone. This advertising included various radio,
print, and television ads. What does not get attention among the Wall Street
types is how well providers of broadband services effectively market and
sell new/additional services to existing subscribers. These costs are
generally hidden operational and sales expenses. For example, one mechanism
to attract subscribers to expand their subscribed services is to insert a
coupon for a new service into an existing subscriber’s monthly bill. Another
mechanism is to go door to door and sell your new services to certain
existing subscribers. If all else fails, there is always the telephone or
email but at that point you have generally committed quite a bit of expense
in up selling any one subscriber.
“Is this heaven? [no] its Iowa!”
 The
reality of various advertising and sales campaigns is that successes are
generally measured by single digit increases in sales or take rates. For
example, a successful advertising campaign boasts only about a 2-5% success
rate. Interestingly, companies will often attempt to up sell subscribers to
additional/other services using multiple means to reach out to these
individuals. The problem is, they don’t stop there. This is a regular (often
seasonal) occurrence. For example, “snow birds” represent seasonal
subscribers as they stay summers in northern US states and then relocate to
FL or AZ for the winter. Like snow birds, subscribers will also flock to the
best deal, so it is up to service provider marketing to target those
individuals most likely to change their mind or perhaps subscribe to new
services. Essentially, marketing and sales represents a never-ending
process.
The other reality of marketing and advertising is that once you buy it,
advertising runs its course and then it’s done. Meaning, if you want to
perform it again, the cost and effort to set it up must also be repeated.
While it generally does cost less to repeat the same advertisement over and
over, the reality is that each advertisement attempts to capture the
interest and mood of potential subscribers with the goal to trigger a
change. Essentially marketing and sales attempts to get people who are not
thirsty come to the well to drink.
“Ease his pain”
Providers of broadband services sit atop a powerhouse information network
– a communicator for speaking to the very individuals responsible for their
survival. The problem is, few providers have really tapped into the actual
power that broadband connectivity with their subscribers enables. Some
notable attempts include the infamous portal, bulk or mail-merged email to
subscribers, or even pop-ups generated by various forms of web-proxies.
Other than the portal, all these attempts fail miserably at generating
consistently desirable responses from subscribers. As a result, marketing
and sales to existing subscribers has been associated with some pretty
negative terms such as annoyance, SPAM, intrusion of privacy, junk mail, or
just a waste of time. But how can one effectively market and sell services
to existing subscribers without being hung up on or deleted?
The answer lies in broadband messaging. The basis of broadband messaging
is very simple - provide people something useful that they can rely on to
obtain important messages. I’m not talking about some continuous infomercial
for everything under the sun that you sell. Rather, I’m talking about
critical information that everyday people want to know. An example of this
kind of critical information may be a brief message from the president of
your country to its citizens. While that very message may be similarly
broadcasted over the television or radio, subscribers with messaging can be
similarly advised on their computer and/or pointed to where they can go for
further information if desirable. Other critical messages may be related to
important service announcements such as notification that your email server
is currently down, but will be back in service at a stated time.
Providing useful information to broadband subscribers without any threat
that the medium is exploited to advertising sounds pretty compelling. With
each critical message accessed, subscribers are encouraged to “opt-in” to
other critical message services – for example traffic alerts, amber alerts,
weather alerts, city or local government alerts, as well as your companies
new offerings! Other non-critical messages may also be “opted-in” including
school closings, regional or local event announcements, state or local
government policy news, US senate or house progress on specific legislation,
special offers, new service free trials, contests, paid/free surveys, etc.
The array of information choices is there for the taking, but today,
broadband subscribers have to go find it rather than enlist (opt-in) the
content to come directly to them.
“What’s in it for me?”
 Upon
this basic framework of critical and customized informative messages, lies
the significant carrot for broadband service providers. Essentially,
broadband service providers sit atop the potential to become the largest
permission based marketing system the world has ever known. What is
permission-based marketing? It is a system of many different messaging
sources (or streams) brought together into a type of messaging switchboard.
From this messaging switchboard, broadband subscribers can plug-in
(“opt-in”) to any one (or more) of many different messaging streams. Each of
these streams can be individually managed (“filtered” and “routed”) at the
server or by client side enabling broadband subscribers to easily trim large
numbers of messages down to a very consumable and “manageable” number. The
result of such a messaging system is highly sought after presence for the
broadband service provider in the eyes of their subscribers.
The way I see it, broadband messaging is a sane lane to the “information
highway” that all broadband service providers need to be on. It is not a
matter of value-add but survival for all broadband service providers today
as they struggle with the notion of “Am I a dumb pipe or am I an information
service.” While you struggle to convince subscribers to adopt your new
service offerings, your competition could be getting de-regulated in route
to increasing their presence in the lives and businesses of their
subscribers.
“People will come, yes, indeed, people will definitely come”
The beauty of broadband messaging is that
it continually encourages subscribers to “opt-in” to an increasing array of
news brought to their electronic doorstep. The convenience of such a service
can be compared to that of your daily newspaper, except this newspaper is
completely electronic, allows an a la carte selection of only the news you
want in the format or to the electronic end point you want it delivered.
It also provides the much needed communications link to subscribers that
most broadband providers seek. Without this link, your only communications
with your subscribers may be your monthly billing cycle. If that is it, your
fields of revenue opportunity may hinge on your ability to keep your
customers happy when all they see of you is when they write out the bills at
the end of the month.
Check out these other Birds-Eye.Net papers/products regarding
broadband:
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