Think Customers: The 1to1 Blog

For most mass marketers, "scale" means the ability to use a few basic advertising tactics like TV, print, radio, and Sunday coupons to reach millions of customers at once. According to this most basic hypothesis in the marketing textbooks, the more eyeballs your message reaches, the more people will notice it, and the more people will buy your products or services. This is the dogma of the marketing profession, and this belief leads businesses to buy media impressions by the millions at the lowest possible cost-per-thousand. Unfortunately for us believers in relationship marketing, it also means that our work is discounted when we show "only" thousands of customers in a database.

But the ability to achieve mass scale and belief in the power of the interruptive marketing model is rapidly breaking down before our eyes. The main reason is that customers are no longer consuming media together in scale numbers. They now have hundreds of channels to watch on television alone, and are increasingly dividing their attention among new media alternatives like DVDs, iPods, and Facebook--most of which either lack advertising completely or were not designed to steal uninterrupted attention for 30 seconds at a time.

Marketers who continue to insist on this traditional mass-impression model have been forced to invest much more time and money placing messages than in the past. They are spending more than ever to hit the few remaining scale audiences at events such as the Super Bowl and Olympics, and they are putting ad messages everywhere from virtual billboards on video games to painting logos on airport landing strips.

What too many marketers have forgotten or failed to realize is that their most important customers never were the masses. First, nearly every business has a tiny slice of its customer base that generates the vast majority of sales. A study of CPG brands by Catalina and the CMO Council found that, on average, only 2.5 percent of customers account for 80 percent of sales. In financial services, a study by Banking Strategies found that 150 percent of profits are derived from just 20 percent of customers. Every business leader I have come across admits they have an "80-for-20," but most fail to focus their marketing efforts on who really counts.

On the other hand, a growing handful of large and small companies are embracing a new path by putting more of their dollars against fewer customers, and they are investing in ways to add value to their lives through both old and new media. For example, Samsung is providing free phone and laptop recharging stations at airports. Charmin has set up clean restrooms for tourists in Times Square. Kraft is selling an iPhone app with hundreds of recipes and instructional videos. And Steelcase is providing training materials for office managers to help them understand their new Gen Y workforces.

These brands and many others have discovered that in a world where the competition for customer attention is rising radically, efforts to buy impressions through interruptive advertising will fail. The only choice for businesses is to create marketing that people choose to engage with, and advertising that itself adds value to people's lives. I call this new model "Marketing with Meaning," and it offers a path a new way to truly connect with a brand's most valuable customers.

Programs like these befuddle marketers who are used to thinking in mass numbers, but companies that commit to this model are enjoying greater success with fewer impressions and more real engagements. Nike, for example, was once an annual advertiser in the Super Bowl, which reaches an audience of over 100 million people in the U.S. alone. But it recently began investing these dollars to create digital coaching services for a comparative handful of shoe buyers. Its most popular tool, Nike+, a service that uses a special device to track each run, has barely over 1 million users worldwide. The company discovered that it can make a lot more money by regularly engaging a core group of loyal users with added-value marketing, rather than just telling 100 million people to "Just do it." It may seem nutty to a traditional marketer, but Nike used this tool to increase running shoe share from 48 percent in 2006 to 61 percent in 2008.

Although it is a break with everything most of us learned about marketing in our careers, Marketing with Meaning is a step back to the future in many ways, channeling a time when personal relationships and social norms came before today's predominant tell-and-sell customer churn approach. When marketing executives choose to stop interrupting the masses and start providing meaningful marketing to their most valuable customers, the results are short-term sales gains, long-term loyalty, and more meaning for everyone involved.

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About the Author: Bob Gilbreath is Chief Marketing Strategist of Bridge Worldwide, and author of the new book The Next Evolution of Marketing: Connect with your Customers by Marketing with Meaning. Contact him at b.gilbreath@bridgeworldwide.com