Marketing Channel Deathwatch

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I was speaking with a reporter recently and was asked the obligatory, “Why is email dying?” question. I don’t think he really thought that was the case, but that he just wanted to see how I would respond. I gave him a five-minute rant on why email is alive and well -- and then told him the two marketing channels that are on my deathwatch list:

Smartphones will kill SMS. Driven by the iPhone and Android-powered phones, smartphone adoption is exploding. My family and I just renewed our cellphone contracts over the weekend and I was surprised by the shrinking selection of non-smartphones. The market is clearly speaking.

Smartphones enable several channels that compete with SMS, including email and social media like Facebook and Twitter. While the social channels will compete with SMS for personal communications, email will compete with SMS for commercial communications.

In consumer survey after survey, email is overwhelmingly identified as the preferred channel for commercial communications. Considering all the limitations of SMS in terms of cost, regulations and functionality, email is positioned well to inherit most of the commercial SMS alert volume once smartphone adoption reaches the tipping point, which may only be two or three years away.

The mobile Web will kill mobile apps. Mobile apps exist because the mobile Web stinks. Speeds are slow and browsers have been inconsistent. Mobile apps are the intermediary that makes the mobile Web tolerable compared to what we’re used to on our desktops and laptops.

But it’s stinking less and less every day. 4G service is speeding up the Web, as is new technology such as Amazon’s cloud-accelerated Web browser, Silk, which works with Amazon’s servers to speed up page load times significantly.

There are also financial incentives to make the mobile Web great, thanks to Apple’s stranglehold on the market. Seeking to avoid the 30% cut that Apple takes from content sold through iTunes and the App Store, several brands are circumventing that marketplace by using the Web. For instance, the Financial Times created an HTML5-based mobile application that can be used by any browser, Wal-Mart’s Vudu service can stream video using the iPad’s web browser, and Amazon announced the Kindle Cloud Reader, which lets users read e-books via a Web browser. Other brands are sure to follow these leaders and explore Web-based options as well.

With network speeds increasing and mobile Web browsers improving, it’s only a matter of time before the mobile Web is simply the Web that we already know and love -- just as mobile email is well on its way to working just like the email we enjoy on our laptops.

Together these two changes will mean big things for the email channel. Poor mobile landing page experiences and subpar ecommerce functionality has hurt mobile email as a path to online sales. But the next few years will see those impediments fall away, leaving only the positives that the mobile channel brings to email, including quicker response times and greater in-store opportunities.

Mobile is a huge disruptive force, but ultimately the changes will be very much in email’s favor.

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0 comments on "Marketing Channel Deathwatch".

1. Rita Allenrallen@freshaddress.com from FreshAddress, Inc.
   

   commented on: November 8, 2011 at 11:28 a.m.
   Thanks for reiterating reality, Chad. "In consumer survey after survey, email is overwhelmingly identified as the preferred channel for commercial communications."
2. Lee Horigan from Thomson Reuters
   

   commented on: November 8, 2011 at 11:37 a.m.
   Pleasantly provocative and bang on. The one quibble I might suggest though is what I believe we use our smart phones for via Apps or online...namely, to get stuff done rather than to learn or browse. Unless websites are tuned for a mobile experience, Apps will have a long life. Two of my favourites are my online banking App and local movie theatre App - fast in & out ability to view balances, pay bills, find the nearest showtime and buy a ticket - rather than "find out about mortgages", "book a corporate event" and the myriad other content often found on websites.
3. Harold Cabezas from Cabezas Communications
   

   commented on: November 8, 2011 at 11:38 a.m.
   Well-written, Chad! Salient points-especially about the mobile web. I have always thought apps were just a momentary thing, it's too much of a cut-off from all the web has to offer. I showed the love by tweeting it. Have a great day!
4. Charles Balazs from Washington Post Digital
   

   commented on: November 8, 2011 at 11:48 a.m.
   I'm not so sure about SMS. Some now are saying that new messaging options such as iMessage or GroupMe will take SMS down, but these rely on the limited reach of these apps, whereas SMS is broadly available regardless of your device platform and without an app download. I think this might be the same for e-mail on smartphones. Not every smartphone user is checking e-mail on it, or has even set it up, and the even bigger point is that non-smartphones still outnumber smartphones and will continue to be a big piece of the pie. SMS will continue to have the bigger potential reach than e-mail or these other messaging options.
5. Tim Watson from EMV
   

   commented on: November 8, 2011 at 11:59 a.m.
   Couldn't agree more, I've been saying to people that SMS will die away for the last year. Many have looked at me in a funny way when I've said so, glad someone else agrees now. When talking to groups of Uni students I've done a few adhoc show of hands to see who is increasing and who is decreasing SMS use. For me there are clear signs. Also agree that mobile Apps will in many cases be replaced by mobile websites. But this is going to take longer and there will remain app niches.
6. Jordan Cohen from Pontiflex
   

   commented on: November 8, 2011 at 12:20 p.m.
   Provocative and audacious post Chad. BUT: 1. SMS and email HAVE NEVER COMPETED with each other. It's a fallacious meme propagated by SMS forerunners 5 - 6 years ago. They serve different purposes - always have, and always will. -->a) A bigger threat to SMS volume is free IM applications... especially relevant to interpersonal short communications. Why pay to SMS someone when you can Gchat on your iPhone for free? -->b) With point A said, as Mr. Balazs points out, the ubiquity of SMS as a platform will maintain its relevancy for years to come. Ie, not every smartphone will have the Gchat app downloaded, but every phone will continue to have SMS built in. -->c) SMS will continue to be effective in the commercial sphere for the rapid delivery of highly relevant 1 time communications -- e.g., text a code to this # and we'll shoot you back an MMS with a coupon with a unique barcode in it. 2. Apps vs Web. An enhanced mobile web experience will be a boon to the mobile web - and marketers should be thinking about optimizing their web sites/pages for mobile viewing -- but the mobile web will be a complement to apps, not a detractor. -->a) to Mr. Horrigan's point, there's a difference b/t the casual desktop web browsing and the on the go mobile "get things done" consumer experiences that has ramifications for how content is consumed on smartphones that favors the apps model. -->b) You can take apps with you anywhere and don't need to rely on having connectivity to use them (for the most part). The web on the other hand doesn't work on your PC without a connection, and won't work on your handheld without one either. Advantage: Apps. I agree that things will evolve over time. But, just because we email folks constantly have to fight off the "email is going to die at another channel's hands" comments -- and respond with "you are insane email is different, it rocks, etc." -- it'd be prudent for us not to fall into the same trap of saying other proven media, channels and platforms will die at email's or any other channel's hands. Respectfully, -Jordan
7. Jim Knapp from Bonneville Media
   

   commented on: November 8, 2011 at 4:58 p.m.
   Shocking that an email provider touts email. SMS dead in year? LOL. Our media company is killing it in SMS for clients. Lets use a Direct Mail Metaphor. Messages in Email and Social are like messages in ValPak. Gotta sort through a lot of crap. Messages in SMS are like solo mail pieces that a consumer specifically asked for. And we are seeing similar superb resonse rates. Having said that, we also use email and bet that, long term, both channels will have their strengths and weaknesses. But one kills off the other? Not gonna happen.
8. Chad White from ExactTarget
   

   commented on: November 8, 2011 at 7:40 p.m.
   Thanks for the comments everyone, especially Jordan. I appreciate the thoughtful counterpoints. Needless to say, I'm being a bit dramatic when I say "kill." I'm not saying that commercial SMS and mobile apps won't be around in a few years, just that they'll be in significant decline. Never a dull moment in digital marketing. I personally can't wait to see how things play out.
9. Brian Rock from Network Ten
   

   commented on: November 8, 2011 at 8:25 p.m.
   There is a substantial difference between "kill" and "in significant decline". While I'm sure new technologies will put pressure on SMS, I suspect it will last a bit longer than Chad does. Smartphone penetration is similar to US levels, around 40%, but it's made no impact on SMS usage to date. Compared to four years ago the number of people using SMS each week is up 5% from 83% to 87%). Heavy usage (21+ SMS/week) is up 29%, from 17% to 22% (source: Nielsen CMV, Jun-Aug '07 v Jun-Aug '11). What does support Chad's argument is declining usage with teens 14-17 and to a less extent young adults 18-24. But the cohort/early innovator effects of this are going to take time to filter through the rest of the (older) population. My WAG is that it will be a few years before we start seeing notable declines in SMS usage, and that the drop will be relatively gradual until the end of the decade. At which point I wouldn't be surprised to see it go into freefall.
10. Chad White from ExactTarget
    

    commented on: November 9, 2011 at 10:52 a.m.
    Brian, thanks for the additional perspective. Sounds like we're in total agreement that within a few years commercial SMS will start to decline. The turning point is definitely what's important here, not the last gasp. After all, Myspace is still around, but who cares. Being able to see the peak of that channel is what would have helped brands shift their resources and minimize wasted effort.

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