Geeks and Shrinks

May 8, 2008

Plugging the holes

Filed under: Customer dialog, Reputation — Tags: , , , — rvenkate @ 10:20 am

Mark Brownlow writes that “email marketing is like trying to fill a bucket with holes in it,” and describes the two schools of thought on how to solve the problem – either fill the holes (better retention), or use more water (faster acquisition).

In my experience, it’s not limited to email marketing. The “new economy” forces companies to make a choice – either supply superior products designed based on deep customer understanding at the best price, or move to a commodity business and supply products at the lowest price through those with deeper customer relationships.  The former requires a sustained trustful brand relationship, and (surprise) fits best with better retention, rather than faster and faster acquisition.

There’s another aspect to consider: good advertising inventory (online or offline) is scarce, and as a result the real price has tended to increase, even online. If a marketer pursues the “faster acquisition” path, is it sustainable under these conditions?

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