Combating Saturation Marketing

Following in AOL's footsteps, a group of national ISPs is preparing to deluge the market with sign-up discs. Their target: Your customers.

by Kevin Beauchamp [August 17, 1999]

In surveying the ever-changing landscape of ISP services, it's clear that the big boys are suiting up for a huge new battle in the war to win customers this fall. They're assembling their best marketing generals and sales commanders and building up huge arsenals of cash to bolster marketing and implement new promotional campaigns. It'll be an interesting battle to watch for sure.

The main thrust of the fall battle appears to be focused on huge direct mail saturation campaigns moving millions of new signup CDs to anyone with a credit card and a pulse—a battle of who can outspend their competition. It is a strategy that, in my opinion, is not very strategic.

Just like competing solely on price, saturation marketing is another lazy—or perhaps more to the point, wasteful—way to market. Certainly cash is crucial to getting the message out and direct mail is definitely a good method of advertising and promotion. But looking closely, I don't see anything ominously strategic about what's happening with these companies' saturation-market planning. Let's take a closer look and I'll tell you why.

Follow the leader?
Back in 1993, America Online, with just over a half-million users at the time, launched a direct mail blitz, using a mostly scatter-shot approach, to lure new customers to their service. Within two years AOL had added more than 4 million new subscribers, and it has continued to build its massive customer base with direct mail disks—now CDs, of course. Back then, the concept of getting a disk in the mail was novel and unique. It made signing up very easy and there was a grand mystique about getting free software in the mail.

Today it is common, perhaps too common, to get free software in the mail. While still interesting to some, for many of us a software CD is just another piece of junk mail. AOL continues to saturate the market with CDs and win new customers. Note the operative word here—"new." Veteran and even novice users of the Internet typically aren't impressed with getting these disks in the mail, so most go into the trash.

Attempting to ride the wake of AOL's successful disc-mailing campaigns, MSN, MindSpring, EarthLink, OneMain, and other large ISP's appear to be ramping up their own AOL-like marketing campaigns and are preparing to flood the market with even more CDs. With so many national ISP's hitting the mail-trail with sign-up CDs, will smaller ISP have a tough time competing? Probably not—if you're prepared.

To a major extent, I certainly agree with the idea of direct mail; but in previous articles on marketing, I've discussed the necessity of building real strategies into a marketing plan and establishing what is known as a "competitive edge." Christopher Knight, in a recent article for ISP-Planet, What Makes Your ISP Unique?, points to this situation quite plainly with what he calls the "unique selling proposition."

I've already received an MSN CD in the mail. While it was chock full of shovelware (trial versions of Microsoft's already downloadable software) and had a neat little control panel doodad for navigating their service; it was basically the same tired old "me too" Internet service advertising we've all seen from every other national ISP. Sure MSN has unique content, but it's available to anyone on the Net with a browser. AOL is still the only online service with what could be called a real competitive edge or unique selling proposition. Their proprietary content and moderated online community are huge, unique, and quite valuable to many users.

go to page 2: Battle plan