Posts Tagged ‘positioning’

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Building Critical Marketing Mass

Wednesday, August 20th, 2014

building

“If it’s worth doing, it’s worth doing well. If it can’t be done well, it’s not worth doing at all.” -Proverb

Imagine placing fifty cents into millions of vending machines, all of which require a dollar before you can get anything out of them. In the end, you’ve spent a fortune and absolutely nothing to show for it. You wouldn’t do anything this foolish with your money- right?

But in business, we’re all guilty of doing just that. We spend countless hours writing marketing plans and brainstorming tactics, sometimes even coming up with something both original and brilliant. That original and brilliant idea then goes into the plan with all of the other brilliant initiatives the budget is spread out across all of these smart things we think we need to do.

The problem is that none of these initiatives has any chance of reaching critical mass.

Why? Imagine a line that moves through time. Above this imaginary line you capture your audience’s attention, below this line you don’t. It really can be this absolute, since there is no such thing as almost getting noticed. I always preferred to run well below the line for most of the year, which allowed me to focus my resources and take at least one really strong leap above the line annually.

Limited opportunity for attention means that you need to take each of your tactics or marketing initiatives and prioritize them based on such criteria as strategic importance, marketplace impact and expected cost efficiency. Next, calculate the ‘cost of success’  for each of these initiatives. The ‘cost of success’ should be a real, honest assessment of what it will take for this initiative to work in the marketplace. It’s easy to underestimate how much it takes to get attention from real people out in the real world.

Now, determine how many of your priorities you can afford before you budget runs out. These should be the only projects that get the green light. Do it to effect or don’t do it at all needs to be your guiding philosophy. Once again, be absolutely ruthless with your priority setting. You’ll end up doing less, but you’ll do better.

All of this is just common sense. So why is it so hard to do?

Answer: politics and organizational structure. Different groups want their slice of the budget and it’s hard to say no. A leading retailer with whom I worked with many years ago had a marketing budget in excess of $500 million. Lots of potential for critical mass there. But by the time it was divided amongst every department, critical mass was nowhere to be found.

This is exactly the wrong approach, because for all that money spent, no single initiative ever rose above that invisible attention-getting line. Had the company focused the budget on a smaller number of high priority marketing programs, it could have had a huge marketplace impact throughout the year.

The task, then, is to create critical mass, somehow, somewhere, sometime. This may seem like a dream to some marketers, but that’s an error of perspective. It’s far better to get noticed by one person than to get almost noticed by thousands. Should we be content to forever fall short? It’s the CFO’s fault- right?

So how do you actively create critical mass?

-Believe in what you’ve just read here and apply it ruthlessly

-Limit your core audience

-Limit your geography

-Limit the time frame

-Limit the media mix

-Limit the vehicles used within the selected medium, even if it means advertising in a single television program. (But own that show!)

In other words, always own a slice of a communications channel- and therefore of your prospect’s attention- no matter how thin that slice might be. Then use success on that narrow front to gain a bigger budget and thicker slice.

Meanwhile, it’s good practice to test a few of the proposed initiatives that didn’t make the cut. Test them in a limited geography, time frame or against a limited audience. Once you have a sense of their positive potential, flag those initiatives for next year’s critical mass priority.

Tune in next week when Austin lures us back into the proverbial ‘box’ and gets your brand back on strategy.

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The Joys of Disruption

Monday, August 11th, 2014

Brands and brand strategies can be viewed as conceptual frameworks that demand consistency of execution. It follows then that brands promote continuity. Competition disrupts continuity. So if you are not acting disruptively, odds are that a disruption will be visited upon you by someone you might not have even realized was a competitor.

The point is that you must do everything possible to be disruptive. Strategically disruptive. Disruptive at the product or service level. Disruptive at the marketing communication level. If you want my attention, you need to disrupt whatever else is holding my attention. If you want my business, you need to disrupt whatever is causing me to do business with someone else.

Remember, attention has become the most precious commodity in the marketplace. Also recall how difficult it is to create real change.

There’s a problem with staying in the center of the strategic “box.” This kind of behavior gets an A+ for consistency but a D- for attention-getting. Tactically, your job as a marketer is to bang the hell out of the walls of that box, all while still staying inside. In other words, get creative. Make noise. Promote change. Always keep moving. Always keep building. Always stay “in-strategy.” But first and foremost, always make noise.

Generally, the only way to ensure a discontinuity is to create it yourself. Whatever that discontinuity is, it must work to your advantage, and therefore must play into your brand strategy.

Napster disrupted the music market, but in a way that could never make money. Apple disrupted the music market in a way that did make money- generally a better approach.

Yahoo! disrupted the way we find information, but then acted as if it had no idea what it had done. Google knew.

In fact, when you look at the big four- Apple, Amazon, Google and Facebook- they are in the process of disrupting about a hundred different markets. You may not think  you compete with these guys, but the odds are that sooner or later you will. Don’t wast energy figuring out if this is true or not, just figure out the how of the disruption- then beat them to it and make it work to your advantage.

Amazon sold books, but created a disruption through the Kindle. In some ways the company even attacked its own business in order to build that business. If Amazon hadn’t developed Kindle, the book business would’ve been disrupted by- you guessed it- Apple. This disruption would have been terrific- as long as you work in Cupertino and not Seattle.

Today, Google owns the idea of search. Now it’s up to some aggressive new player to create a new discontinuity, one that works to the advantage of its brand strategy. Search is now ubiquitous- it is indeed the Internet’s killer app- but therein lies both Google’s opportunity and its vulnerability. Search has begun to splinter into several specialized segments. Who will own music search? Who will own television search? Who will own local search?

If strong specialists don’t disrupt the flow, Google will own all of the segments because it now has continuity working for it. Bing proved to be insufficiently disruptive, attacking Google head-on instead of doing something different- something truly disruptive.

Unless someone creates a true disruption, Google will continue to control the agenda. But the reality is that the brand most likely to disrupt the search market in some way is Google itself. Why? Because Google is really good at it. Disruption is hardwired into its DNA.

Check back next week when Austin challenges tackles the ‘M’ word–Marketing,  and learn more now by reading Brand Is a Four Letter Word

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Niche is Not a Four-letter Word

Monday, August 4th, 2014

Whereas the word brand often seems like a spiritual invocation, in many marketing circles the word niche is often spoken with derision and used as a put down.

As far as niche goes, perhaps the most egregious errors of judgement were made in the technology marketplace of the late 90s, when niche became a curse you placed on any idea you wanted to kill or competitor you wanted to insult. Niche companies just weren’t going to make it. Niche start-ups just weren’t going to get the needed venture capital. Niches were for small-time players, the fearful, people with limited vision.

Well, I have always loved niche brands, never forgetting that bigger can indeed be better, particularly in the old economy. Needless to say, however, the Web has changed the way we think.

In 2006, Wired Editor Chris Anderson published The Long Tail, which highlighted how universal Web access meant that even the most thinly sliced niches could still add up to significant business when physical restrictions were taken out of the equation. For example, part of the dominance of big media content has always been physically derived: Limited space on a television channel or with a cable operator. Limited space on your local cinema screen, in a video rental store, in a music store or on a bookshelf. By comparison, digital distribution, universal access and search tools have created unlimited usable space, which has begun to make for an absolutely fascinating media marketplace that will become even more compelling in the years to come.

Niche brands understand the “position narrow, catch wide” axiom of brand strategy. They have built a limited, but fervent following first. They own their segment and enjoy the higher margins that general accrue to smart niche marketers. It’s not a bad place to stay.

Yes, it’s true, businesses are, as the cliche goes, like sharks: If they stop moving forward, they’ll die. But moving forward and getting big are two very different things. Who says you need to be big? A VC will if you’re a start-up, which is why many of those VCs are fully responsible for killing businesses that would have survived their first downturn if they had been rigged to run in niche-mode rather than artificially scaled to run big. Once you’re publicly traded, the street will demand top-line growth- until you teach your shareholders to invest in your consistent profitability rather than your explosive growth.

Owning a highly profitable niche is a thing to be celebrated. Don’t make the mistake of assuming that it is a natural and evolutionary step to move out of that niche and compete on a larger and more competitive stage. For now, at least, you may be much better off staying just where you are. Also, keep in mind that several focused and successful niche plays might well offer the better path to higher revenue, higher margins and less risk exposure than one big, broad play.

Large packaged goods companies offer wonderful lessons about niches. Each year entrepreneurial start-ups create niche products that, either slowly or very quickly, build a loyal and passionate following. Once they get “big enough,” they are acquired by a larger packaged goods company in that category. Interestingly, if that same very successful idea had originally been created within the larger, acquiring company, it would have been deemed too small (or niche) to warrant the investment necessary to take it to market. Often, there isn’t the passion and patience in larger companies to build a niche brand, but there does seem to be the money to pay for that brand once it’s an independent success.

Case in Point:

kelloggs

In my early days of marketing at Kellogg’s, I once sat in a meeting and watched chairman Bill LaMothe get a hard sell on the idea of getting Kellogg’s into the manufacturing of private-label cereal.

He replied, categorically, that they would never do that on his watch. He believed that companies and manufacturing facilities could only accommodate one level of quality. If Kellogg’s were to attempt to make both high and low-quality cereal within the same factory, ultimately both would work their way to the middle. What would Kellogg’s stand for then?

LaMothe was happy to pass up a short-term opportunity to preserve the long-term health of his company. He also passed up a number of opportunities to diversify Kellogg’s through acquisition, taking a lot of criticism from analysts until all those other CPG acquisitions flopped. Bill LaMothe was a visionary. He knew Kellogg’s and its niche better than anyone alive, and the company is so much better today because of the revenue-limiting decisions he made along the way.

Remember, there’s nothing wrong, and a lot of things right, with truly excelling at one thing. Thinking small can actually be the best path to a big result.

Stop back in, next week, as Austin delves into the Joys of Disruption

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Position Narrow, Catch Wide

Monday, July 21st, 2014

I think I first heard the above expression from Alpa Pandya, a colleague of mine at Sterling, and I’m happy to give her full credit for it.

Although obvious to the best marketers, “position narrow, catch wide” seems counterintuitive to nearly everyone else. I means that if you want to appeal to a wide audience you must position yourself in a narrow, specific way. Its corollary is that if you try to be a lot of things to a lot of people, you will be nothing to nobody. A friend read the phrase and told me about an old radio commercial that began: “Men! And that includes you girls.”

Another, similar saying: “Positioning is the art of sacrifice.” In other words, done right, great positioning is subtractive in nature, not additive. The road is filled with tough sacrifices you must make if you are to achieve a narrow focus.

Think of real life. The people we admire most are those who stand for something specific. They have a point of view and it’s simply not negotiable. The people who get the attention of the media (for better and sometimes for worse) are also those with a strong, specific and narrow point of view.

In marketing as well as life, it takes nerve to position narrow, which is perhaps why entrepreneurs are so much more successful at it than professional brand managers. Positioning narrow entails finding your core audience, understanding it and building a sustainable relationship. Once you’ve done that, you can enlist that core to help the rest of the world “discover” you.

nike

Ideally, then, you want a core audience that is inspirational to others. Nike is a great example of this. It’s clear to everyone on the Nike campus and across the marketplace that Nike is a brand for the high-performance, highly competitive athlete. That said, Nike also knows that about 80 percent of its shoes are worn by people like me, often simply to go grocery shopping. Why do we buy high performance shoes if we live low-performance lives? Because we all think we have a bit of that high-performance athlete in us. And because we all feel we need to be ready and equipped to perform, even if we never do.

Nike’s message? Don’t confuse your core customer with your target market.

That said, within the organization, we first want everyone to know we are building our brand for our core customer. This is important because we want every employee to know the people for whom they are designing products, experiences and marketing. Ideally, we want everyone to have a single customer in mind. Why? Because life is so much simpler when you are designing for a solitary person instead of a faceless demographic. Ideally, we want every single employee working on the same product experience to have that same individual in mind. The long term goal, of course, is to have everyone outside the organization also understand the individual we are building for- and we want them to aspire to be more like that person.

Once all of this is in place, we then want to reach out to those who can best help us achieve our objectives. This might be limited to our core audience (remember the need for critical mass), but it might just as easily be directed toward those legions of undecided buyers.

In practice, this means our core audience is unequalled in importance. They are the people we are working for, the people for whom our brand is built. With luck, others aspire to be more like them. But that is a completely separate issue from identifying our target market when it comes to communication. In other words, target narrow, reach wide.

Cadillac New Logo

When Cadillac moved to restage its brand, which was (accurately) stigmatized as being only for old folks, the first thing the company did was design a product that would appeal to younger drivers. Cadillac hit pay dirt when rap stars began snapping up the Escalade, and the marketing team quickly saw the opportunity to position the model as the prestige SUV of the hip-hop set. This opened the door to the brand embarking on a massive shift toward high-performance luxury cars that continues to this day.

googleIn what may be the whopper of all narrow product positions, Google has specialized in and come to own a simple idea: Search. In the early days of Google, lots of “expert” commentators criticized this model as limited and overly specialized. But we’ve all now come to see that Search, by sucking away advertising dollars from every industry (all while appearing completely benign) was the killer application to end all killer applications. as we continue to expand our use of the Internet, search will be the one unifying “tool” that almost all activities pass through.

If Google teaches us anything, it is to not confuse how narrowly you position your offering with the ultimate size of your business. Indeed, it’s often an inverse relationship: the narrower the position, the broader the ultimate audience. Just look to Google- the narrowest and simplest of positions, and the widest of all catches.

Position narrow/ catch wide also applies to corporate communications. Way too much PR, advertising and point-of-sale copy is written with the belief that it is possible to convey complex information to its target audience. It almost never works. Not because the audience isn’t smart enough, but because it isn’t interested enough. Instead, you have to focus the message, whatever that message might be. As I used to tell clients when I worked in advertising- you can say whatever you want, but it’s only what they hear that counts.

Strategy, positioning and communication: in their best forms they are all acts of sacrifice.

Stay tuned- next time Austin shares how to Own your new position

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Love Me or Hate Me- Just Don’t Like Me

Monday, July 14th, 2014

Positions polarize.

What you don’t do and what you’re willing to give up is often more important that what you do and keep. Don’t be afraid. The better you are at creating a strong, clear brand position, the more likely you are to find a group of people who really don’t like you. As Bill Cosby once said, “I don’t know the key to success, but the key to failure is trying to please everybody.”

and1

The And1 website used to feature an extreme example of this point. Addressing the meaning behind its name, the basketball apparel company announced: “If you don’t know what it means, we don’t want you wearing our shoes.”

It’s like life: the only way to have everyone like you is to avoid taking a controversial stance on anything. If you are willing to be anything to anybody- to surrender your identity and your individuality- no one will have strong feelings about you either way. You won’t stand out to anyone and you won’t offend anyone. You simply won’t matter. Is that the fate you want?

In business, a dull existence means a weak brand. If you want some people to love you, you’ve got to accept that others may hate you. With your company clamoring for new customers and more business, it takes a certain amount of nerve to deliberately ignore people that many within your organization might consider prospects.

After an American took second place in the Olympics, Nike CEO Phil Knight was quoted as saying,”He didn’t win the silver, he lost the gold.” Polarizing? You bet. Clear positioning? Hell yes! Nike is unabashedly a culture built around winning, and if you can’t take the heat you have no business in that kitchen. Maybe it wasn’t the most sensitive thing to say. Perhaps Mr. Knight would like a do-over on that quote. But more likely not.

Can you find fault with this kind of corporate culture? Definitely. Is this a culture for everyone? Definitely not. Do you know exactly where this company and brand stand? Most emphatically yes.

ems

Eastern Mountain Sports (EMS) is an example of a retailer that completely lost its way. EMS started out as a genuinely hardcore outdoor retailer for genuinely hardcore outdoor types. But in an attempt to drive revenue, the thirty-seven-year-old company repositioned itself as a mainstream outdoors retailer, stocking its shelves with lots of soft, fleecy and approachable stuff. Well, no surprise: the new me-too retailing didn’t drive revenue. Enter, in 2003, new CEO Jim Manzer, who described EMS at the time as a “Gap with climbing ropes.”

Manzer understood positioning and he definitely understood the need to be different. In the years since taking over, Manzer has taken the company back to its original position, beginning with restoring the hard-core outdoor culture within the company and creating a much more authentic retail experience. Polarizing? You’d better believe it.

EMS makes me think of a new business pitch we once made to Eddie Bauer when I ran Cole & Weber. The meeting spun out of control when I began arguing with the then-head of marketing. The rest of my pitch team was appalled. We had just made a very strong case for the unique and therefore truly differentiating characteristics of the Eddie Bauer brand. I was informed politely that I didn’t really get retail, and that success could only be found in becoming more like Gap (and other similar retailers). I responded that America already had a Gap and didn’t need another one. In my mind I definitely won the argument, but we most definitely lost the pitch. (Did you know arguing with a potential client is not an approved new-business approach?)

And though I lost the battle, Eddie Bauer ultimately lost the war. Arguing may not work in new-business pitches, but “me-too” doesn’t work in marketing.

Polarization is good. Traveling the middle road, tempting as it may be, is always and unequivocally bad. Like people, brands a defined by the company they keep. But they’re also defined by the company they don’t keep.

Stay tuned for more tips to help hold or pivot your position from Austin McGhie, Sterling Strategy

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Invent, Don’t Construct

Tuesday, July 8th, 2014

Analysis is great, but creating true differentiation is essentially a leap of faith.

Differentiation is seldom achieved purely through analytical rigor. Analysis and incrementalism still have their place in business, just not in the actual creation of differentiation.

The answer is to know everything. Strive to be more analytically rigorous than your competitors but also assume they’re looking at the same data and probably arriving at very similar conclusions. As heard in the movie The Incredibles: “When everyone is super, no one is.”

So go ahead and build that mountain of information. After that, climb to the summit and look around. Then leap off. Use science to get  you to the top, art to guide your leap.

That which is static and repetitive is boring. That which is dynamic and random is confusing. In between lies art.

John Locke

Two well-known books by Malcolm Gladwell (Blink) and Michael LeGault (Think! Why Crucial Decisions Can’t Be Made in the Blink of an Eye) illustrate this point: you need to think before you blink. You are suicidal if you don’t use every ounce of analytical rigor you have to solve your strategic problem, but you’re delusional if you think that analytical exploration is sufficient for business success. Conversely, anyone who tries to build a business on a “golden gut,” without taking the time to explore actual market data, is a fool.

Information is critical but it’s also ubiquitous. Analysis is a given. True brand differentiation and sustainable advantage can only be found and created in one place: your imagination.

Another weakness of using analysis alone is that it tends to lead you toward so-called red oceans (red because of all the competitive blood being spilled). In other words, when you are led by things you can measure, you tend toward spaces that can be measured- and those spaces are inevitably already overbuilt. Such spaces are almost always red oceans. Blue oceans, on the other hand, are not well measured, and no amount of pure analysis will lead you to them. (Read Blue Ocean Strategy by W.Chan Kim and Renee Mauborgne)

This all sounds good, maybe even a bit inspiring. But most marketers operate within large organizations and those organizations aren’t known for following the intuitive leaps of their marketers. Once you’ve made that leap you need to put your analytical hat back on and construct a bridge from the top of that information mountain to wherever you landed. Sorry, but that’s the way it works: to justify your recommended strategy, you will be asked to compare your intended path to paths taken by others- even though the only really successful path with be the one that takes a completely different route (and thus can’t be measured).

To reiterate: analyze the hell out of the situation, make your intuitive leap, and then find the analytical path that connects your landing spot back to wherever you jumped from.

Finally, if you can’t handle paradoxes you may want to stay out of marketing.

Check back in next week for more straight talk on positioning from Austin McGhie, Sterling Strategy

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Don’t Be a Prisoner

Tuesday, June 24th, 2014

prison

It’s easy to become a prisoner of your point of view.

Two very smart people from two very different worlds made this crucial point in different ways. Not surprisingly, one was Steve Jobs. In a 2005 interview with Fortune magazine about companies that were (or weren’t) on top of the move to digital music, he noted: “Some companies are prisoners of their point of view.” (Typically Jobs: small statement, big point of view. That’s just one reason he’s already missed so much.) Ted Levitt made more or less the same point in “Marketing Myopia” a renowned Harvard Business Review article published in 1960. In it, Levitt argued that corporations (and sometimes entire industries) are held prisoner by how they define their market.

Early train and bus companies, for example, defined their business in terms of trains and buses rather than transportation and thus missed out on flight. Similarly, old film studios defined their business as movies instead of entertainment and missed out on television. More recently, Barnes & Noble and Borders defined their business as mere bookstores for far too long and were “Amazoned.”

No doubt Jobs had an ulterior motive for his statement (didn’t he always?), in that he needed consumer electronics manufacturers and others to jump on the let’s-make-great-entertainment-products-that-run-off-the-iPod-brain bandwagon. But that doesn’t mean he wasn’t right.

Kids today find the idea of buying and carrying around plastic containers filled with CDs remarkably quaint. They also increasingly find the physically buying and renting of movies to be curious behavior. Music and movies will stay digital, and a very large industry is growing up around their storage, discovery, delivery and consumption. Companies that embrace this transformation will prosper, while those in denial will fail.

Blockbuster defined its business as “physically rented movies.” Despite the sheer size of the franchise at its peak, that definition still put Blockbuster on a very short runway to oblivion. On the flip side, if MGM (the casino and entertainment MGM, not the film studio) had limited itself to gambling instead of branching out into other areas of adult entertainment, it would be a much smaller and more vulnerable business than it currently is.

So be careful. The seemingly simple act of defining the business you’re in can have a profound impact on your strategy- from the business model all the way through to brand and marketing strategy. Defining your business serves to define your competitive set. Most people have a tendency to define their business, and therefore their competitive set, too tightly. They then pay the price when their business is “disrupted” by someone they didn’t even consider competition.

Spend time on this most basic question and spend that time early. Don’t wait for a crisis and never leave it to others to determine when you get around to addressing it. Bring in outsiders for the express purpose of torturing the logic of your market definition.

Finally, if you created an apparently successful strategy and you’re still around because it’s been working, task a couple of young Turks to show you why it’s all wrong. I speak from experience- it’s a case of losing objectivity through strategic ownership. Like it or not: if you’re the author of a strategy, you can also become a prisoner of it.

Define your business, and define it carefully. But consider that definition malleable and invite others to challenge it. Listen. Then create an organizational environment where people are rewarded for challenging the status quo. If someone successfully challenges your status quo before an unseen competitor does, he or she may well save the company.

Tune in for the next installment on shaping your brand strategy from Austin McGhie, head of Sterling Strategy

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The Importance of the Missionary Position

Monday, June 16th, 2014

[Although this chapter is primarily for single of master-branded companies, and less for portfolio companies such as packaged goods firms, I like to think that it has something for everyone]

True differentiation runs deep.

In some companies, the product is seen as the visible reflection of the culture- and, as customers, we sense it.

What we think of as the brand often seems more like a simple lens through which we can experience the tightly focused culture behind it. As customers, we don’t think this cultural connection through very deeply; we just kind of feel it and sense it to be true. Thus, when we sense a culture that we identify with, we also sense a brand we can identify with (and the other way around).

We sense a product or service we want to participate in, not simply buy.

Most important, when we actually do come into contact with this type of culture, the uniqueness and strength of the brand is tangible. You can breathe it; you can almost touch it.

To achieve this, you must build your brand on the inside before connecting with a culture on the outside. Great brands have a sense of mission. They live their mission; they don’t just mouth the words. When you buy the product or service, you are buying into this sense of mission. You are participating with the provider, not just buying from it. These brands have true cultural uniqueness. They have developed ways to “operationalize” this cultural uniqueness and harness it as a competitive advantage in the marketplace.

Consider this manifesto from the Burton Snowboards website:

_________

-We stand sideways.

-We sleep on floors in cramped resort hotel rooms.

-We get up early and go to sleep late.

-We’ve been mocked.

-We’ve been turned away from resorts that won’t have us.

-We are relentless.

-We dream it, we make it, we break it, we fix it.

-We create.

-We destroy.

-We wreck ourselves day in and day out and yet we stomp that one trick or find that one line that keeps us coming back.

-We progress.

_________

Think they know what they’re all about? Burton is an original. As a business and as a culture, Burton is a pure celebration of difference.

It’s easy to look at companies like Burton and think that they’re totally unlike your company- that they are an edgy, passionate business that operates in an edgy, passionate category. As a result, it’s easy to think that your category is just not that exciting. But that is cheating. It’s your job to find the drama. Find the passion and bring it! Find a way to apply it to your category and into the very heart of your company’s culture. It is your job to create and maintain a sense of mission. Granted, your job will be harder than that of your counterpart at Burton, who enjoys a supportive and focused corporate culture, but you can’t give up on it.

As an example, take a look at a software firm called SAS, which is consistently rated one of the best companies to work for in America. CEO Jim Goodnight honestly views the SAS workforce as a family. Extensive employee services, including daycare, education and recreation, are all available at SAS’s North Carolina campus. People who work at SAS appreciate the unique culture they belong to, and many talented people who don’t work there would like to. SAS’s culture and moral compass are what really drive its revenue. Low turnover and high morale also drive the company’s top line- and contribute to the bottom line as well.

The same is true of Costco. Costco treats its people well: It pays them better than others in the industry and provides them with a better benefits package. Happy employees, extremely low turnover and a dynamic growing business with a very loyal customer base- coincidence? Not on your life. A brand built from the inside out? Absolutely.

Put simply, there are no terminally dull categories or products. It’s just a question of determination and imagination- and this is the vitally important point that all marketers need to get into their heads. Sometimes the “idea” or “drama” is right in front of your eyes, and sometimes it may seem impossible to find. But you should always assume it is there. Create your brand’s mission. Build your brand and company culture around it. “Operationalize” it.

If it’s real and if it runs deep, a culture-based competitive advantage will stand the test of time. By comparison, a product- or service-based advantage, while also critical to success, will prove more transitory.

I know, I know. That’s easy to say and hard to do. But at least give it a shot.

_____________

Check back for more positioning POV from Austin McGhie, head of Sterling Strategy

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Differentiated Advantage

Wednesday, May 28th, 2014

Without a doubt, positioning your brand starts with difference- but there are many ways to be different. In fact, any idiot can be different. The trick is to be different in a way that is highly relevant to your audience. Different in a way that creates competitive advantage. Advantage that is, over time, as sustainable as possible.

All of which to say- it’s not easy.

You’re playing the game to win. To win, you need to be better than everyone else who is also playing to win. Generally, we marketers get this fact. We’re very prepared to play to win, but we’re not so prepared to be truly different. Why?

Let’s blame the system. Most of us grew up with similar names, dressed in similar clothes, went to similar schools. We ‘manage’ our differences lest our peers find us strange. We make fun of the odd ones. We fit in. This is why most of our highly differentiated brands were created by oddball entrepreneurs. They grew up different. They thought different. There were different. And therefore they created highly differentiated products and services.

But I digress.This is about advantage as much as it is about difference.

Difference + Advantage = Differentiated Advantage.

If you look at Batman, he’s different because he actually went out and built his own powers. He’s a self-made superhero. But does anyone care? Turns out that kids do, in fact, care. As a result, the Batman brand can position itself through differentiated advantage.

Apple is different because of its elegant design fusion of software and hardware. Bill Gates didn’t think people would care enough about this to overcome a superior business model. He saw it as a profound disadvantage, in fact, and he was almost completely correct- but Steve Jobs took that ‘almost’ and ran with it. More, recently, some have questioned whether, in a cloud-based content world, anyone would care about elegantly designed devices. But play with an iPad, then with a Kindle Fire- you’ll care. Apple is different. Apple is better. Apple has differentiated advantage.

It’s great that Dyson carpet cleaners (and now heaters) are different, but they are designed in a way that is both different and better. It’s nice that Virgin Airlines wanted to create a unique flying experience, but it succeeded because that experience was markedly better than that offered by traditional airlines. Hybrids were clearly a different kind of car, but until Prius designed a better kind of car, that difference was without meaning.

In the eyes of your customers, better but not different can still win the race, but it’ll be hard-fought every inch of the way. Different in a way that your customers don’t perceive as better won’t take you very far.

Difference + Advantage = Differentiated Advantage = Great Positioning

Austin McGhie is head of Sterling’s Strategy team and author of Brand is a Four Letter Word. Stay tuned over the coming weeks for more humble advice on the art of positioning.

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Eccentricity Rules

Thursday, May 8th, 2014

Differentiation or eccentricity- you can’t just paste it onto your business with the glue of marketing communication. It needs to be solidly baked into the business. It needs to be real.

Now we move on to my call for a more extreme approach to differentiation. In today’s volatile, global economy it is no longer enough to be different. You now need to be eccentric.

Many of our favorite brands are eccentric. Not surprisingly, their eccentricity often grows out of the fact that many were built by determined and equally eccentric entrepreneurs. Richard Branson of Virgin. Herb Kelleher of Southwest. Howard Schultz of Starbucks. Phil Knight of Nike. Jeff Bezos of Amazon. Charles Schwab. Sergey Brin and Larry Page of Google. Steve Jobs of Apple and Pixar. Mark Zuckerberg of Facebook. Sam Walton of Wal-Mart. Jake Burton of Burton Snowboards. Ben and Jerry.

We need to go to school on these people.

These people were (and in many cases still are) eccentric, but they’re also leaders in the best sense of the word. Perhaps they weren’t always the best managers, but let’s not confuse management with leadership. And let’s not confuse planning with vision.

Each of their businesses have more than a clear position; they also have a strong and heartfelt point of view. A point of view considered downright eccentric by some. In addition, the people who work for these leaders have a real passion for what they are creating. They have a sense of mission for which they are willing to make enormous sacrifices.

As customers, we picked up on the missions. We joined the movements and we felt a sense of ownership- and we happily urged our friends to join us.

These leaders had an elemental need to build something different. They started something different, hired like-minded people to help them, and then stuck around to ensure that what they built remained different. We also know from their biographies that each one of these leaders were told in no uncertain terms by people supposedly more expert than they that the thing they wanted to build could not be built. They listened and then they did it anyway.

“Doing it anyway” is eccentric.

Most who follow this path actually fail, but the few who succeed become famous- and very rich. Let’s face it: most of us lack the nerve and sheer willpower to be one of these people. But we can learn from them- particularly when it comes to marketing.

In many ways, things are so much harder for entrepreneurs. Using their own money and their own sweat- their passion is on the line. They are all in.

In other ways, professional marketers have the more difficult job. They don’t have the luxury of starting with a group that is committed to their vision. They must convince an entire organization to do something that no on else is doing. They have a harder case to make because truly differentiated positions, while built on logic and analysis, almost always require an intuitive leap of some kind. Once the case is made, that case has to be successful.

True differentiation is a lonely road. It’s not for the faint of heart. But it’s worth it.

Stay tuned for more on the advantages of difference from Austin McGhie