Permission Marketing

Seth Godin's company, Yoyodyne Entertainment, is all about fun and games. But its mission is serious business. Godin and his colleagues are working to persuade some of the most powerful companies in the world to reinvent how they relate to their customers. His argument is as stark as it is radical: Advertising just doesn't work as well as it used to - in part because there's so much of it, in part because people have learned to ignore it, in part because the rise of the Net means that companies can go beyond it. "We are entering an era," Godin declares, "that's going to change the way almost everything is marketed to almost everybody."

The biggest problem with mass-market advertising, Godin says, is that it fights for people's attention by interrupting them. A 30-second spot interrupts a "Seinfeld" episode. A telemarketing call interrupts a family dinner. A print ad interrupts this article. "The interruption model is extremely effective when there's not an overflow of interruptions," Godin says. "But there's too much going on in our lives for us to enjoy being interrupted anymore."

The new model, he argues, is built around permission. The challenge for marketers is to persuade consumers to volunteer attention - to "raise their hands" (one of Godin's favorite phrases) - to agree to learn more about a company and its products. "Permission marketing turns strangers into friends and friends into loyal customers," he says. "It's not just about entertainment - it's about education."

Yoyodyne, headquartered outside New York City, works with clients - which include AT&T, H&R Block, MCI, and Volvo - to create these new relationships. All of its campaigns use the Web, email, and other online media. All of them are built around game shows, contests, or sweepstakes. What do game shows have to do with permission marketing? Consumers give a company permission to send them messages in return for the chance to win prizes they care about. "The first rule of permission marketing is that it's based on selfishness," Godin says. "Consumers will grant a company permission to communicate only if they know what's in it for them."

Yoyodyne's techniques are catching on. The company has about 1 million active participants in its games database. It has sent more than 110 million email messages to influence consumer behavior. And it receives more email than any other company in the world. (Online services such as AOL handle more traffic, but those messages are destined for subscribers, not for the company itself.) More important, Yoyodyne's ideas are catching on. In an interview with Fast Company, Seth Godin described the future of marketing - and how your company can get there.

You've got a radical critique of conventional marketing. Why should companies listen?

We are entering an era that's going to change the way almost everything is marketed to almost everybody. Don't get me wrong. Advertising will remain a competitive weapon. Companies that advertise better will do better than companies that advertise worse. But advertising simply doesn't work as well as it used to. Do me a favor and finish this sentence: "Winston tastes good . . ."

". . . like a cigarette should."

Do you realize that the last time that commercial aired was almost 30 years ago? If you want to build a slogan like that today, if you want to burn a message into people's brains, it costs huge amounts of money. Companies spent $175 billion on "advertising" in 1996. But 42% of that money went into things like direct mail, not into what we traditionally mean by advertising. That's because marketers are desperate for better results in a world where the old tools are becoming more expensive and less effective.

What's different today from 30 years ago?

Marketing is a contest for people's attention. Thirty years ago, people gave you their attention if you simply asked for it. You'd interrupt their TV program, and they'd listen to what you had to say. You'd put a billboard on the highway, and they'd look at it. That's not true anymore. This year, the average consumer will see or hear 1 million marketing messages - that's almost 3,000 per day. No human being can pay attention to 3,000 messages every day.

The interruption model is extremely effective when there's not an overflow of interruptions. If you tap someone on the shoulder at church, you're going to get that person's attention. But there's too much going on in our lives for us to enjoy being interrupted anymore. So our natural response is to ignore the interruptions.

Television is unbelievably cluttered. Can you recall one TV commercial you saw last night? The Web is even worse! There are more than 250 million people in the United States, and almost all of them watch TV. And maybe 10 channels really matter. That's 25 million people per channel. There are 45 million people with Web access and 1.5 million commercial sites that are vying for their attention. That's only 30 people per site. The economics just don't work.