Wednesday, January 4, 2012

should I spam?

At my last Barter Club dinner, I was buttonholed by Mike. "Bill, I have started a new business!" Well, Mike, you start a new business about once every two years. Whats this one about? "Well, we want you to provide a discount coupon (on line of course) which we will send to thousands of people and you will get hundreds of orders as a result. All we want is for you to provide content, and we will get it "out there" and of course, we expect a piece of the action.

This went on for awhile, as I tried to understand how this would be a sustainable business model. First of all, it certainly seems that there are many companies that are doing just that. As far as I can see, what I would get out of this is a pile of "leads". Thats ad man talk for "email addresses". Possibly targeted addresses in that it would include a pile of people that are actually interested in my product. Or more likely, people who are just interested in getting the best possible deal.

In other words, spam.

I dunno. I suspect that I would get a huge list of people who are looking for cheap stuff, instead of good stuff. I don't think I want to "deep discount" my work for ANY reason. It cheapens it.
I think this might work for hotels. I don't think it is a sustainable business model for hand made suits of armour.
What do the readers think?

ip-location map zoom


Ars.Gladius said...

Sounds like spamming a bunch of people, most of who will not be interested.

You would be better served to place paid advertising in targeted locations (medieval fares, sword forums, etc).

If they want an up-front cut of potential sales, it's a scam (even if they don't know it).

Out of curiosity, what level of discount were they suggesting to be offered?

STAG said...

Well, there was much more to it. For one thing, THEY provided the secure server, and THEY accept paypal and a host of credit cards that I do not. (This was a powerful hook right there!!!) That was how they knew how much the sales would be...they processed 'em. For that service, they wanted 25% of the action. Not so bad if they could deliver, however the only sales tool they are using is "deep discount sales". Which is to say, I would be asked to sell something resembling an on-line coupon for at least 50 percent off my advertised price. Also, you only get one kick at the cat per email address.
I see by my inbox that there are a LOT of companies out there who are doing just that...though I notice they tend to be companies which have less clearly defined profit-loss statements, like restaurants. A restaurant can take a five cent chicken wing, dose it with another five cents worth of Frank's hot sauce, ten cents worth of grease and heat, and sell it for seventy five cents. Increasing the number of bums in the chairs by loss leading the wings simply increases their beer sales, and gets people out of the habit of going to the competition.
My business model is not like that. But you know.....

Maybe it should be.

Damned if I know how to do it though!

Kit and Kaboodle said...

I think you should avoid it like the plague to be honest oh bearded one. We have a scheme called 'Groupon' over here (you might also have it there not sure?) which works on a similar principle which has caused no end of problems for smaller businesses. Large discounts being offered to generate interest that then can't be met or which incur huge losses for the businesses being targeted. I tend to agree with Ars.Gladius - that you should maybe target specific potential sale sites where your work will be loved and appreciated for what it is. Quality.

STAG said...

I tend to agree. I think if I really WANTED a targeted list of email addresses , I would go to my in box and get in touch with all the "happy customers" over the years.
(I think my "linked-in" has done this for me....grin!)
Which I might do anyway, if only to touch base with what amounts to old friends.
Good to hear from the delightfully talented and music loving Kit after all these months!

Ars.Gladius said...

Very GroupOnish. Many issues with that set up, can be very bad for small business to the point that it has killed many off.