An Internet Marketing FableThere wasn't any warning. The first drop was sudden, dramatic and not immediately clear. It was the day after Halloween. We were tired and our Christmas plan was set, but there it was. Everything that monitored the world as we knew it was down when it should be up. This mystery had to be solved.
As always I checked ourselves first. The people who came acted normal. Conversion was even up slightly. We ended a themed sale midnight on all hallows' eve. This the first day of November started our pre-holiday sale. There were a series of interlinked campaigns and offers that would move time toward the inevitable Black Friday, Cyber Monday and the biggest day of the year usually around December 20th depending on the calendar.
This year the wind was in our favor. The calendar smiled and was giving us an extra day or two for the last minute crowd, the biggest and most profitable crowd. Everything but the toplines looked good in our world. Our server's hadn't burped and we didn't attempt to shoot off our foot. Something else was happening, something bad.
Moving from our Key Performance Indicators to Google I say the beginning of a nightmare. Organic and paid traffic were inline. This meant Google wasn't the source of current pain. This meant someone was fighting us and winning. For some strange reason I remember West Side Story and an impossibly young Natalie Wood popped into my mind.
I would check the Sharks, our main competitor's page, next. Walking into the dark alley that was our main competitor's site I saw the glint of steel, heard the slide of the gun's rack. There, large and in charge on the top of the page in 36 point helvetica was FREE SHIPPING ALL ORDERS ALL SHIPMENTS.
Stunned I called for a war council. Our version of the Jets was a group of well meaning but over matched direct marketers. Catalogs and print advertising was their trade. Sliding a single sheet of paper across the table I shared my worst fears. Christmas would be down 10%, Valentine might be worse.
There was a long silence as the President and her most trusted adviser looked at the paper, back at me and then each other. "What do you want to do," was their first question. "Match it," came my immediate response. Hands were wrung and all the reasons not to do such a thing came rapid and overwhelmingly fast almost as if those arguments were rehearsed in some macabre way.
Shipping was "real money" and would hurt our "profits". We had played with trigger point Free Shipping of course. Free Shipping was the table stakes to the fight, but we weren't believers. Every number I saw said Free Shipping was the real advertising we needed. Instead we continued to buy expensive, like $500,000 for a single ad, print advertising.
"I will be damn if I will abandon print advertising," the President of the Jets had claimed one day defiant and dead wrong. Here on the day after Halloween we were a tad hung over and about to make the worst decision any Internet marketer can make. We were about to bring a knife to a gun fight because we didn't match, we stayed with our plan. We brought the knife and paid the price. Christmas sales down 12% Valentine's sales, Valentine's Day was bigger than Christmas in the steepness of the sales curve and its immediate drop off, off 18%.
Over the course of the next year we would lose 25% market share to this single competitor. A year later they holstered their gun, its job more than done, on the day after Halloween. I learned a valuable Internet marketing lesson - don't bring a knife to a gun fight.