A Short Lesson in Quality Advertising

“Sincerity is not only effective and honourable, it is also much less difficult than is commonly supposed.” – George H. Lewes

You might be surprised to know that I rarely see the advertisements that appear in ETR before they are published. As the founder and first author of this e-zine, shouldn’t that be my responsibility?

Yes and no. I do feel a responsibility to improve the ads we run – and by “improve,” I mean to make them better for our readers. The cynic will believe otherwise. He will suppose that my only interest is in seeing those ads “pull better,” i.e., to achieve a higher response rate and thereby add more money to ETR’s bottom line. But the truth, is I am not worried at all about ETR’s bottom line, because long ago I handed over the profit management responsibilities to other people.

Today, ETR is run by MaryEllen Tribby, a powerhouse business builder and marketing expert. MaryEllen, working with the super-terrific ETR staff, is doing a great job of growing revenues and putting a good percentage of them on the bottom line. So with MaryEllen and the ETR marketing team focusing on input, I can pay attention to output. And to me, that is entirely governed by how good and useful ETR readers find our products and services.

The Hypey vs. Less-Hypey Question

When you are in the direct-marketing business, there is a strong temptation to boost sales by hyping the product you’re selling with sensationalistic language. The temptation arises not from the schlocky hearts of direct marketers but from the experience of testing hypey copy versus less-hypey copy.

As it turns out, a fairly large number of our marketers have no business background when they begin. Instead, they come to us – to ETR and Agora – with liberal arts degrees and ambitions to become historians or philosophers or musicians or ecologists. So whenever we do a hypey versus less-hypey test, both I and these young do-gooders hope that the less-hypey copy will prevail. But it seldom does. Otherwise intelligent and sensitive readers consistently make buying decisions based on over-the-top promises and cliche-laden language over more reasonable copy.

Since we like to think that the testing and analysis part of direct marketing is a strictly scientific business, we reject the counsel of our inner brain when it tells us that hype is wrong … and we go with the hypey version of an ad because the test “told us” our readers prefer it.

As I’m sure I’ve mentioned before in ETR, I’ve been involved in such tests at least 100 times, and in most cases the hype won. I didn’t want it to be so, but it was. Being a dutiful direct-mail scientist, I “listened to the market” and wrote – and taught others to write – hypey headlines and leads for ads. They worked. But I never felt good about them.

The Highlander Club Experience

Then, a few years after I started to work with Agora (and perhaps because of it), I started to develop a different idea. The idea came from an experience I had with a business we called The Highlander Club.

The Highlander Club was meant to appeal to the business- and income-opportunity marketplace. Sandy Franks, Nina Rose (now gone – a great tragedy), and I wrote the promotions for it, and we had great, fast success. By coming up with clever products and promoting them to our Highlander Club members with unrestrained copy, we were able to grow from nothing to $5 million in sales in less than two years.

And the company was very profitable – at least for those first two years. We grew again the third year – we might have reached $10 million, if I’m not mistaken – but our profits disappeared. The next year, we struck gold with a great new product, and the profits were back. But the following year, there were big losses.

We were working very hard and the business was growing. But after five years, on an accumulated basis, we hadn’t made any money. What went wrong?

One theory was that our Highlander Club members were not “quality” buyers. (When direct marketers talk about “quality” buyers, what they generally mean is how much money those customers are willing to spend on products sold through direct marketing.)

Compared to other Agora divisions, Highlander Club members were indeed very low-quality buyers. Their average lifetime spending was about one-fifth that of Agora’s typical investment/financial product buyers. But when I looked at their actual history of buying, I noticed something curious: Many Highlander Club members were buying very well during the first year of their membership … but over time, they bought less and less. Also, when I looked at the segment of membership that had migrated to us from the Agora financial files, I could see that they were spending much less with us than they were spending with other divisions.

Why were otherwise good “quality” customers spending less with us than they typically spent? And why did they become more reluctant to respond to our ads with time?

The answer, of course, was that we were recruiting perfectly good people into the Highlander Club with some very strong promotions that promised lots of very good things. But after they became members and began to experience those benefits, they found us long on hype and promise but short on usefulness and sincerity. In other words, we began a relationship with promises we weren’t keeping – and we eventually got our just desserts when our members stopped responding to our ads.

They just didn’t believe us any more.

An Important Discovery About Long-Term Profits

Despite record-breaking growth, we were forced to close The Highlander Club because it couldn’t make consistent profits. Although I was disappointed to see something that I’d helped start come to an end, I was extremely excited by the discovery I’d made: that short-term, direct-marketing results don’t necessarily determine long-term profits.

This is such an important secret – and is so widely unknown in the direct-marketing world – that it bears repeating: Short-term marketing results don’t necessarily determine long-term profits.

The reason is simple. Your customers may initially be responsive to bells and whistles, but in the long run what they want from you is honesty, sincerity, integrity, and value.

Yes, you can make quick bucks in the direct-marketing business by bowling your customers over with inflated claims and exaggerated promises and hyperbolic language – but those bucks won’t keep coming once they figure out who you really are and what you’re really up to.

I was very happy to have come to this noble perspective, even if it took me 15 years longer than it could have. It made me feel free to promote what I always secretly wanted to promote: less hype and more value!

Not everyone buys what I’m selling now, because the test results still continue to favor the hypey copy. But since I’ve been looking at my businesses in this light, I’ve noticed that the ones that have done the best over the long term have been those where the editorial and marketing copy have been consistent in terms of the promises made and the way the promises are expressed.

The businesses that are today enjoying very high profit margins and steady growth (after super-strong early runs) are those that spend most of their creative time trying to deliver better, more useful ideas.

Good writing, as any longtime ETR reader knows, is good ideas simply expressed. If you want to be a successful information publisher for the long term, you must become an expert at developing good and useful ideas, not overwhelmingly seductive advertising.

That’s My View. Now … What Do You Think?

We can – and surely will – continue to talk about this subject on an ongoing basis in ETR. If you have comments or questions about it, I’d like to hear them.

On my blog, I’ve posted two memos that I recently sent to the ETR marketing team – one about a recent ETR advertisement that I found to be hypey and insincere, the other about an ad that I thought was pretty good.

Read the ads and the memos … and let me know if you agree or disagree with what I said.

[Ed. Note: This April, Michael Masterson will lead 25 to 50 ambitious businesspeople through an elite 5-day program that can help dramatically increase the profitability of their businesses. He’ll reveal more than 100 ways you can increase your profits through direct marketing, the Internet, advertising, public relations, networking, front ends, back ends… You name it, he will find a new and better way for you to profit from it. Learn how you can be a part of this exclusive group and take your business to the next level.] [Ed. Note: Mark Morgan Ford was the creator of Early To Rise. In 2011, Mark retired from ETR and now writes the Palm Beach Letter. His advice, in our opinion, continues to get better and better with every essay, particularly in the controversial ones we have shared today. We encourage you to read everything you can that has been written by Mark.]