Permission marketing

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Permission marketing is a relatively new term, which was coined and developed by the entrepreneur, Seth Godin.[1] Traditional methods of marketing often revolves around the idea of attracting the customer’s attention away from whatever they are doing – whether it is a television advert that cuts into a TV show, or an internet pop-up that interferes with a website. According to Seth Godin, such traditional methods of advertising (often referred to as “Interruption marketing”), has become less effective in the modern world, where information is overloaded.[2] Therefore, Godin has developed the idea of permission marketing. Permission marketing is the opposite of interruption marketing; instead of interrupting the customer with unrequested information, permission marketing aims to sell goods and services only when the prospect gives consent in advance to receive the marketing information.[3]

Opt-in email is a prime example of Permission marketing, where Internet users sign-up (in other words give permission) to receive information about a certain product or a service.[4] Supporters of Permission marketing claims it to be effective, as the potential client would be more interested in an information that was requested in advance. Furthermore, it is also more cost-efficient in comparison to the traditional methods, as businesses will only need to target consumers who have expressed an interest in their product.[5]

Permission marketing vs. Interruption marketing[edit]

Interruption marketing is essentially a competition to win people’s attention. Thirty years ago, when the internet was not as common, it was relatively easier to win people’s attention. However, in today’s world of mass-marketing, people are consistently overloaded with adverts that compete for their limited time and attention span. The average consumer is said to come into contact with 1 million advertisements per year – which is nearly 3000 per day. When there is an overflow of interruptions, people’s inevitable response would be to disregard them, tune out, and refuse to respond. Such traditional methods of marketing has thus become more difficult and costly – increasing the number of exposures will be required to attain the same outcome.[6]

Permission Marketing in contrast, offers an opportunity for the consumers to agree to be marketed to. By only targeting such volunteers, Permission Marketing assures that the consumers pay more attention to the marketing message. Permission Marketing thus encourages consumers to engage in a long-standing, cooperative marketing campaign.[7]

The 5 Levels of Permission Marketing[edit]

From the lowest to the highest effectiveness, there are 5 levels of permission in Permission Marketing.

  1. Situational Permission: The prospect permits the business to come into contact by providing their personal information.
  2. Brand Trust: The prospect permits the business to continue supplying their needs.
  3. Personal Relationship: The prospect’s permission is granted because of a personal relationship that he/she has with someone in the provider organization.
  4. Points Permission: At this stage, the customer has agreed to receive goods or services and has allowed the business to collect their personal data. This is usually because they are provided with incentives, such as exchangeable points or an opportunity to earn a prize.
  5. Intravenous Permission: The supplier has now taken over the supply function for a specific good or a service; the customer is completely dependent on the business.

At each successive level of the permission framework, the business achieves a higher efficiency state, with a decrease in the marketing cost. Thus, businesses usually aim to achieve the “intravenous permission” level. However, the 5 levels of permission should not be considered as a necessary sequential process, as more than one level could apply simultaneously depending on the nature of the business.[8]

Examples of Permission marketing[edit]

After Permission Marketing was first introduced in 1999, as of today, it has inspired a large number of firms and companies to establish permission-based marketing agencies, campaigns, and platforms. It has also largely contributed to the development and the expansion of the social media, which heavily utilizes the methods of permission marketing; “friending”, “liking”, and “following”, all closely associates to the idea of Permission Marketing. Facebook is a prime example – whether it is to post, to share, or to amplify, the marketer would have to send a friend request (or a permission) to the potential prospects.[9] Other notable examples of permission marketing are listed below:

Huffington Post[edit]

Huffington Post is an American online news aggregator and blog which offers original content including the areas of politics, business, entertainment, environment, technology, etc. The Huffington Post has a clear permission marketing-based approach; the readers will be required to register on the site using their social media (such as Facebook, Twitter, etc). The registration implies that readers have given the permission for Huffington Post to send them with marketing information, such as their newsletters.[10]

YouTube[edit]

YouTube is a video-sharing website which enables its users to upload, view, and share videos. Many firms utilizes YouTube as part of their social-media marketing strategy to promote their products and services. Firms specifically make use of the “subscribing” feature to establish a permission-based relationship with their customers. Subscription would imply that viewers have given permission for the business to market them with updated information, campaign, etc.[11]

History[edit]

Permission marketing was first publicized in Seth Godin’s book, “Permission Marketing: Turning Strangers into Friends and Friends into Customers”, published on May 6, 1999. Seth Godin is the founder of the Yoyodyne Entertainment, and his experience as an entrepreneur was what cemented his idea of Permission Marketing. He witnessed that successful campaigns were the ones that first sought for customer’s consent. From such observation, Godin believed that marketing strategies should be based on the following elements – “anticipated, personal, and relevant”. The three elements were then put together to define Permission marketing.[12]

  • Anticipated: people will anticipate the service/product information from the company.
  • Personal: the marketing information explicitly relates to the customer.
  • Relevant: the marketing information is something that the consumer is interested in.

Benefits and Limitations of Permission Marketing[edit]

Benefits[edit]

  • Cost Efficient: Permission Marketing employs low cost online tools – social media, search engine optimization, e-mails, etc. Furthermore, by only marketing to consumers who has expressed an interest, businesses can lower their marketing costs.
  • High Conversion Rate: As the targeting audience are those who has expressed an interest to the product, it is easier to convert the leads into sales.
  • Personalization: Permission marketing allows businesses to run personalized campaigns; it allows them to target specific audiences according to their age, gender, geographical location, etc.
  • Establish Long-Term Relationships with the Customer: Through the usage of social media and e-mails, businesses can interact and build long-term relationships with the customers.
  • Maintains Marketing Reputation: Unlike Interruption marketing where consumers are bombarded with marketing messages, Permission marketing only sends information to those who are anticipating the information. Therefore, prospects who receive the information do not feel discomfort.[13]

Limitations[edit]

  • Though supporters of Permission marketing claims it to be effective over Interruption Marketing, there is a paradox; Permission marketing is inevitably initiated with Interruption Marketing. To develop a permission-based relationship with a prospect, the very first step is always in the form of traditional marketing, where the marketer has to win the prospects attention.[14]

References[edit]

  1. ^ Sethgodin.com, (2014). Seth Godin. [online] Available at: http://www.sethgodin.com/sg/bio.asp [Accessed 22 Oct. 2014].
  2. ^ Godin, S. (1999). Permission marketing. New York: Simon & Schuster.
  3. ^ Kavassalis, P., Spyropoulou, N., Drossos, D., Mitrokostas, E., Gikas, G. and Hatzistamatiou, A. (2003). Mobile permission marketing: framing the market inquiry. International Journal of Electronic Commerce, 8(1), pp.55--79.
  4. ^ Aweber, (2014). Permission Based Email Marketing - Opt-In Email Marketing from AWeber. [online] Available at: http://www.aweber.com/permission-email-marketing.htm [Accessed 18 Oct. 2014].
  5. ^ Krishnamurthy, S. (2001). A comprehensive analysis of permission marketing. Journal of Computer-Mediated Communication, 6(2), pp.4--6.
  6. ^ Godin, S. (1999). Permission marketing. New York: Simon & Schuster.
  7. ^ Saarbeck, S. (2014). Permission Marketing. Wiesbaden: Imprint: Springer Gabler.
  8. ^ Godin, S. and Cohen, L. (2009). Permission marketing. Paris: Maxima.
  9. ^ TED, (2014). Seth Godin: How to get your ideas to spread. [video] Available at: https://www.youtube.com/watch?v=xBIVlM435Zg [Accessed 27 Oct. 2014].
  10. ^ Yovanno, D. (2011). Why Permission Marketing Is the Future of Online Advertising. [online] Mashable. Available at: http://mashable.com/2011/02/03/permission-marketing-social-data/ [Accessed 18 Oct. 2014].
  11. ^ Yovanno, D. (2011). Why Permission Marketing Is the Future of Online Advertising. [online] Mashable. Available at: http://mashable.com/2011/02/03/permission-marketing-social-data/ [Accessed 18 Oct. 2014].
  12. ^ Forbes, (2014). Seth Godin's 'Permission Marketing' Turns 15. [online] Available at: http://www.forbes.com/sites/onmarketing/2014/04/30/seth-godins-permission-marketing-turns-15/ [Accessed 24 Oct. 2014].
  13. ^ MasterBase, (2014). Permission Marketing. [online] Available at: http://www.en.masterbase.com/solution/permission_based_marketing.asp [Accessed 18 Oct. 2014].
  14. ^ MasterBase, (2014). Permission Marketing. [online] Available at: http://www.en.masterbase.com/solution/permission_based_marketing.asp [Accessed 18 Oct. 2014].