Selling to the periphery as the golden path to success

Yesterday I posted The rate of engagement among a brand’s Facebook fans is seven in 10,000.

This section was to me the most provocative, but yet also consistent with my own thinking.

First, you will never increase your brand’s market share by targeting existing users — the task that digital media performs so efficiently. The effort and expense marketers put into targeting their own customers with emails and web banners is largely wasted; loyalty programmes, says Sharp, “do practically nothing to drive growth”. What seems like a prudent use of funds — focusing on people who have already proved they like the brand — is actually just spinning wheels.

Second, and paradoxically, a successful brand needs to find a way of reaching people who are not in its target market, in the sense of people who are predisposed to buy it. The brand’s advertising must somehow gain the attention of people who are not interested in it, have never bought it, or who bought it so long ago they can’t remember — so that when they are ready to buy, it automatically springs to mind. In the wastage is the value.

This is consistent with a lot of findings in network theory and affiliative sociology. It is becoming well established that when job searching or doing sales, your likeliest source of success is not with those with whom you have the deepest relationships, your nearest circle of friends.

The best leads come from the second and third circles out from your core friends. The reason has to do with statistical overlaps. When you think of friend circles as access nodes to information, it becomes a little clearer. Think of the perfect job opportunity.

If you start looking for that perfect job opportunity, how likely is it that your closest friends know about it but you don't? That's the heart of the issue. Your closest friends have a knowledge and experience set that tends to be highly correlated with your own. Yes, they might know something you don't but the odds are significantly lower than someone who is two or more circles out. A friend-of-a-friend likely has a dramatically lower overlap of knowledge than your immediate circle. And an acquaintance of a friend, yet even lower odds of overlap.

The further out on your friend network you go, the more likely it is that they are aware of things you are not. Hence the demonstrable value of networking.

I take all this and look at the book industry. People are always trying to break into the authorship gig but the hurdles are horrendous. Not in terms of being published. Those hurdles are lower than they have ever been and almost non-existent. No, the barriers to entry are not getting published, they are getting noticed. It's all about marketing.

"You will never increase your brand’s market share by targeting existing users" is especially relevant. 50% of the population read no book electively during a year. 10% of the population do 80% of the reading. 40% of the population do 20% of the reading, averaging about a book every two months or 6 books a year.

The 10% who do 80% of the reading are knowledgeable and discerning readers. They usually stick with their reading interests which often flow along genre lines. The reader of westerns is unlikely to take up a romance. A reader of romances unlikely to try out nonfiction science. A reader of mysteries is unlikely to switch to contemporary literary fiction. Etc. People read what they are interested in and have relatively fixed ideas of what that might be.

What Sharp's research suggests s that publishers should be focusing their marketing efforts, not on already enthusiastic readers but on occasional readers and the non-readers.

The most effective ads don’t sell, but they do make people buy. By keeping the brand alive in your mind, Coke ads change the probability of you buying it in the next year by a minuscule proportion, a nudge so small that you almost certainly won’t notice it, which is why people often say that advertising doesn’t affect them. But that tiny effect adds up to millions of cans.

Enthusiastic readers are a small body count in the market (10%) even though they buy most the books. But they are very set in their ways and very canny book buyers. It is the ninety percent of the market where publishers have the best chance of getting occasional readers (40% of the market at 6 books a year) and the intermittent readers (50% of the market and fewer than a book a year). If they change their reading habits by even a small amount, it has a huge impact.

I think this is what the WE NEED DIVERSE BOOKS people miss. It is not a supply side issue. There are near infinite books published each year (from the perspective of a single reader) and there are many, many publishers and there are exceptionally low barriers to entry. Publishers are not the problem.

It is readers who are the problem. They are not reading the books the WE NEED DIVERSE BOOKS people want them to read. So this isn't about publishers or racism. This is about getting readers to want to read the types of books that the WNDB people want them to read.

That's a big ask and involves quite a different set of activities than trying to shame publishers into publishing a few more books that people aren't likely to read. This is, in large part, why I think the WE NEED DIVERSE BOOKS campaign will end up failing. They have misdiagnosed the problem and do not have any solutions for the real issue.