Here’s the framework I am working on … as I learn more, I reserve the right to change the framework.
My hypothesis.
- COVID changed how marketers “market” to customers, teaching a generation of marketers how to use a fusion of video and community (which both existed prior to COVID) increasingly fueled by AI (#tiktok) to sell to customers who “trust” those making the content.
- As more brands become good at Customer Media Marketing, response leaks out of Direct Response Marketing and Brand Marketing, causing those disciplines to become less effective.
- As Direct Response Marketing becomes less effective, more brands attempt to get the clicks that remain, driving up costs in a discipline that is simultaneously becoming less effective.
- Direct Response Marketers, instead of embracing Customer Media Marketing, embrace Product Marketing channels like Marketplaces (i.e. Amazon), where they continue the tradition of paying a nominal fee for access to customers … ultimately transitioning from being a Direct Response Marketer to being a supplier for a Marketplace. The Direct Response Marketer becomes the “Dries Van Noten” to Nordstrom.
Obviously, Direct Response Marketing isn’t “dead” as a small number of pundits might say. Rather, this is the end of an era. At some point, Customer Media Marketing will become too crowded, and a newer and more relevant version of Direct Response Marketing will emerge. But for today? Change is in the air.
Why do I think change is in the air?
When I analyze your data, there are clear trends, trends that accelerated post-COVID.
- Loyal Customers generally have similar repurchase rates over time.
- All other Customers generally have lower repurchase rates than they had in 2015-2019.
- Regardless of Direct Response business model, it is becoming VERY difficult to acquire new customers at a reasonable cost.
As a commenter said to me on LinkedIn … “YouTube is now the primary lead gen source for many businesses”.
Once you see this … and then see the connection to Community and Action Streams (capturing customer interactions like visiting your forum or website … then sending streams of emails to customers based on their forum/website activity) … you realize that a chunk of activity that used to reside in Direct Response now resides in Customer Media Marketing.
This evolution has been happening for the past five years … we’re just noticing it now.
