On the virtue of simple fulfillment systems

Recently a colleague on the SIPA listserv asked about some of the simple subscription management plugins that work with WordPress. The question took me back to the days when I was first learning how incredibly complicated circulation systems can get, which also reminded me of the early days of iPad.

When Apple first got into the subscription business, I was rather shocked at how badly they misunderstood the publishing industry. Their system for managing subscriptions was very primitive and couldn’t accommodate anything like the complexity that a modern subscription management system should.

The way they structured the business seemed an obvious ploy to replace existing publishers by taking away all their customers. I thought the publishing industry would see through it. Of course they didn’t.

At first I thought all the kids at Apple were being dazzlingly arrogant. Did they, for instance, even know what a snow bird is? I got the distinct impression they thought they didn’t need to learn from all those old dinosaurs, stuck in the habits they inherited from the 1950s. Everything’s different now, they thought, and selling a subscription isn’t any more complicated than selling a toaster. And if it is different, it shouldn’t be.

Ha ha. How I laughed at the cool kids. Now I think they were on to something. Although I think it was luck and not genius.

Modern fulfillment systems have been written to accommodate the quirks and foibles of decades of marketing / circulation professionals, who have been trying different versions of offers and payment plans, tinkering with (“optimizing”) everything they can get their hands on. By now these systems have accumulated so many possible options and policies and different ways to do things … it’s more than a little crazy.

Take a simple example. When a gift subscription is up for renewal, we want to be able to renew the donor with one offer, and if he doesn’t renew we might want to renew the recipient with a different offer, and we want to display different things for both of them on the customer service page. If the donor is a subscribing donor, we might want to attach that renewal to his issue. Sometimes we want to send the renewal premium to the donor, and sometimes we want to send it to the recipient. And if the donor and the recipient both pay ….

All these things require options and switches and policies and rules, and if you get one of them wrong, very weird things can happen. And that’s barely scratching the surface on how complicated it can get.

This all raises an important question. What’s the ROI of complexity?

Imagine two systems.

The first allows you to tweak to your heart’s content. You can do installment billing in Bitcoin if you want to, and there’s infinite flexibility in how and when you send your renewal messages, and what they say. Through careful testing you discover that offering two renewal premiums on effort #4 gives you a 5 percent lift. Hoorah!

The second system has one basic template for bills and renewals, let’s you choose between an annual or a monthly subscription, and … that’s about it. It doesn’t do bi-weeklies (except for the skip week at Christmas), and it doesn’t let you have 14 different prices for the same publication.

With that second system you’re not going to be able to do all the testing and tweaking and “optimizing” you’ve been hearing about at the marketing conferences. On the other hand, you don’t need five people monkeying with the system all the time, and you don’t have embarrassing calamities when one of the 7000 switches is set incorrectly.

Now then. Which system is smarter?

Eat your own, before somebody else does

Let’s say I have a service on the Fair Labor Standards Act. It covers the whole Act, but the subscribers are always calling and asking the editors questions about chapter 4, which covers whether an employee is exempt or non-exempt.

The service sells for $400. Subscribers and potential subscribers are always telling the editors it’s not worth $400, since they only want chapter 4. They resent having to buy all that other stuff they don’t want.

The editor proposes a new service, which is essentially chapter 4, with a couple enhancements. He proposes a cost of $100.

If you’ve been around publishing for a while, you already know what management is going to say.

“But that would cannibalize the FLSA service. Instead of getting $400, we’d only be getting $100.”

I think that response is wrong-headed. If people only want chapter 4, then sell them chapter 4.

This isn’t the Soviet Union. People have choices, and they want to buy what they want to buy. If you’re not going to provide it for them, somebody else will. Your competition isn’t constrained by wrong-headed concerns about “cannibalization.”

If you take the editor’s suggestion, you may sell so many more copies of the $100 service on chapter 4 that you’ll make more money. Or … it may be that you’ll simply exchange your $400 customers for $100 customers, and it will be a huge loss.

Here’s the ugly truth. It’s going to happen anyway. Your $400 customers won’t renew, and they’ll find somebody who’ll sell them what they want at a lower price.

Let people buy what they want, at a fair price, and don’t try to force them into bundles. That’s what cable companies do, and the only reason they’ve been able to get away with it is they have people trapped. As other options become available, people drop that bundled mess and buy what they want.

We live in a time of consumer choice. You can’t force people to buy your bundle if they don’t want it. Go ahead and cannibalize. Break up those bundles, if that’s what people want, because they’ll get it one way or another, and if you’re not offering it, you’ll be left behind.

Having said all that, it’s worth mentioning that subscriber calls to editors are not the only or even the best way to get feedback from the market on a new product. What matters is what people think when they get out their wallets, not what they say on the phone (when it doesn’t cost them anything). So be sure to test your ideas in the real world — the one with credit cards and checks and that sort of thing.

The end of publishing

Sorry publishers. Nothing you do will matter when the hegemons disintermediate us.

Sorry for the $5 word, but it works in this situation. Thomas Chaffee, Chief Executive Officer at ePublishing, used it in his presentation at BIMS last week, and it's exactly the right word.

Chaffee reviewed a lot of the ways our data gets moved around and shared. By "our" data, I mean our own personal information, but I also mean company assets — our subscriber data.

If you have ads on your site, or if you allow social shares or logins, or any number of other things, then you're letting the hegemons know exactly who your customers are. (Sometimes you might be sharing your data without even knowing it. There are some WordPress plugins that send data back to the mother ship.)

"So what?" you ask. "They already know who everybody is."

True, but here's why it matters.

You make money by monetizing an audience. What's going to happen if the hegemons do it better and cut you out? (If they "disintermediate" you.)

They've already indexed all your intellectual property. They already know your audience. In fact, they know your audience better than you do.

What stops them from running all your articles through an artificial intelligence routine that can write the article better — e.g., more finely focused to specific people and interests — than you could ever do?

Computers are already writing news stories. It won't be long before they can write whatever you produce. And they'll be able to make thousands of different versions of each story for every preference, bias and special need. They can tailor the story to your audience in a way you could never hope to. 

You already know that search results vary by person. My results are customized to me, and your search results are customized to you. Once the hegemon has its own version of your intellectual property, customized specifically to a particular audience, they can steer your audience to their version of the story through search results, news feeds, and so on.

In that environment, what happens to publishers? 

Yes, it sounds dreadful and very discouraging from the publisher's point of view. But there may yet be two rays of sunshine in this growing gloom.

First, the computers might take a while before they're able to do this. I might even be able to retire.

Second, personality can be a benefit, so focusing on the relationship between the author and the reader might delay the AIpocalypse. That is, until AI can have a better personality than we can. 

Stop calling your expensive, professional material “content”

Good publishers spend a lot of time and money to hire intelligent, professional editors, writers, proof readers, fact checkers, graphic designers, user interface experts, etc. etc., and we strive to make a fantastic product that’s clearly a sharp step above the nonsense people blurp out on blogs and tweets and Facebook posts.

Then we call this fantastic stuff “content.”

“Content” is a lame word. In my mind it conjures up the polyester stuffing in a cheap pillow. That’s the “contents” of the pillow.

You might ask, “What’s the content of that box?”

A: “Oh, just some junk from the garage.”

“Content,” in short, is not an inspiring word. It brings to mind the uninteresting stuff that fills something else.

A lot of stuff out there is “content.” It’s the blather of the masses. It’s the dreck from which, occasionally, something surfaces to get 15 minutes of fame on Twitter.

That’s not your business. You’re not in a contest against images of somebody’s rear end. You’re doing more compelling, interesting things.

So here’s a challenge. For the next week, every time you’re tempted to say or write “content” as a description of the professional, excellent material you produce, say “intellectual property” instead.

There are two very cool things about intellectual property. First, it’s intellectual. Second, it’s property.

It’s not stuffing. It’s not the junk in a box. It’s intelligent and meaningful and worth your time.

It’s also valuable. It’s somebody’s property (yours), which means other people don’t have a right to it without compensation.

Publishers need to believe in their product if they expect other people to, and steering away from the bland and boring “content” might be a good start.

What do you call an anti-Luddite?

I used to correspond with a man who was a self-professed Luddite. He's a great fellow, but he was born in the wrong century and hates computers, email and the internet.

Then one day, out of the blue, I got an email from him. I asked what was up, and he said he couldn't find ribbons for his typewriter any more.

The funny thing is that he probably could have purchased them online.

We all love to tease the technologically impaired, but there's another group we need to watch out for — i.e., the people who insist on using a computer to "solve" something that doesn't need solving. What do we call these people?

A Jetson?

Computers have and will continue to change things, and everybody knows they've changed publishing rather substantially. But a level-headed approach to "digital transformation" can't, on the one hand, deny the transformation that's going on, or, on the other, exaggerate or misrepresent it. E.g., "print is dead."

Great intellectual property continues to sell — yes, even in print. See Chip and Joanna Gaines’ magazine increases circulation.

Often I fear that publishers are blaming "digital transformation" when the truth is that they're selling junk nobody wants. "The computer ate my business." Well, maybe it did, or maybe you've just forgotten some fundamentals.

Print is in decline, for lots of reasons. But print is still a huge part of the publishing business. Publishers need to optimize for digital, but they also need to optimize print.

A Trekkie?

There are some things print still does better. E.g., it's a lot easier to loan somebody a print copy of a magazine, or give it to them when you're done with it. And despite all the talk about "digital natives" doing everything on computers, students continue to prefer printed textbooks.

Next time you go to the newsstand, pick up the most tech-centric magazine you can find. I'll bet you a sandwich and a cup of coffee there will be blow-in cards in that magazine.

Yep. Dumb old printed cards. In 2017. Can you believe it?

You know why they're in there? Because they work.

A creative colleague of mine came up with a good name for the anti-Luddite.

Technophant.

Think sycophant, not elephant. As if they're always kissing up to technology.

I'm very far from being a Luddite. I love Star Trek and science fiction and technology and all that wacky stuff, and my kids will tell you I'm always saying things like "in the future we won't ____." The first thing I touch in the morning after turning off the alarm is my iPad.

But I also like to be practical. Most people read magazines in the dead tree version. Rather than bemoan that, and cry about it, and wish things were different, why not optimize it. Take advantage of the strengths of the medium and make print the best it can be. Use it in new and creative ways. Or swallow your pride and use it in some old-fashioned way that still works. Don't be so sold on "new" that you do the new thing that sucks.

For example, let's say you want your older audience to share an article with their kids. Why not perf the page and make it easy for them to rip it out?

Sure, it sounds old-fashioned, and some people will roll their eyes. "What? In 2017?"

But I'd bet you two sandwiches and five cups of coffee that perfed page will be a hundred times more effective in getting that article shared than giving them a URL or a QR code or any other tech solution.

Is Facebook a “media company,” and why does it matter?

In March of this year, Wired said

“Facebook steadfastly resists categorization as a traditional media company. Instead, CEO Mark Zuckerberg insists on calling the social network a technology platform—even though nearly half of all American adults get their news on Facebook. ”

Facebook has — at least at times — wanted to be seen as a “dumb pipe” for other people’s content, and thereby avoid any responsibility for what appears on the platform. Which is probably a good idea, because when it comes to promoting accurate news, they don’t seem to be very good at it.

Facebook has two contradictory social goals. On the one hand, it wants to let people share their own feelings and be “connected” and teach the world to sing and all that, but OTOH it wants to be a “safe place,” free of harassment, hate and discrimination.

You can’t have that both ways, even if you are a tech genius billionaire.

Facebook is intimately involved in what people see and how they perceive the world. Its algorithms decide what appears in a user’s news feed. It intervenes to squelch undesirable speech. It seems to have been a useful conduit for “fake news,” and it’s possible the Russians used it to sew discord and exacerbate social tensions in the US. On top of all that, Facebook is trying to dominate video, which is where a lot of the growth is occurring in online content.

With all this going on, it seems increasingly absurd that Facebook is anything but a media company – and, as noted above, a particularly bad one. (Yes, I linked that story twice just to rub their noses in it.)

Why does it matter? Why is Facebook so intent to deny the obvious truth?
Scott Galloway suggests it has to do with their stock valuation. Tech platforms get a better valuation than media companies.

That seems reasonable.

The “responsibility” angle seems pretty likely as well. Along those lines, I found this article helpful.

The reason this distinction matters is that pure technology platforms receive greater immunity regarding the content they serve, both legally and in the public eye. This stems from the 1996 Communications Decency Act’s Section 230(c), or the Good Samaritan act, that states “No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” Media companies are considered more directly responsible for their content.

The other thing to consider is advertising.

When you’re trying to create a corporate culture with idealistic young tech geeks, the notion that you are empowering people to share and connect make the world more open sounds nice. (“Can I have some baby kale with that, please?”)

When you have to admit that you’re chasing advertising dollars, it’s not so hip any more. Working for a “media company” that’s trying to make a buck like everybody else doesn’t put you on the road to Shambala. (Yes, that’s an old song, but you get the point.)

Anything that’s (1) old, (2) an important part of the culture, (3) a big source of money and power, and (4) sometimes regulated is going to have some weird stuff going on, and that’s certainly the case with media. We have a strange mix of rules for “media companies.”

Broadcast companies have to get licenses and show that they’re acting in the public interest – because they’re using the airwaves, which are a public resource. In the past, we had this weird thing called the Fairness Doctrine, which “required the holders of broadcast licenses both to present controversial issues of public importance and to do so in a manner that was … honest, equitable, and balanced.”

As a silly side note, The Fairness Doctrine was assumed cultural background when All in the Family’s Archie Bunker demanded equal time after hearing a gun control story he didn’t like. I don’t think a modern-day Archie would get far if he called Zuckerberg and demanded that he “fix” Meat Head’s deceptive timeline.

The Fairness Doctrine is no more, and cable TV never had the same restrictions because it didn’t use a public resource. And — as we all know — the internet is the Wild West compared to cable TV. You can post anything you like.

Still, there’s a perception that media has an obligation to be fair.

Tying it all together, why does it matter if Facebook is a “media company”? I see three reasons.

  • Valuation
  • The sense of responsibility that comes with being a “media company”
  • Feeding the idealism of the Facebook workforce

But that’s just my opinion. Chime in with your own if you like.

No, you’re not losing *that* much money in your cart

I’ve been reading a bit recently on how to improve the online shopping experience, and how to solve the dreaded cart abandonment problem.

You’ve probably seen calculations along these lines …

You have 100 transactions a day that are worth $50 each, but 50% of the people who start a transaction in your store don’t complete it. If you could eliminate the problems in your cart, you’d double your revenue. Whoopee!.

No, you won’t.

Those calculations assume that everyone who adds something to a cart intends to buy, and it’s just your lousy cart that stops the sale.

We all know that’s not true. Visitors add things to carts for all sorts of reasons that have nothing to do with an intent to buy. They might only want to see the full cost — e.g., with shipping — to decide if they’re interested. They might want to save the product and go look at some other options. They might want to recommend it to their spouse as a good gift idea, and your site doesn’t have a wish list.

Even the most genius, perfectly designed e-commerce site in the world is going to have some cart abandonment.

That doesn’t mean we should be complacent about it. We should try to reduce cart abandonment even though we can’t eliminate it.

Here are some of the top tips I’ve seen.

Avoid unexpected costs, which is one of the top reasons people abandon their carts. Heavy shipping fees can ruin the sale.

Make the site mobile friendly. That should go without saying, but … it doesn’t. A lot of sites look horrible on mobile, and many people make purchases on their phones.

Use trust badges. Norton is the most trusted name, but a security badge is better than no security badge.

Include as many payment options as you can. This can be a big hassle on the back end, so you’re going to have to make a compromise between “what’s good for my cart” and “what makes accounting want to kill me.”

I have a suspicion that adding Paypal or Amazon checkout helps sales on mobile — since who wants to enter all their data on a silly phone keyboard? — but I haven’t seen any confirmation of that theory.

Allow guest checkout. If you make visitors join your club or create an account, you’re going to lose some people. That might be okay, depending on your business model. Just be aware that the more you ask, the more people you’ll lose.

Use product thumbnails if that’s applicable to your business.

Use proper calls to action. “Checkout” should be bigger and bolder than “update cart” or any other functional badge on your page.

There are other things you can experiment with, but those seem like the big ones to me.

How Alexa and Google Glass will revive print publishing

The main cause of the decline in print magazines is not consumer demand. It’s advertising.

Survey after survey shows that consumers continue to like print. There are some people who read digital editions, and some people who find what they used to find in print magazines on web pages. But the main reason print magazines are suffering is that advertising revenue is drying up.

Advertisers are leaving print because digital ads are easier to target and easier to track. With digital ads, advertisers can get the precise niche they want.

We all know that we leave an incredible trail of bread crumbs on the internet, rich with information on our likes and dislikes, what we buy, when we buy it, what articles we linger on, and so forth. All this information is used by advertisers to target ads to the right people.

It’s very hard to do the same in print. There are no very reliable metrics for which articles people read, how much time they spend on the ads or on the stories. And it’s hard to get people to go from printed media to online.

That’s going to change.

When everyone is wearing Google Glass — or, as I predicted decades ago in my sci-fi book, The Intruder, when everyone has an implant in their eye — reading a printed magazine will be just as trackable as web activity.

Right now it’s hard to get people to transition from the printed page to a website. It was hard with desktops, for obvious reasons, but it’s even hard in an era when people have a mini computer in their pocket.

Some people thought QR codes would solve that, but they haven’t. People seem to be in a different mode when they’re reading print. You can provide a URL, but most people won’t do anything with it.

That will change when people are reading a printed magazine through a smart lens. The transition from print to digital will be easy, and you’ll be doing it all the time, e.g., looking up ingredients for a recipe while you’re in the grocery store, or checking the reviews of a bottle of wine before you buy it.

Alexa is another technology that will revitalize print. (So will Google Home.)

You’ll be sitting in your arm chair with an adult beverage at your elbow, reading the latest issue of Brew Your Own magazine, and you’ll realize you really need that plate wort chiller after all. Conveniently tucked in the corner of the ad will be a special phrase you can speak to order it.

“Hey Alexa, buy the 4710 plate chiller from Maryland Homebrew.”

Both these technologies will make print media far more attractive to advertisers.

***

Somewhat along these lines, see this story: Print Books vs. Ebooks? (We’re Asking the Wrong Questions)

Making the print edition the hub of a physical + digital experience will be easy once we integrate Google Glass, Alexa, Google Home, and similar technologies.

“Don’t let the back end run the front end”

I’ve heard that saying many times over the years, and there’s some wisdom to it. You want to make the best possible offer with the customer in mind, not the offer that makes your systems people happy.

But … the more I get involved in the back end — either from the IT side or the fulfillment side — I realize it’s not so simple, and that ignoring the back end as if that’s going to help you on the front end doesn’t work.

Systems aren’t creative or flexible. They’re designed to do certain things. As a programmer colleague told me, systems (computers) are very good at doing one thing a million times. Marketers often want to do a million things one time.

Another way to look at this is something I call the Frank Rule (although it’s not really a rule): “We’re going to do all this set up and create all these special rules and exceptions and churn and we’re going to get one order.”

When you add exceptions and special rules for weird circumstances, two things are likely to happen: (1) you create lots of manual work to force the system to do your bidding, and/or (2) your system becomes a mind-boggling mess that nobody wants to touch.

For example, let’s take one very narrow slice of the publishing pie. Renewals.

It starts off very simple. For every order on file, we want to send out renewal notices 3 months before expire, then again at 2 months, 1 month, at expire, and 1 month past expire. Easy peasy.

Until marketing says they want to make an early bird offer for the first effort, or they want to attach the renewal notice to the issue, or they want to add a free issue, or ….

There’s no end to the creative sorts of offers that can be made, and that’s just for one product at one company. When you start to mix in different kinds of products with different terms, different prices, different special offers, club discounts, etc., it can get very complex.

The system needs to try to accommodate all these variations, but it also needs to be stable. If the programmers change the system to accommodate Company A’s quirky renewal series, they don’t want to mess up Company B’s series in the process. After a while, the system starts to look like a very complicated house of cards, and everybody’s afraid to do anything with it.

So how do you work in that sort of environment?

Clearly you start with the offer. What do you want to do, irrespective of the system’s constraints? Then you see if the system accommodates that offer. In those cases where it doesn’t, you have a few choices. (Which don’t include pitching a fit and screaming “why can’t you just ___?”)

1. Do a workaround. E.g., the system can’t take an order without a proper postal address, but you want people to be able to sign up with just their name and email address. So you supply a generic postal address with all these orders. (How does that happen?)

Unfortunately, that messes up your reports, which sort based on zip code, so somebody has to manually export the data and redo the reports.

You can do this sort of klugy thing, but you need to stop and ask if you’re going to spend more in manual workarounds than you’re going to make with your genius offer.

2. Use a different system. When system A doesn’t do exactly what you want, it’s tempting to use system B — just for this offer. But this often creates lots of other problems.

Will orders placed through system B go into the same customer service / account management areas on your website? Will customers be able to login with their regular credentials? Will these orders report properly to accounting? Will you have to build a new interface with your email system?

Is it all worth the churn?

3. Change your offer. Or, in other words, let the back end drive the front end.

It’s frustrating. Even maddening. But it’s often the right choice.

There are times when you can do a workaround or use a different system without making of mess of everything, but … not all that often.

Please join my thought experiment on print publishing

Why are advertisers putting so much of their money in digital and generally leaving print?

One big reason is that advertisers can do so much more with digital ads, both in targeting and in tracking.

But why is that limited to online? What if we could change printed magazines to make them more like a page on a website?

Targeting ads on web pages is enabled by all the spooky demographic and psychographic data the ad system has on the visitor. As you know, you’re being tracked all the time, and your online profile says a lot about you — what you buy, what you read, where you spend your time, what you’re interested in, what you’re likely to click on, etc.

All this data is being collected so advertisers can find exactly the right audience for their product or service. If the advertiser wants an audience of 50+ year old men with a net worth over $1 million and an interest in retirement, the ad system can easily accommodate that because it has access to that data on a huge number of prospects. (I’m glossing over the details, but you get the gist.)

This is how Facebook and Google attract all the advertisers. They have tons of data and can create very targeted audiences. Especially Facebook, since you have to login to Facebook. Their spooky analytics know way too much about you.

But what if a publisher had all that spooky demographic info in his print fulfillment system, so he could target print ads just as precisely as a website can target digital ads? To make the concept a little easier to follow, imagine Facebook wanted to do a print magazine. Just as they customize everybody’s feed online, they could customize every issue of the magazine to the individual user.

I’m not sure any printer currently offers that level of print customization, but there’s no reason why it couldn’t be done.

Now, take this little thought experiment to the next step. What if the price of the magazine depended on whether or not the subscriber is a good prospect for advertisers?

Yes, yes, I know we’re all equally valuable in some cosmic sense, but we’re not all equally valuable to advertisers. Advertisers want to get their ads in front of people with specific interests, who are willing and able to take some action. Usually that action involves buying something.

The imaginary Facebook magazine that’s sent to a very valuable prospect — e.g., just to make it crude and obvious, somebody who buys a lot of stuff — will make a whole lot more ad revenue for Facebook than the magazine that’s sent to another person — who doesn’t buy anything.

The business model for this magazine would change for each individual customer. The guy who buys lots of stuff might get the magazine for free, since Facebook would make more than enough from ad revenue to pay for the production, printing and mailing of each issue. But the miser who never spends any money has no value to the advertisers, and therefore none to Facebook, so he’d have to pay for his magazine.

This new business model would be a mix of the controlled circulation model and the regular subscriber model. When a potential customer goes to the magazine subscription page, the spooky analytics in the background would check to see what audience niches he fills. If he’s a very valuable prospect, he might get the magazine at a low price, or even for free. But if he’s not in any of the niches the magazine wants to advertise to, he’d have to pay full freight for the subscription, since the magazine won’t get any ad revenue from him.

I don’t know if anybody can do this in the real world, but it’s an idea to ponder.

Right now we’re in a weird place in this print / digital question. It’s become quite clear that readers like print, but print has a hard time paying for itself, so print is … dwindling. There’s no reason it has to.