Friday, November 25, 2005

The Bitter Irony of Decision Making

The Pan-American Exposition of 1900 produced two events of lasting significance. First, came the assassination of a president. On September 6, following a speech at the Temple of Music, President William McKinley was shot twice by anarchist Leon Czolgosz. The president was carried to a house across the street. The doctors could not determine the location of bullets lodged in the president’s body, and without that knowledge they refused to operate. The bullets remained, the wounds became septic and McKinley died 10 days later from the infection.

The other event of note occurred right next door, in the Pavilion of Science. It was the demonstration of the first working x-ray machine. In her memoirs, Ida McKinley wrote not of the death of a president, but of the loss of a husband and father. She noted the bitter irony that technology that could have provided the information to save her husband’s life sat 200 feet away, but was never used.

Our use of knowledge to impact decisions is a similar bitter irony. No other industry has spent more to gather customer information. We have built impressive data warehouses. Yet, we still have not mastered using this data to make better management decisions. Marketing is complex with its proliferation of products and channels that change seemingly overnight. When we act without good information, the result is usually wrong.

Is there an x-ray machine sitting nearby as you elevate best practices for leveraging technology?

Getting information systems right is hard work. There are no silver bullets, but there are processes and technologies that are making the task easier.

Thursday, November 24, 2005

A short story on Reality:

Sherlock Holmes and Dr. Watson go on a camping trip, set up their tent, and fall asleep.

Some hours later, Holmes wakes his faithful friend.

"Watson, look up at the sky and tell me what you see."

Watson replies, "I see millions of stars."

"What does that tell you?"

Watson ponders for a minute. "Astronomically speaking, it tells me that there are millions of galaxies and potentially billions of planets. Astrologically, it tells me that Saturn is in Leo. Time-wise, it appears to be approximately a quarter past three. Theologically, it's evident the Lord is all-powerful and we are small and insignificant. Meteorologically, it seems we will have a beautiful day tomorrow. What does it tell you?"

Holmes is silent for a moment, and then speaks. "Watson, you idiot, someone has stolen our tent."

If Reality can fool Watson, it can fool us, too.

As marketers, we must continuously stare into Reality and not let it fool us into bad strategies.

The Power of Listening

As Yogi Berra, one of my favorite philosophers, once said, “You can observe a lot just by watching.”

The same goes for listening.

Years ago, Lexus management gave us a simple component of Lean Marketing. Every executive was required to talk to one customer every day. Surprising, only, is that more companies did not follow Lexus.

If we all did this, we would acquire such an insightful understanding of what our customers want that we would have an unshakable advantage over competitors. If you are a C-level executive, you could put this in place tomorrow morning. At almost no cost!

Niche Marketing Doubles P&G Sales

Advertising Age reports that Procter & Gamble Co.'s brand integration campaign for Tide to Go on "The Apprentice: Martha Stewart" doubled sales of the product, according to the company.

That piece of news is fascinating. The show is a flop. The audience tuned Martha out. But clearly those of us who have stayed with the show were enought to make a dramatic impact on P&G sales.

While not conclusive, it does seem to support our notion that niche audiences can produce a strong sales performance. Mass audiences are not needed if you can get to the right niches.

Wednesday, November 23, 2005

The Shopping Season is Underway -- Online

Hitwise began its holiday shopping analysis early and found that Google and Yahoo! Search sent 25 percent more visits to the 10 leading shopping comparison sites versus last year (for the week ending November 19, 2005 versus the week ending November 20, 2004).

Looks like the Shopping Season is in full swing ... and that online will get a bigger share than it did last year. The key contextual marketing factor in play is that these shoppers are doing comparison shopping. They know what they're looking for and now they just want the best price.

Would You Get in an Airplane with
a 2% Chance of a Safe Landing?

The average response for direct mail campaigns is 2.55% and the rate for eMail campaigns is 1.88%. This is a world where 2% response rates for the past 25 years have been the benchmark of success -- across all forms of measurable marketing media, from direct mail, to in-store coupons, to free-standing inserts, to outbound telemarketing, and broadcast commercials. Factor in the stark reality that the typical sales person closes just one out of eight sales opportunities. We have a long way to go.

Let me lift the issue out of marketing for a moment, and make it really personal.

Would you get on an airplane that had a 98% probability of not arriving safely at its destination? That’s exactly what we are asking our CEOs to do when they support our marketing and sales programs. We give them a two percent chance of survival.

If Ford rolled off its assemblies only two out of 100 cars that started at the beginning of the line, no one would find that acceptable. Fortunately, production systems are much more reliable than are the systems used to sell those cars.

Sakichi Toyoda; his son, Kiichiro Toyoda; and a production engineer by the name of Taiichi Ohno were the innovators of the Toyota Production System that today is the foundation for lean manufacturing. In his system, each process produced only the kinds and quantities of items that the next process in the sequence needed, and only when it needed them.

Production and transport at Toyota took place simultaneously and synchronously throughout the production sequence — inside and between all the processes.

Kiichiro thus laid the groundwork for just-in-time production, and he gets credit for coining the term "just in time."
Manufacturing had found a process to deal with problems inherent in the making of products.

Marketing, however, was still in the swamp with the alligators. Our problems date back at least to the early 1900s.

Marketing is a half-century out of touch with today’s reality

We all know the story of John Wannamaker, the Philadelphia merchant, who at the beginning of the 20th century broke new ground in retailing by advertising fixed prices and money-back guarantees. He became forever famous for his comment, "I know that half of my advertising does not work. I just don't know which half it is." Such ambiguity is the bain of marketing. Even when it does work, we don't know what the successful components were, and when it doesn't work we don't know how to fix them. But mostly, it doesn’t work.

When he addressed the marketers attending the Association of American Advertising Agencies in 2004, Yankelovich President J. Walker Smith identified a number of reasons why marketing productivity is deteriorating, due in large part to consumers drowning in an overabundance of data and information that fails to meet their needs and desires. Marketers can reverse this trend, Smith contends, by doing what consumers prefer. This means moving toward a model in which marketing practice itself is viewed as a source of competitive advantage and away from the current pattern of marketing saturation, clutter and intrusiveness.

Mass marketing is dead but no one seems to have noticed

“Mass advertising does not continue to survive due to its consumer appeal and relevance; it survives because it is difficult to measure on a return-on-investment basis. It is this very lack of measurement that enables mass advertising to continue – often unchallenged – as a viable communications approach.”
The Customer Differential, Melinda Nykamp, AMACOM, 2001. Page 91

Beneath all of these examples is a reality that the customer is in charge. Change is demanded by the customer. “Meet my needs,” we are saying, “or I will move my business to somebody who will meet my needs.” Or, “I don’t want choice … I want what I want!”

Can We Vote Ana Lucia Off the Island?

Okay, I admit it. I am a fan of "Lost" and have never missed a show.

I am also a user of AOL Instant Messenger. Which means that every time I sign onto my computer IM loads, along with a website from AOL. It's a website that I normally click off pretty fast cause it is aimed at a different audience than me. But they hooked me this morning with a headline: Can We Vote Ana Lucia Off the Island?"

My hand instantly went up as a 'yes' vote, and my fingers unknowingly hit the link to find out more. Let's get rid of Ana and get nice, neurotic Shannon back. I linked across to AOL's 'Lost' site and read all sorts of tidbits.

The Important Thing About This ...

I am sure you don't care a whole lot about my television interests, but what happened to me on AOL's site is yet another demonstration for the power of CONTEXT.

I was not the right audience for AOL's site. But one piece of content that was contextually relevant to my interests and I can no longer just dismiss AOL when it pops up on my computer. They provided enough different content hooks that eventually one of them caught even me.

Maybe it was just luck on their end, but it illustrates one of my principles in communication ... your website should not be written for just one stereotype customer, but should provide plenty of different hooks to lure different kinds of visitors with different needs and interests.

The added plus for this approach is that different kinds of content hooks reveal to you important insights into the visitor's needs and interests. By tracking these click stream selections and matching them to the IP Address or to a registered and logged customer helps you build a profile of their situation so you can use this knowledge to create more effective campaigns.

Tuesday, November 22, 2005

Just a Simple Question to End the Day

Are your clients' bottom lines improved because of what you did for them today?

Talking with Customers

I just posted a comment at What's Your Brand Mantra and I thought I'd share this with you. Jennifer Rice wrote about talking with customers, and as you know that's frequently a topic of this blog. (By the way, that's Jennifer to the left.)

I agree with Jennifer that there is NO one way to get this input; we must get it from every resource we can ... including talking with customers.What we have to be good at is deciphering all the input we get from various sources and use this to make decisions about products, branding, pricing, promotions, service, etc.

For one, I have grown tired of focus groups and like to get input from one-on-one discussions. I also get a lot of insight from our website click stream by posting content options that give the visitor a choice of two different paths. How they go about selecting content is then very instructive.

It is essential to talk to customers. An example, recently a colleague of mine attended a conference with information systems managers. He went to the conference with a predisposed concept that our customers were all doing programming for desktop users and that the mainframe was a dead territory. He observed a lot of attendees who were programming for their company mainframe systems ... and that these were not older managers hanging onto mainframe systems of the past ... they were young, bright and energetic programmers who saw their futures in mainframes. This was an observation that hit our company like ice water in the face. It happened because one of us went out among the unwashed and talked with them while the rest of us sat back at headquarters reading Gartner reports.

What if every manager in your company was required and held accountable for talking to one customer a day? The body of insights would be an incredible competitive advantage.

Second, it is very difficult to get customers to tell you what they want in terms of products. If it does not already exist, they have trouble imagining it. But if you focus your questions on what problems are they having that they cannot now solve and you let them rant on what's wrong, then with a good marketing background we should be able to devise solutions to these unmet needs.

Financial Services Direct Mail Takes a Dive

Despite pouring records amounts of money into direct mail campaigns over the last three years, the financial services industry has been experiencing steadily declining response rates from that effort, according to a report by the Direct Marketing Association. Lead Generation Response rates dropped to 1.43%, down from 2.48% in 2003.

That clearly points out that financial services marketers are doing something wrong. Usually it's the list ... get that wrong and results will plunge. Next, look at the offers ... are they relevant, compelling and unique? Lastly, look at the creative delivery ... is the direct mail saying anything that meshes with the prospect's needs?

Direct mail as a medium has had surprising resilliance over the years. Marketers rely on it consistently ... but if the context is wrong and the mail doesn't work, it could be that some marketers begin mistrusting the medium (instead of themselves).

FACT 1 — Direct mail has NEVER declined in the past 50 years. The Universal McCann Study confirms that by contrast, in the last half-century, radio has declined in just seven of those years. Daily newspapers experienced 8 years of decline or slow growth. Consumer magazines, 8 years. Business Magazines, 9 years. Broadcast TV (developed in the 1950’s) came closest to Direct Mail at just 3 years. So Direct Mail has never even slowed down, let along count it among the disappearing. Instead, direct mail usage has increased each year over the last 50 years!

FACT 2 – During the economic downturn of 1990-91 when the GDP grew by just 1.3%, direct mail grew by 1.5%. All other media declined: Daily newspapers -14.6%, Consumer magazines -11.6%, TV -8.5%.

FACT 3 – Not even price increases in postage and paper have slowed the growth of direct mail. In years of postal increases, DM increased an average of 4.4% and with paper increases, DM grew 4.6%.

FACT 4 – Direct mail’s share of total advertising expenditures in 1960 was 19.0%, in 1980 it was 17.5% and in 2000 it was 22.2%.

FACT 5 – The most recent decade compounded annual growth rate for direct mail when adjusted for inflation has been 1995-2000 at 6.4% and from 2001-2005 at 6.6%.

What Can Marketers Learn
from Japanese Manufacturers

We can deliver effectiveness and efficiency by learning from those who have mastered lean manufacturing and by focusing as much attention on implementation as we have always paid to strategy and creativity. It is in the executional stages that lean marketing can flourish when guided with best practices that help you identify and remove waste from the system.

The disciplined methodology of Lean Manufacturing that was created by Toyota has produced incredible results – not just for Toyota, but for the entire manufacturing industry. Better cars for less money. Better everything for less money.

Lean Marketing can follow the same principles of Lean Manufacturing by attacking our systems where process help is most needed:

-- The ability to convert customer knowledge into competitive advantage
-- The ability to shift from push marketing to pull marketing
-- The ability to bond your marketing and sales people in common direction
-- The ability to use technology to increase quality and speed to market

What must change to improve marketing and sales?

We need to improve in four areas:

-- The ability to produce marketing that outperforms competition moored in old ways
-- The ability to shift from corporate-centric messaging to customer-centric messaging
-- The ability to move, monitor and modify, using lean practices
-- The ability to improve staff performance and productivity to do even better tomorrow

I am going to write at these points more aggressively over the coming year. We need to become lean marketers that produce top line revenue for our companies. For now, let this introduction suffice:

This is a light weight method to get complex marketing done with minimum risk. Light weight does not mean flimsy. It can be stronger than a tank. But compared to the heavy lifting of traditional marketing it is light, fast and simple.

This is not an exercise aimed at reducing headcount in the marketing department. That practice has been done before and has not worked. All it produced was a demoralized marketing team and cost reduction at the expense of quality and responsiveness.

It is not a controlling system.

Instead this is a change process designed to produce greater effectiveness and efficiency so you can grow more quickly. It is a communications and learning system to achieve sustained value creation.

Marketing looked at this way shifts from a variable cost to a variable investment – one charged with creating value for which prospective and current customers will gladly pay a premium price.

The goal is to build lean thinking into every marketing activity until it becomes second-nature.

Monday, November 21, 2005

What's in a Brand Name?


We marketers must have a screw loose. We regard branding as our domain. We're the experts. Follow us.

Well, the marketers at SBC (aka Cingular and/or AT&T Wireless) take the cake for this branding non-sense:

Engadget reports that SBC, which was one of the Baby Bells spun off from AT&T during the big break up of 1984, is officially changing its name to AT&,T and they want to unify all the branding — but man, are things getting confusing.

As you’ll recall, last year Cingular snapped up AT&T Wireless, which had been spun off from AT&T in 2001 for the princely sum of $41 billion. They then spent the better part of the past year spending tons of time and money trying to eliminate the AT&T Wireless brand and integrate its network, subscribers, and services into Cingular.

The integration is pretty much done (or close to it), but now they’re going to go through all that again, except in reverse, which means that some of you out there will go from being AT&T Wireless subcribers, to Cingular subscribers, only to become AT&T Wireless subscribers all over again.
What must the stockholders think of this clever marketing campaign? Does this give you any sense of confidence as a customer that your cell phone provider knows where it's headed and that they will take care of your needs? It sure puts a big question marke in my mind.

Love Thy Distribution Channel

I blog mostly about creating context with customers. Underlying that theme is the concept of loving your customers. They go hand in hand. You can't fake love and customers sniff out fakers a lot faster with gazillions of active bloggers.

The same goes for your distribution channel. If you sell through partners, treat them like partners.

Take Toshiba. As reported in VarBusiness, the once-vaunted notebook manufacturer fell from grace awhile back, losing its leadership position in B2B notebook sales as it dined on surging commercial sales. A large part of the blame, its channel executives admit, was a bungled channel strategy. Pricing across the channel was inconsistent, and its own direct- sales Web site often undercut partners.

The mistakes were costly, as partners stopped pushing or, in some cases, selling Toshiba products. Toshiba's revenue stream is now inverted from its B2B heyday; today, the commercial market accounts for more than 60 percent of its sales. And partner satisfaction? It took last place in this year's VARBusiness Annual Report Card for notebooks.

A data storage client of mine a few years back made the same mistake. The Indirect Channel Group put together a blockbuster direct mail program to make sure its Value Added Resellers were primed to sell Imation products to their customers. At the same time, my client's Retail Channel Group ran a promotion that undercut the pricing offered to VARs. Channel conflict is an ugly thing.

Growing business is paramount, particularly in the midmarket. Toshiba believes premium value, innovation and performance can win the day. Its strategy includes a heavy emphasis on educating partners on Toshiba's value proposition and how its products stack up against competitors. But it acknowledges that growing market share will require demonstrating that partners can make a respectable margin on its products.

Contextual Wisdom says says playing games with channel partners brings down even the best of companies.

Saturday, November 19, 2005

Excuse the Commercial for a Classic Movie

If you're looking for a great movie to watch with the family, consider "Christmas Mountain: The Story of a Cowboy Angel."

You can buy it on eBay for about $64 (a used version from Blockbuster), or you can get a digitally re-mastered new copy for $14.99.

My colleague Steve Kayser worked directly with Mark Miller to obtain rights to re-market this timeless movie ... and my daughter did the graphic design of the DVD cover. So, yeah, I'm proud of them all!

Is it a good movie? Well, the New York Times thought so!

Christmas Mountain is a heartwarming Christmas tale featuring American leading man Mark Miller - writer, producer and star of SAVANNAH SMILES - and his boisterous comic-sidekick, the immortal, eternally lovable, Slim Pickens.

Imprisoned, down-on-his-luck drifter, Gabe Sweet (Mark Miller) is forced to seek redemption by undertaking a Christmas charity mission on behalf of the town. There's only one problem - the "charity" is as empty as the hearts of the townspeople themselves. But, with the help of a dearly-departed Angel wannabe (Slim Pickens), Gabe quickly learns that the ones truly in need are the ones who already have the most.

CHRISTMAS MOUNTAIN: THE STORY OF A COWBOY ANGEL classically captures the timeless magic and spirit of Christmas. In the vein of "Miracle on 34th Street" and "It's a Wonderful Life," join Gabe on his journey of friendship, compassion and understanding - and learn what it means to be truly rich ... in spirit.

A FILM FOR THE ENTIRE FAMILY, YOUNG AND OLD, FOR GENERATIONS TO COME!

Here's the
link to purchase
your copy of Cowboy Angel.

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Friday, November 18, 2005

Personality Traits of B2B Decision Makers

When we want to get inside our prospective and current customers' heads, we can be on the lookout for five traits that help build context.

The following article, entitled "Square Holes for Square Pegs," written by Professor Adrian Furnham, looks at the "Big Five" Model of Personality and makes sound arguments for personality assessment, or success profiling. Consider how you can unearth these traits based on their responses to questionnaires, click path content selections or sales interviews ... and you will be a lot closer to moving that prospect toward a sale.

The Big Five Model of Personality:

According to the "Big Five" model of personality, the most important dimensions of people's personality in the workplace are:

1. Introversion/Extraversion
2. Agreeableness
3. Openness
4. Natural Reactions
5. Conscientiousness

Introversion/Extraversion:
Some people are talkative, sociable, and socially self-confident.

They like other people and tend to be socio-centers. They are comfortable in groups and teams and enjoy intensive and extensive people contact. Others are quiet, retiring, and apparently shy. They prefer to work alone and have a much lower need for social contact of all kinds. This, of course, is introversion-extraversion.The salient question here is about social contact at work: with colleagues and total strangers (i.e. customers). People can be excited, enlivened and energized by social contact, or frightened and exhausted by it.

Agreeableness:

Next, some people tend to be sunny, cheerful, warm and empathic while others are dour, unsympathetic, and grumpy. This is about being hard or softhearted. It's about sensitivity to and interest in the feelings of others. This dimension is called agreeableness. However agreeableness can be a handicap when agreeable managers have to deal with recalcitrant, difficult and disagreeable staff. Their natural warmth and kindness may prevent them from ''kickin' ass'' as frequently as they should.

Openness:

Third, some people are curious, imaginative and artistic, while others are practical and focused. This dimension is called openness to experience. The more open people are, the more prone to boredom they are. They think outside the box too much.

Natural Reactions:

Some people are calm, contented and placid. They are stable under fire, resilient and emotionally robust. Others are easily upset, tense, anxious, moody and highly-strung. It is, in short, the ability to handle pressure and stress. We call this Natural Reactions. Most jobs have some sources of stress. Tight deadlines. Disgruntled customers. Competing demands. Indolent staff. Tough performance standards. At the extreme, people who can't handle stress cave-in with psychosomatic illness, depression or erratic behavior. They can be a menace to themselves, their colleagues and the business.

Conscientiousness:

And finally, there is conscientiousness, the work ethic, diligence, and prudence. Some people are hard working, self-disciplined and well organized. Others are (alas) disorganized, easily distracted and undependable. Conscientious people have self-discipline, drive and a sense of direction. They stay on and come in when required over and above what it says in their contract. They just need a direction and an appropriate reward.

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Sometimes the New Media Get it All Wrong

Yesterday, I opened my AOL Instant Messenger only to learn that I had two new "buddies" I have never met ... and actually don't ever want to meet. I think someone at AOL must have a screw loose. Maybe it's time to switch over to Microsoft.

The two new buddies are a ShoppingBuddy and a Moviefone bot, both automated programs that send preprogrammed responses to queries about shopping and movies. Frankly,Im not looking for a 'shopping buddy' to automatically add itself to my life and promote buying over their network. At least have the courtesy to ask me before sending new buddies into my life.

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Podcast Earns 6 Figure Ad Contract

Fascinating how the new media are taking hold.

Dixie, maker of those tiny little disposable cups and paper plates, issponsoring a new show. It's not a show you've probably heard of though. It's actually a podcast called Mommycast hosted by two moms in Virginia. The two women recently signed a deal that Brandweek writes is "north of six figures."
“We've been researching podcasts for some time,” said Erik Sjogren, senior brand manager of Dixie. “We are trying to speak to the same moms and reach them in the same way Mommycast does. We are an 85-year-brand but we want to be contemporary and find the cutting edge. Perhaps [paper plates] aren't the sexiest category, but we like to think we'll catch some people by surprise." He said the sponsorship coincides with brand renaming and repositioning happening in the spring.
If this does well for Dixie, it'll be interesting to see if other brands begin to woo other podcasters.

Thursday, November 17, 2005

The Fifth P of Marketing - Passion

My associate Louis Columbus, as he so often does, has nailed something so foundational that we can miss it. He writes on the Simplicity Blog:
Nearly every business school teaches the traditional 4Ps of Marketing including product, price, promotion and distributon or place. The key is to sychronize strategies to take each of these aspects into account and create results, either in terms of great channel growth or direct sales. These are the core concepts of Marketing.

In the graduate-level courses I ocassionally teach on Marketing one more P sneaks into the conversation - Passion. Nothing happens in Marketing without passion - and that's a passion to be the change agents of a company, not the holders of the status quo or worse, the historians of the past.

As my class goes through case studies and examples of exemplary marketing one fact emerges: Marketing is as much of a calling as it is a career. Call it an avocation.

Marketing is an act of agresssion against the status quo and it is definitely about making an impact in the market, all in the name of advancing brands, awareness and eventually Sales.

Passion truly is the fifth P of the Marketing mix.


,

How Much is Your Blog Worth

Clever little bit of viral marketing. Check it out yourself and you will add even more value to Dane Carlson's blog where he hosts a nifty tool ... probably not very scientific, but it drove tons of traffic to his blog and the value of his blog went skyhigh.

New Ways to Get Inside Context

Customer minds are tough to get inside. But without it, you will never understand the context in which they see your products.

Ah, let’s plan some focus groups!

Not so fast, Speedy.

We’re all getting smart about focus groups. That mirror sets up a false sense of reality. People in a group say one thing and believe another. It creates what researchers now call ‘false positives’ that can lead to marketplace failure. Besides that, it takes seemingly forever to plan, recruit, travel to remote sites, hire the moderator, run the sessions and analyze the results.

The one I like is conjoint feedback on your own website, or on specially launched research websites, or via interactive emails. Provide the customer two alternatives that are conceived to reveal their real interests or thoughts. For instance, provide choice of a whitepaper on saving money and one on improving results. Provide package design “A” and design “B” – one with a humorous tone and one more serious. Give them the right options and they will tell you what’s important.

Business Week Online took a fresh look at the problem and found a number of clever ways to understand customer context:

Looking for better methods of predicting consumer acceptance, Pepsi recently turned to Wellesley (Mass.)-based Invoke Solutions, which conducted several instant-message-style online panels of 80 to 100 people collected by its affiliated online survey firm, Greenfield Online. Pepsi delved into attitudes among Gen Xers toward drinking mineral water. In just a few hours, the beverage marketer was able to gather and process detailed feedback from hundreds of consumers. Getting a comparable result from focus groups would have taken several weeks.

Speed is just one of the appeals for political strategists shifting from traditional focus groups to online research. Mark Mellman, president of Washington's Mellman Group Inc., recently used Invoke on behalf of Planned Parenthood. A series of online panels totaling hundreds of people shared attitudes about U.S. Supreme Court Justice John G. Roberts Jr. and abortion rights, and inspired the messaging for ads. Mellman figures he'll use the method for candidates as well. The savings and speed, he says, lets him reach more diverse voters than focus groups allow -- beyond those "who simply have a few hours on their hands and want the $50 fee."

A Kimberly Clark packaging designer came up with a new approach: a camera mounted on a pair of glasses to be worn by consumers at home, so researchers could see through their eyes. The cameras let KC see what the customer was looking at, rather than pointing the camera at them.

It didn't take long to spot the opportunities. While women in groups talked about changing babies at a diaper table, the truth was they changed them on beds, floors, and on top of washing machines in awkward positions. The researchers could see they were struggling with wipe containers and lotions requiring two hands. The company redesigned the wipe package with a push-button one-handed dispenser and designed lotion and shampoo bottles that can be grabbed and dispensed easily with one hand.


What is Content Worth to You?

How many times will you pay for the same content? Apparently a lot according to a newsletter by Shelly Palmer -- "Online Spin" from MediaPost. The key is that producers keep a wall around formats so they can squeeze all the lemon juice.

99¢ to purchase a song on iTunes
$2.49 to download a portion of that song as a ringtone
$1.99 to use a portion of that song as a ringback tone
$1.99 on iTunes to purchase a download of the video for that song
$1.49--for a still image of the artist to use as wallpaper on your mobile device
$14.99 for the DVD of the movie that features that song
$19.99 for the CD of the album that includes that song
$3.95 to watch the pay-per-view or video-on-demand version of the movie
$6.95 for the HD VOD concert that features the same song
$12.95 per month for the subscription to HBO that will broadcast the movie and the concert on the cable company's linear and VOD channels
$12.95 per month to a satellite radio company where you can hear the song

So, fellow marketer, are you squeezing all the juice for your company?

We Now Live in Drucker's Age of Discontinuity

I promised myself the other day to re-read my copy of Peter Drucker’s Age of Discontinuity. Of all his books, I remembered this one as the most important, but I have not read it in for over a decade. Shame on me.

But picking up my old, somewhat yellowed copy felt good the second I opened it up. There were all my underlinings and sidenotes written into the book in my previous readings. My first observation as I scanned my sidenotes: this man made me think.

The first responsibility of managers, Drucker said, was to ask themselves a simple question: What is your business? He was of the opinion that only the customer could really answer. That was a statement made way ahead of the current CRM boom. And yet it is a definitional problem that most managers still struggle with. At least I do.

Getting a handle on “what is our business” is deceptively difficult. I work for a software company. So the deceptively easy answer is that we are a software company. Wrong. At least in the eyes of our customers. They told us we were in the business of helping them to simplify complex business processes so they could make better, faster decisions.

Drucker brought clarity to discontinuities that he saw well ahead of his contemporaries. Scanning his classic book, he picked off issues that were predictive. They are issues that we now are struggling with in one business after another.

New technologies are upon us. Drucker could not envision the PC and the Internet, but his book was an early warning system on what we would have to ponder as technology became ubiquitous.

He saw the implications of the global economy before it resembled what we now live in. “The world has become one market, one global shopping center” … “yet this world economy almost entirely lacks economic institutions to energize global productivity” that could lift poor and largely colored nations out of poverty … we stood the probability of a new war between races. (Did Drucker actually see the Jihad coming?)

He saw the approaching disenchantment with big and cumbersome institutions – universities, hospitals, businesses, governments. And he warned we were not prepared for this complexity.

He challenged us 40 years ago to prepare for the Knowledge Revolution.

Big discontinuities seen so long ago and yet unresolved in this world.

Drucker does make you think. Even after his passing.

Wednesday, November 16, 2005

Winter. Ugh. Where's a Travel Agent when I Need One?

Just sitting here trying to survive a really terrible chest cough. Looking out my window and it's starting to flurry some white stuff. Get me out of here! Where's the travel agent from the Phoenix Visitors Bureau when I need her ... maybe I'll go to their website. Quick, send me one of those personalized eBrochures and be sure to talk about how warm it is. Or maybe I should head for Florida or the Outer Banks where we normally head for "time out" -- but that might not be far enough south for my mood now. Maybe a cruise to the Virgin Islands. Are there any islands left out there since Wilma and Katrina? Where's that travel agent when you need one?

Google Base to Rival eBay and Craigs List

Google, perhaps the one technology company that truly understands one-to-one marketing continues to show its mastery with yet another contextually relevant service:

Google Base, is a new service that allows users to post and make searchable anything from recipes to help wanted ads, goes live in beta form today, triggering what Piper Jaffray analyst Safa Rashtchy says will be a new era for buying and selling things online.

Google Base, he says will be even easier and more efficient than Craigslist or eBay, which is complicated by a time-consuming listing process and vast numbers of international sellers who take too long to deliver products.

Rashtchy says "ecommerce 3.0"--powered by Google, of course--will connect buyers and sellers on an even more local level by leveraging its e-mail, satellite mapping and shopping services. Craigslist, which certainly connects local buyers and sellers, lacks the fundamental search technology to connect even greater numbers of people locally.

Customized eBrochures a Big Hit for Phoenix

Karen Gedney writing for Clickz.com has another case of precision marketing that allows each prospective customer to produce perfectly relevant brochures. The case is the Greater Phoenix Convention & Visitors Bureau. Their problem: potential visitors had to wait up to 8 weeks to receive travel literature from the Bureau. By then, many prospects had moved on and selected a different vacation site.

The Bureau cut 8 weeks down to a real-time response with personally produced travel brochures. The visitors check off items that are important to them: shopping, outdoor adventures, arts, golf, entertainment. This is then matched up to the travel database and instantly a customized, link-laden email is sent off. 35% of those getting this personalized eBrochure click on the links to learn what Phoenix uniquely offers them.

The Bureau can observe which links are selected, (and if they are really tuned into the visitor, they would then followup with additional information further customized). While the real benefit is contextually relevant information put in the hands of prospects in real time, the nice little bonus is that the Bureau saves the $10 it formerly spent on generic brochures sent to prospects via the post office.

Can You Convert Your Brand to a Lovemark?

Lovemarks, by Kevin Roberts CEO Worldwide of Saatchi & Saatchi

Traditional Branding .... Lovemark Branding

Brand ............................ Lovemark
Recognized by consumers ... Loved by People
Generic .................... Personal
Presents a narrative .......... Creates a Love story
The promise of quality ......... A touch of Sensuality
Symbolic ................... Iconic
Defined .................... Infused
Statement .................. Story
Defined attributes ......... Wrapped in Mystery
Values ..................... Spirit
Professional ............... Passionately Creative
Advertising agency ......... Ideas company

To this list of lovemark attributes, I would add only one:

True to All ................ Relevant to One

The brand message that is true to the universe will likely be some piece of rhetoric that has no meaning at all. To be loved, is a personal experience. Your brand should be relevant to me and then I will feel it.

Putting Context to Work in the Doctor's Office

Now here's context, alive on the web:

The surgeon has a patient with a certain kind of fracture in the leg. The AO Foundation, a global nonprofit network of 250,000 surgeons involved primarily in osteopathy, has a web portal with a clickable map of a human, so a surgeon could click on the effected part of the leg, specify that a fracture has taken place, and get detailed drawings, photographs, and even "teaching videos" of other fractures. WP Experts, the architect of this system, has created links to AO Foundation's back-end systems, including an enterprise content management system and IBM DB2 databases, so as to be able to pull up and serve relevant information in any specified context.

People tend to learn contextually, so presenting information in context is a way of ensuring better education and not just supporting a one-off procedure.

"There was a study that found that, if a surgeon read new publications for two hours a day, he'd still be 1,000 hours behind at the end of a year," says WP's Oliver Trabert, expanding on the virtues of contextual learning.

Monday, November 14, 2005

Hotlanta On the Road to Boring Brand

Is Atlanta's new slogan contextually relevant?

Al Ries thinks not and Al Ries knows branding for sure.

He writes in Ad Age:

Although it has become widely known as 'Hotlanta,' Atlanta elected to invent a new slogan for its brand campaign.

After 8 months of gestation, the new logotype and theme for the Brand Atlanta campaign was just introduced.

“Opportunity. Optimism. Openness” is the new, compelling branding strategy backed by a red-and-white trademark with the letters “ATL” highlighted.

Opportunity, optimism, openness: Sounds like a slogan for the state of Ohio and not a very good one at that. I’ll guarantee that few people will remember the three Os, let alone connect them with a name that doesn’t have a single O in it.
Al goes on to further chide Atlanta for abandoning a brand it already owned in our minds ... but notes some pretty big companies have made the same mistake.

You get a new ad agency and the first thing they want to do is reposition the brand (cause they sure won't win any awards using some other agency's branding).

Our company, Cincom Systems, has recently launched a new brand ... well, actually, we kind of re-launched our old brand. For a few years, we had veered off with a slogan that emphasized our experience in the software industry. We returned to our roots with branding built around what Cincom Systems has done well for 37 years ... build and market software that simplifies complex business processes.

So maybe it's not too late for the Mayor of Atlanta to ditch the O's and return with gusto to 'Hotlanta' -- a slogan that breathes excitement into one of the fastest growing cities and entertainment destinations in America.

He Was the Man from whom to Learn
How Business Worked

For those who may have missed it in the news, Peter Drucker died this past Friday at the age of 95. Some 20 years ago, a young college graduate we had hired asked me what he could do to get ahead faster. I gave him five books by Drucker and told him to study them as if his life depended upon it.

I’d still give that advice. Drucker made everything simple and that’s not easy to do. He understood how complexity ground businesses down when managers stepped out of their area of expertise and created too many products, made by too many people and tried to be all things to all people.

The young graduate returned the books unread. "I just spent four years reading books and I don't want to do it anymore." He never made it at our agency, and I'd be willing to bet he never made it anywhere.

Peter Drucker's passing reminds me that I have not re-read his books in a long time. I think I will get out The Age of Discontinuity tonight.

Sunday, November 13, 2005

Medical Center Blogging Builds Trust

Context within a medical center ... delivered by of all things, one of the first blogs from a healthcare provider.

Toby Bloomberg at Diva Marketing has a great profile on why Windber Medical Center's CEO Nicholas Jacob took the risk of blogging out in the public. What's so remarkable to me is the honest candor that ripples through Nick's postings ... it almost makes me want to hug him for being so forthright.

Nick's words about contextual relevance ... what mattered most to patients:

"It was about transforming a hospital into the best of a hotel and the best of a spa. Our philosophy was not just to create something that people would like. We, in fact, were interested only in creating something that people would absolutely love."
Read Nick's Blog and you will see for yourself how this medium can transform communications and customer relationships.

Thanks, Toby for getting the bead on this great story.

Friday, November 11, 2005

For the love of a good shave

Put it into context.

Men, do you want a 15-blade razor. If so, take a look at this witty commercial. The advertisers hope to change the rules from rampaging blade count to smoother, more comfortable shave. Using electric-powered blades and Nivea lotion instead.

The online ad features a place where viewers can email the ad to their friends ... to start a massive word-of-mouth campaign. It's all outrageous enough that the pass-along ad will, I think, get big results.

Monday, November 07, 2005

Selling Customer Service at a Premium Profit

Let's put it into context.

If you're buying a $13 million jet aircraft engine, is getting the cheapest price or the best service more important?

Reveries reports that Rolls Royce proves that customers want and need service.

"Over the past 15 years," Rolls-Royce "has clawed its way up from bit player to No. 2 in the market for commercial airliner engines" via a deft combination of product, and -- even more important -- service, reports Stanley Reed in BusinessWeek (11/14/05). You may recall that Rolls nearly went out of business "in the 1970s before the British government took it over," keeping the aircraft engine business and selling off the motor car division. The critical moment for Rolls (which has been around 101 years) actually came in 1996, when "John Rose, a reticent former banker" became chief executive officer. Rose not only "pushed hard to broaden Rolls's product offerings" but also to provide maintenance services to match.

For Rolls, the service-and-maintenance part was key, because the margins in it are in the 30 percent range, far outstripping "those for original engine sales (monster turbofans, which may list for as much as $13.5 million a piece, are often sold at big discounts to win orders)." As a result, Rolls-Royce, www.rolls-royce.com, today has "one of the world's most sophisticated help desks. Using live satellite feeds displayed on video screens, its technicians continuously monitor the health of some 3,000 engines for 45 airline customers." Naturally, product design figures prominently into the service side, as "the layout of Rolls-Royce engines makes them easy to work on." Rolls packages it all up in a plan "called TotalCare, under which" customers pay them "a fee for every hour the engine is in flight.

In return, Rolls assumes the risks and costs of downtime and repairs." The upshot: "Rolls is incentivized to put expensive modifications into the engine to improve reliability," notes Bob Reding, svp for technical operations of American Airlines, "which operates 178 Rolls-powered planes." Some customers gripe that Rolls's "maintenance costs are well above those of the competition," but for the most part that doesn't seem to be hurting them any: "The company says it has clinched 86 percent of engine orders for the new Boeing 787, and orders for the Airbus A380 are evenly split with GE." According to analyst Sandy Morris of ABN Amro, Rolls Royce Group is poised to enjoy "a 65 percent year-on-year increase in operating profits in 2005" and investors "have bid them up 46 percent since the beginning of this year."

Does this work just for complex business-to-business companies? Nope. Customer service gets right down to the level of the grocery store. An independent researcher discovered that the vaunted TESCO, the leading UK supermarket, is vulnerable to a competitor's superior customer service.

As TESCO announces record profits and consolidates top ranking in the UKgrocery retail market, figures released today from independent customer loyalty experts TARP UK, show that TESCO`s business remains vulnerable to ASDA on service. But the general lack of service quality across the industry is costing the supermarkets GBP20billion P.A. as 3/4 of supermarket shoppers would happily shop at another retailer. The defining factor is staff availability and checkout service - not price or store location.

-- 43% of ASDA customers were very satisfied, compared to

-- 34% of Sainsbury`s customers, and

-- ONLY 37% of TESCO customers were very satisfied.

-- 32% would ALWAYS use ASDA if at all possible, compared to only

-- 19% of Sainsbury`s shoppers, and

-- ONLY 25% of TESCO shoppers.

Which is to suggest that when you're building any marketing program, you should be putting as much effort into improving customer service as you put into product development. Given the option, customers will opt for service.

Friday, November 04, 2005

Adams Theory Applied to CRM

The Theory Summarized

The Adams’ Equity Theory is named for John Stacey Adams, a workplace and behavioral psychologist, who developed this job motivation theory in 1963. Much like many of the more prevalent theories of motivation (theories by Maslow’s Hierarchy of Needs, Herzberg’s Theory, etc.), the Adams’ Equity Theory acknowledges that subtle and variable factors affect an employee’s assessment and perception of their relationship with their work and their employer.

The theory is built-on the belief that employees become de-motivated, both in relation to their job and their employer, if they feel as though their inputs are greater than the outputs. Employees can be expected to respond to this is different ways, including de-motivation (generally to the extent the employee perceives the disparity between the inputs and the outputs exist), reduced effort, becoming disgruntled, or, in more extreme cases, perhaps even disruptive.

Adams’ Equity Theory calls for a fair balance to be struck between an employee’s inputs (hard work, skill level, tolerance, enthusiasm, etc.) and an employee’s outputs (salary, benefits, intangibles such as recognition, etc.). According to the theory, finding this fair balance serves to ensure a strong and productive relationship is achieved with the employee, with the overall result being contented, motivated employees.

Applying Adams to Customer Relationships

We can all sense how the Adams Theory applies to our worklife from our own experience. Same goes for us as customers. When a relationship with a vendor becomes lopsided, we walk. If it is lopsided in our direction, the vendor walks. It calls for the classic "win-win" where we all feel good.

When a vendor makes a contract onerous, or the price is too high for the value we get, or the vendor's service disappoints us ... we strike out with word of mouth or viral blogging that in some cases has destroyed brands virtually overnight.

I can still remember from two decades ago when the vendor had all the consumer data. Then came scanner data and suddenly the retailer had the data. The data in both cases brought power that was then abused. The win-win relationships were pitched out as each side sought to take advantage of the other.

Another example: Wal-Mart becomes so powerful that it can dictate terms to its vendors, and even giant companies like P&G cowtail to stay in favor and keep their merchandise on the shelves.

Better if we all come to realize the real power in Adams Theory. Keep a balance on the inputs and outputs and both sides will prosper.

Okay, Dale, that's a long winded way of getting to Customer Relationship Management (CRM). Optimizing profit is what we're all paid to do. But if we optimize at the expense of the customer, the relationship part of CRM is dead. It just all calls for a sense of balance. Deliver high value at a low cost with a rapid return on the investment, but do it with optimized profit by squeezing waste from all our systems.

Google Changes Advertising
Nielsen TV Ratings Feeling Pain

It happened again! It happens so often in business. Superior performance by a competitor sets a new benchmark in our minds. Once we experience superior performance we don't want to give it up. Google has turned the world upside down for mass marketers ... and even for the companies that measure advertising performance.

Google has shown us that ads work better when they are contextually relevant to the customer's situation. Google is now garnering more advertising revenue than the TV networks. And the house of cards is beginning to fall. The dominos are tipping each other over.

Nielsen has just changed the way it will measure TV viewership, and it will begin to expose the inherent weakness of advertising.

Nielsen will now provide minute-by-minute ratings, but will not measure those precious minutes when the commercials are actually running. They could, but they won't. Why not? Isn't that what we as marketers really want to know? We don't really care that "Lost" is the top rated show on TV. What we want to know is if our commercials on "Lost" are getting viewed.

Anyone with an ounce of sense can see through Nielsen's measures. They could tell us what we want to know, but they won't tell us. Nielsen (like the rest of us) know that when the commercials come on we are talking, going to the bathroom, grabbing a beer or snack and that we only get back in front of the tube when the commercials have aired. They also know that if we as marketers saw these real performance numbers, we'd stop wasting our money on campaigns that no longer work cost effectively (and then Nielsen would no longer have a reason to measure TV and they'd be out of business). Sort of a catch-22 situation for Nielsen and the networks.

This old system of measurement really should be dumped and replaced with a system like Ad ID and other "marker" technology used by viral marketers to track viewership of viral video. The thing gets viewed, it gets counted. It doesn't get viewed, it doesn't get counted. That doesn't happen with Nielsen.

Putting messages in front of prospective customers works when the messages are relevant to our needs. This means the message must match up with individual data instead of demographic mass data. This means the message hits us when we are actually in the market to buy stuff ... how many car commercials pass before my eyes when I my current car lease has two more years to go.

Technology is getting close to its ability to match viewers with one-to-one commercial messages. Perhaps it will happen just in time to save our favorite TV programs from extinction.

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