Monday, October 19, 2009

What's our "Get your free Email at Hotmail" line?


Mike and I were reading this great story over on TechCrunch about how it was that little message on the bottom of Hotmail emails, "Get your free Email at Hotmail", that helped kick off the massive spread of Hotmail back in 1996. The key reasons that message worked were:

1. Simply by using the product everyone became a salesperson.

2. The implied endorsement that came with the message made it very powerful. The receiver of the email could see that a) their friend is a user, b) the product works, c) it's free.

After adding that message Hotmail grew exponentially. From the blog post: "We would notice the first user from a university town or from India, and then the number of subscribers from that region would rapidly proliferate."

I'm not a huge fan of that message because adding it without the ability for users to remove it is spammy so I'd like to do it a little differently. The spammy feel to the message is what the Hotmail founders were worried about too, but it was very effective.

Reading this got Mike and I thinking, what's our "Get your free Email at Hotmail line"?

The email that we sent out to our friends and Shoes of Prey email newsletter subscribers last week worked extremely well. Offering a $50 credit to anyone who had the email forwarded to them saw Shoes of Prey receive over 10,000 visits from an email that we only sent to a couple of hundred people. And sales were great in our first week as a result. We saw emails that had been forwarded on 4 or 5 times. (Thanks to Dom for the awesome suggestion to do this!). However now that the credit offer has expired the email isn't being forwarded on anymore.

How else can we achieve a "Get your free Email at Hotmail" message? We'd love your thoughts!

7 comments:

  1. I think there is a 3rd reason that the Hotmail msg worked...e-mail and free e-mail were new, and it was actually quite trendy to have a hotmail address (oh how life has changed!).

    What you need in your message is to connect the aspirations of your actual market (people who have currently purchased) and your potential market. In this example, the potential know the actual, so you get the growth through electronic word of mouth and recommendations.

    There is an obvious option of some form of pyramid function, whereby people recommend others to buy for a personal incentive, but ideally you want your loyalty to be non-financial, otherwise you'll discount the brand.

    Foxtel have run a quite successful "recommend a friend and get $50 each" offer recently, but that is hardly rocket science.

    What about the old skool cross between the Avon Lady and Ann Summers? There must be a win-win model whereby you provide a stack of champagne and some example shoes to a lady who has a party and all her mates end up buying shoes?

    Whatever it is, I think the secret is in the women who buy these shoes and working out what would motivate them to get others involved, or do they want to keep their secret to themselves?

    PS: Thanx for the mention!

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  2. Mate this is an issue that (believe it or not) I have thought extensively about as I have recently started a removalist business with a friend of mine. I hope you don't mind if I download some unsolicited opinions here but I am very passionate about this topic so I will avoid studying for a moment and will "have a go". Also, before you read on - there is no miracle solution provided here so I do apologise.

    INTRODUCTION

    The crux of my view is that as a business trying to generate referral business - "you get what you pay for". In essence, unless you transfer significant value to to both the referring party and the recipient of the referral it will be very difficult to generate referral business from the general populace (obviously excluding encouraging friends)/outside of your first couple of weeks after launch when your service is new and shiny.

    ANALYSIS

    In the case of Hotmail, the issue of where the value was to the referrer is irrelevant because they did not consent.

    The value for the recipient of the referral is as outlined by you above. The key, in my mind, however, was that there was very little risk/opportunity cost involved in trying hotmail. I could list the reasons why but I think it is obvious.

    My view is that a potential customer has a greater hurdle to jump when trying shoes of prey for the first time. Again, the reasons are obvious. Therefore, I believe sufficient value needs to be transferred to allow for the hurdle to be jumped. In particular, there are three issues:

    1. Providing the customer with an incentive to try shoes of prey the first time

    Ideas:
    a.I would argue that if sustainable from a pricing point of view, the first pair of shoes should always carry a $50 discount.

    2. Providing the customer with an incentive to refer their friends

    My view is that whatever strategy you adopt, you should only reward the customer if the referral results in purchase.

    This is important in order to reduce risk.

    Maybe $5 off for each customer that they refer that purchases a pair of shoes??


    3. Providing the customer with an incentive to come back and use shoes of prey again

    I think a retention strategy is key and may involve an idea of a "discount bank" whereby you receive $10 in your discount bank every time you purchase a pair of shoes. This is then cashed in at a pre-determined point or whenever the customer sees fit.

    COSTING

    I concede that the above involves giving away a fair bit of cash but my view is that if:

    a) it is structured correctly (limits imposed, paid only upon receipt of business by Shoes of Prey so risk is reduced)
    b) there is enough of a margin to play with
    c) the system is simple enough to follow and explain
    d) the financial amount of each reward is sufficient to bring about the intended act and overcome consumer apathy

    it should be controllable and effective.

    Also, I believe, (somewhat without real evidence I can point to), you need to provide REAL value to survive in the marketplace. This comes back to my "you get what you pay for" argument.

    MARKETING

    I would argue that communicating in dollars and words that Shoes of Prey truly respects and is thankful for referral business is a solid marketing idea. I think it shows a long term commitment to your customers and provides a philosophical market difference in a retailing industry focussed upon "sales" and 25% off signs.

    I concede that you don't want to give the impression of being a discount online retailer but I think that if you craft the message properly you can be both "high end fashion fix", "bespoke service/product" and "value proposition" all at the same time.

    We hear of loyal customers all the time but what about loyal businesses?

    CONCLUSION

    In closing, women love shoes so why shouldn't their unfailing love be rewarded by a shoe partner that will encourage and foster an ongoing relationship?

    Good Luck and I apologise if the above is bullsh*t/pulled apart by someone who sees a big hole in the idea!!!!

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  3. How about adding a 'send to a friend' option on the website when people are designing shoes on the site. Then you could run a design a shoe for a friend promo, and give out prizes for the best (and maybe the worst) design.

    You could even take this a step further and let people run their own 'design me a shoe' competitions on your site, e.g. I go to your site and enter the email addresses of my friends who then get an email sent to them challenging them to design a shoe for me. People could then vote and comment on the entries. Would definitely require a fair bit of programming, but i'm sure Mike would be up to the challenge. I'm sure that type of functionality could get you some air time on a few day time TV shows too and really create some buzz ;)

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  4. Have you looked at building in your own adwords experience into your facebook application? Shoes of Prey tokens for multiple clicks or orders and having an addthis/share button so that they can post to their profiles or blogs etc beyond facebook? Might encourage people to post designs and design and buy often (but could end up costly to you too I guess).

    The other thing that strawberrynet did well was the 5% for three products or more (which you could match with referal orders) and then discounts for 5th order, 10th order, 15th and 20th etc...but while it rewards loyalty (and the psychology of women who know that the more the buy the more they are saving :), it's discounting - albeit with a ceiling I guess.

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  5. Hi guys,

    Thanks for your excellent thoughts!

    Safraz, you're right in saying the crux of the issue is that 'unless you transfer significant value to to both the referring party and the recipient of the referral it will be very difficult to generate referral business from the general populace'.

    Yours, Dom's and Anonymouses thoughts on ways to reward people for referrals are very good too. I'm wondering though if there's a way we can incentivise referrals through non-monetary means? I read a management article recently that discussed research showing monetary rewards actually rank relatively low on the scale of motivators for employees. Things like a strong company culture with a good vision and mission, and a great boss ranked much higher, and in some instances, introducing monetary incentives can work against these other factors. I'm wondering if something similar might apply in this instance? For example, outstanding customer service and a quirky business culture have lead to an amazing number of referrals for Zappos. I'm a huge fan and very passionate about great customer service, and given the bespoke nature of our business, excellent, personalised customer service ties in well. We also plan to align our packaging to include a handwritten note about your shoes and a photo of your shoes that you can pin to your shoebox so when it's stacked in your wardrobe you can easily see which shoes are inside. Ideally, if we provide a very bespoke experience together with your bespoke shoes, people will love the total product and want to tell their friends. Whether that works remains to be seen... do you think we can do more in this area?

    Dom, Sean and Anonymous, your thoughts tie in very well here too - once people have had the Shoes of Prey experience, and hopefully had a very good one, the next step is to make it easy for them to share this experience with their friends. The 'send to a friend' feature is a good one and once a person has had a pair of shoes made, we want to provide a page along these lines http://www.shoesofprey.com/shoe/6LL which they can easily share with the friends. We'll add 'post to Facebook and Twitter' buttons on this page to help them share it.

    I also like the ideas around shoe designing competitions, having friends designs shoes for you and even shoe parties amongst friends.

    Thanks guys, some excellent thoughts here. :)

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  6. G'day Michael,

    Sorry for the late reply.

    I do agree with the relevance of the management article in the sense that it begs the question, do you really need to pay for referral business if you can make your product/service good enough that people will be willing to refer it anyway?... Read more

    In keeping with that thinking, the only other idea I have is that you keep a log of your customers and perhaps you invoke the same strategy that some of the better car companies use which is a call 2 weeks after you purchase a car, a call 6 months after you purchase a car and then maybe another call at 1 year. This would obviously have to be adjusted to suit shoes but you get my (not very original) drift.

    Best of luck and keep the business updates coming! :)

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  7. Safraz - That's great thinking with the follow up calls, I like that. Would it be annoying to get a call from a website you bought shoes from or would an email be better? I guess we could try out both and see what people think. It's a great way to get customer feedback as well as engage people with the brand. Thanks!

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