Permission Marketing

What's an example?

H&R Block wanted to introduce a new service aimed at upper-income customers. It's called Premium Tax. None of those customers knew what this was before we started. First we had to get people's attention - and we had to get the right people's attention. So we used banners on various Web sites that said, "H&R Block: We'll pay your taxes sweepstakes." The only people who clicked on those banners were people who paid taxes and knew what H&R Block was. More than 50,000 people responded. In effect, they said, "Here's my email address - tell me more about this promotion."

Then these people became players in a contest. In return for the chance to have their taxes paid by H&R Block, they gave the company permission to teach them about its new service. Every week, they had to answer trivia questions about taxes, H&R Block, and other relevant stuff. They got three emails per week for 10 weeks. We gave them fun facts about the history of taxes or sent them to H&R Block's Web site to find answers to questions. Each email also included a promotional message about Premium Tax. The average response rate per message was 40% - meaning that, on average, every time 100 people got a specific email, 40 wrote back or took action. Over the life of the promotion, 97% of the people who entered the game stayed in it.

We did a survey at the end of the 10 weeks. We divided people into three groups: those who didn't participate in the game, those who participated but not actively, and those who participated actively. Within the first group, learning about Premium Tax was essentially zero - no surprise there. Among people who participated but not actively, 34% understood Premium Tax. For active participants, the figure was 54%. I think that's pretty cool.

We did something similar for Carter-Wallace, the consumer-products company. We created an online game around its Arrid XX "Get a Little Closer" campaign. We offered players a chance to win an all-expense-paid trip to the Caribbean. People found out about it through traditional print ads as well as through Web banners. We got more than 30,000 players. The average player received 24 emails over the course of the game. People had to read these messages to stay in the game. At the end of the game - 700,000 emails later - we did some research. The likelihood of purchase had doubled, from 24% to 49%. An astonishing 25% of players had already gone out and purchased Arrid XX during the game.

Those are two small examples. One of our first sweepstakes, the Million Dollar WebCrawl, was designed to persuade people to use AOL's search engine. We offered a prize of $1 million. Players had to visit specific Web sites and to register their email addresses at each one. This one sweepstakes attracted more than 350,000 players, and they made 2.7 million unique Web visits. Overall, we've created more than 100 online promotions - and the number of participants just keeps getting bigger.

Why contests and sweepstakes?

You can use lots of techniques to make it worthwhile for people to give you permission to talk to them. We use games because they work. Sweepstakes have been around for 700 years. Game shows were among the first programs on radio and television. Back in 1990, Prodigy asked us to create a game for it. The game's first run ended late last year, and we've started it up again. It's called Guts. Players get seven trivia questions a week. Each question is worth more points than the one before, and each is harder than the one before. You can stop at any time and keep your current score, and then come back the next week for another round. But if you miss one question, you not only lose the points from that week - you lose all your points for the whole game. So it takes guts to stay in. So far, more than 3 million people have played Guts. It's the most popular online game in history.

People love games. They're fun, exciting, engaging. We not only entertain people but also educate them - and we get paid for it! We create promotions in which the game itself involves information about products. People search for ads and read them because they have to find missing pieces of information to get the prizes they want. When's the last time you searched for a TV commercial?

How well is the concept of permission marketing catching on?

Just look at Yoyodyne's growth curve. Over the last seven years, we have sent out more than 100 million email messages - all to consumers who have given us permission to send them. Our "Get Rich Click" database, which is our core inventory of players, has 1 million active email addresses - of people who have given us overt permission to send them information we think they might want to know. Recently, during one five-day period, we processed 2.3 million email messages. In fact, we now receive more email than any other company in the world. So the idea is catching on.