It should come as no surprise that the way we get news today is quite different than in the last decade. Daily Newspaper circulation, which stood at 62 million in 1990, fell to 43 million in 2010, a decline of 30% (source: The State of the News Media 2011). There are many reasons behind this decline. One is a drop in advertising revenue, which has resulted in staff reductions, less content and reduced deliveries.
Few would argue the importance of customer satisfaction. Every business owner strives for happy customers. In practice, however, what does it mean to achieve customer satisfaction? What makes a happy customer? Are they more profitable? More loyal?
Fortunately, considerable research has been performed on this subject, which will be quite helpful to address these questions. The first challenge is to understand what is actually going on versus what business owners think is going on. According to Lee Resources, 80% of companies say they deliver “superior” customer service, but only 8% of people think these same companies actually deliver this type of service. That is quite a perception gap. A big part of the reason why such a gap exists is that most unhappy customers don’t tell you – only about 4% – according to “Understanding Customers” by Ruby Newell-Legner.
The band U2 and Apple partnered this month to do a remarkable promotion and awareness activity. Every iTunes user received a copy of U2’s latest album, Songs of Innocence. When I heard about this offer, I couldn’t believe it. I saw a television advertisement showing the band playing a song from the album. Then, at the end of the ad, it was explained that the album would be available for free to iTunes subscribers.
I am a big U2 fan, so was thrilled at this act of generosity. And, as a marketer, I couldn’t help but think about what the terms of the agreement might have been. Clearly, both Apple and U2 stood to gain from this promotion – Apple from getting new subscribers, and U2 from having Apple pay millions to promote their album.
A New Promotional Trend for Music?
Of course, this is not the first time music has been given away for free. Many artists offer promotional songs or live recordings as a way to generate interest and awareness.
But, U2 is hardly in need of any new promotional campaigns. They have sold more than 150 million records worldwide, won 22 Grammy Awards, and have been designated by Rolling Stone magazine as perhaps the “Biggest Band in the World”. No, this is not a band seeking awareness. Something more is going on.
An Act of Generosity
An interesting story has unfolded as part of this giveaway. It turns out Harriet Madeline Jobson issued a complaint to Bono (the lead singer of the band) stating, “Can you please never release an album on iTunes that automatically downloads to people’s playlists ever again? It’s really rude.” The comment came to light in a Facebook Q&A the band released on their fan page.
To Bono’s credit, he apologized, stating: “Oops, I’m sorry about that. I had this beautiful idea and we got carried away with ourselves. Artists are prone to that kind of thing: [a] drop of megalomania, touch of generosity, dash of self-promotion and deep fear that these songs that we poured our life into over the last few years mightn’t be heard. There’s a lot of noise out there. I guess we got a little noisy ourselves to get through it.”
There was no need for an apology. It was a gift. If you don’t like a gift, don’t use it. Contrary to Harriet’s claim, you had to download the songs to make them active on your iTunes library. If she didn’t want the songs, she simply could have chosen to not download or listen. What is remarkable is the level of conversations that are now going online right now.
As you might expect, folks are taking both sides. What is interesting, though, from a marketing and pricing perspective, the adage on pleasing people holds true: “You can’t please all the people, all the time.” Even at a price of free, not everyone is a “taker.” This is an important point to consider when pricing your product. And, to those economists out there, the laws of a downward sloping demand curve can only be projected so far … there comes a point when that curve flattens out. 🙂
A Final Word on Publicity
The famous PR quote is that there is no such thing as “bad” publicity. Here is another example where that saying is still true. The amount of coverage of U2s short Q&A video on their Facebook page is nothing short of phenomenal – it has gone viral. In two days the video was seen by 1.4M fans. Most marketers would be very happy that type of coverage. And, let’s not forget the comments – the 5-minute video has been shared 12k times, a hashtag of #U2NoFilter was created that is now trending, and there are nearly 4k comments on the page already.
Demonstrating his wisdom, Bono responded brilliantly, reinforcing his “cool” status and spokesperson expertise. As marketers, we can all learn how U2 played out this interesting experiment. They were bold and brave enough to try something new, realizing that some would take offense or not understand their actions. Time will tell if other bands will follow … I’ll keep my fingers crossed, as I really like a musical gift!
Here are two other pricing articles you might find interesting: