Have you ever thought about what drives your desire to buy things? Any thought given to why we brand things? Those are two questions Debbie set out to answer when she began an anthropological quest back in 2005. What got her started? A simple question about the most popular brand on the planet at the time. Check out her recent presentation at Khosla Ventures, one of Silicon Valley’s largest venture capital firms, as she describes her findings.
Posts Tagged ‘Strategy’
Competition is tough and often brutal- it’s not for the faint of heart or politically correct.
In my early days as a packaged goods marketer, I remember the annual high stakes game of writing the marketing plan. We always segmented our plan into the different elements of the marketing mix. If we were smart, we also prepared a section on the competition. The problem was that we tended to report on the competition as if it were an object fixed in time and space. An object with a brain, perhaps, but just not as smart or creative as we were. An object largely built of facts and figures rather than any real understanding and empathy.
One year I wised up. I created three teams to represent our three major competitors. Each team consisted of managers representing finance, sale, R&D, marketing and ad agencies. Each had two weeks to go to school on its designated competitor an learn all it could until it became that competitor. The final task was to outline a ten-point plan to attack our business.
We set up a two part competition: the team that compiled the most interesting and useful information won the first part; and the team that created the best ‘kill our business’ plan won the second part. We made the competition fun because annual planning is never fun.
The results were amazing- I was stunned by how much we had learned. We found out so much that I started to become concerned about legal liability.
The second phase was even more interesting. There is a huge difference between writing a page on a competitor and actually becoming that competitor in a no-holds-barred way. The 10 point plans highlighted some of our key weaknesses on the home front and were very instructive on the steps we needed to take- immediately- to ensure that they weren’t put into place by our competitors.
I believe the brands that succeed look at the marketplace in just this manner.
Here are some historical examples of fierce competition that won:
-Remember Pepsi taste tests? Pepsi’s marketers had limited success with cultured and creative campaigns, so they rolled up their sleeves and took out the brass knuckles with a blind taste test that proved consumers preferred Pepsi on pure taste. Not only did this simple approach bypass expensively produced ads, but it caught Coke completely off-guard and unable to adequately retaliate.
-I love what Budweiser advertising did a few years ago. Miller had introduced an ad campaign featuring football refs taking Bud away from people and replacing it with Miller. Bud promptly countered with ads showing police capturing the refs running away with the stolen Bud, revealing that they planned to drink it themselves. Miller eventually retreated to a less competitive plot. A trivial example, perhaps, but it shows how a dominant brand can make creative use of its power to remind the competition just who is in charge of the game.
In sum, be competitive. Be very competitive. Be like Phil Knight of Nike. Think like Yoda: “Do or Do Not. There is no Try.” The competition want to eat your lunch. Each theirs first.
Austin McGhie is head of Sterling Strategy
Immediate access to the world’s information means a bit of retraining for those of us who grew up in the one-way persuasion school of marketing. The task before us is to adjust to the much more challenging “interactive-objective” school of marketing.
Today, our claims cannot simply be louder than our competitors to win out. Our customers can easily find out how our product or service actually performs- and trust me, if it’s at all important to them, they’ll be checking. If you’ve misled them through your claims in any way, they’ll know. If you’ve mislead them, they’ll leave- and they won’t be back.
This last ‘they’re not coming back’ observation is important. Too often, marketers act as if there are only two possible outcomes to an activity on their part- it works or it doesn’t- a one or a zero. If only life were that simple and binary. The reality is that if you set up an expectation you can’t meet or, worse, you actively mislead, you may never see those customers again. No matter what you say or do, they will be lost to you forever- and even the quietest of them will take a few friends with them on their way out.
It is critical to your success to make the most of this new reality of open access to information. Use truth as a marketing tool.
A few years ago a BMW die-hard compared the official BMW website to his favorite BMW enthusiast site. At the time, the BMW site was recognized as being at the leading edge of the art. But this person’s perspective was different. He liked the corporate site, but found it too one-sided, too perfect and too sleek. By comparison, the enthusiast site was more ‘real,’ more down to earth. The contributors loved the brand, but they loved it in its entirety- warts and all. They didn’t shy away from the imperfections, but celebrated them. The net result was a much more honest, emotionally engaging and deeper conversation about the BMW brand.
There is nothing wrong with perfection, but don’t allow it to blind you to passion. Embrace the truth in your brand, allowing your customer to believe you and incite an honest passion.
Austin McGhie is head of Sterling strategy
The information on brands that is now available via the Internet brings with it a new approach to marketing. As marketers we must now actively manage noise, recognize and deal with lies, we must actively promote the truth- but ultimately, we must abandon the traditional, one-sided model of marketing known as “persuasion.” Product performance claims will be increasingly transparent to prospective customers. And once the truth is known, those customers will feel betrayed if they are lied to… and they will never return.
Whether it’s a new car or a pair of jeans, shopping is just an equation that balances degree of importance against ease of information access. Soon no one will buy a durable good without first doing a little homework. Customers will do the online research and use digital channels to tell their friends. Transparency becomes assumed, and not making this assumption invites difficulty.
Your product doesn’t perform? Your service sucks? Before you know it a quiet buzz will be felt on the Internet. This type of buzz could leak onto influential blogs and with a day- hell even within hours- a lot of hard work and good thinking will be completely undone by the very people you were counting on to build your business.
On a positive note, if you product delights the customer or your service over-delivers, you’ll quickly find the tide of information working on your behalf. This is not a new phenomenon. Word of mouth has always been the most powerful marketing mechanism, but now it’s accelerated and universal. We have more “friends” than we ever dreamed of having, and we are instantly connected to information, opinion and expertise, wherever and whenever we want.
These days, your customers are knocking on your door and you have to let them in- and they’d better like what they see. We’ve always understood outbound marketing, but the best practices of inbound marketing are still unfolding before our eyes.
Marketing is good. Persuasion is good. Brands count. But also know that the facts will matter. Those facts, as seen from several different vantage points, will be applied ruthlessly and at great speed.
Austin McGhie is head of Sterling’s strategy team
It was the worst of times; it was the worst of times… (with apologies to Charles Dickens)
Now, I’m going to bring together all of my thoughts on advertising in one place. Brace yourself.
Once upon a time, “the target” sat at home watching television, namely the big 3 networks- ABC, NBC or CBS. Wives were at home during the day, and husbands would slump into recliners at the end of their work day. You had to get up to change the channel. The audience was captive and predictable. Other media like radio, newspapers and magazines worked in support of a much less cluttered media environment.
Let’s fast-forward to the present. Traditional television is on the way out as advertising’s biggest money-maker. Most channels have no real meaning. The internet is our main line to content of all sorts to suit our desires.
These days, technology can organize content to create personal channels and it can also link that content with personally relevant advertising – or no advertising at all. In this way, the advertising that once funded the networks has become just more content, and technology now plays the organizational role formerly played by networks and advertising agencies.
More and more technological advancements are allowing customers to bypass advertising altogether- beyond pirating sites, customers will soon be able to purchase all of their content for a $1 fee and enjoy content that is ad-free. Content that comes for free increasingly provides users the choice of ads they must view- and guess what they will do? They’ll choose to be entertained or informed on the subjects they already prefer.
So we’ll have to get creative in this future world, where the old advertising market will be officially dead. The new communication agencies are filled with bright young “media” specialists who are armed with a blend of creative, technological and CRM-style skills. They are as comfortable with ROI and algorithms as they are with getting inside the psyche of their customer.
It will be fascinating to watch the Internet develop as the delivery vehicle for content, and see who ends up driving the ship: Apple, Google, Facebook, Amazon, or a brand new entity.
As always with technology, those in the middle are in for a heap of change and possibly a heap of trouble. They will have to radically redefine their roles if they are to prosper. The countdown has already begun.
Yes, everyone is already betting on the Big Four, but history also suggests that we keep our eyes on a range of companies that none of us have heard of… yet.
Just remember: the future is a very fast jet plane. Once you hear it, it’s already gone past.
Austin McGhie is Sterling’s head of Strategy
“Having lost sight of our objectives, we redoubled our efforts.“
If we don’t have the time to get it right up front, how is it that we find the time to fix it later? If there is a single message I hope to impart to you it’s this: don’t say anything, don’t do anything, until you’re convinced that you have everything right. Don’t execute a communications campaign (spending big money on ad space or time) unless you’re sure of your strategy and have perfected your tactics and tools.
Is your advertisement going to cut through the noise? If not, tell your agency the plan is on hold (as is some portion of their compensation) until it’s ready. The same goes for all areas of marketing communication. Needless to say, this approach will also add significant incentive for your communication partners to get it right.
Here’s the important part – the difficult part: Have the nerve to hold back until you feel the campaign/plan is perfect- until you have no reservations about it. There will be forces pushing for you to give the green light. Resist until you are ready.
Which seems like the more intelligent choice: To launch an acceptable campaign in May or launch a great campaign in July? It’s the difference of being invisible or getting noticed in the real world. It’s worth the wait. Try thinking of these as binary choices, between a 0 and a 1, because that’s closer to the reality of market impact than any incrementalist model.
Real marketing communication always does better when it moves from blunt instrument to scalpel. Blunt instruments need too much force behind them to work, whereas a scalpel just needs a perfect cutting edge. Start sharpening, and don’t cut until you find that edge.
Stay tuned for more from Austin McGhie, head of Sterling Strategy, on aligning your strategy with creative execution.
Here’s the thing about strategy. The people who matter, your customers, never see it.
Real people experience your product or service- the see, feel and touch your tactics- but they never, ever see your strategy. The corollary of this observation is that it can only be great strategy if it makes for great tactics. This one’s worth repeating:
It’s only great strategy if it makes for great tactics.
When I worked in the ad business, every now and then I’d hear people both inside and outside the agency say something along the lines of “Yeah, I know the strategy’s a bit flat, but the creative team will bring it to life.” That is dangerously lazy and wrong thinking.
Great positioning strategies are creative in their own right. When the strategy is great, it ends up being something fun and easy to communicate just as an idea. You will know that idea will provoke, maybe even disrupt. That idea will demand a response from the target audience- even when it’s still a raw idea, before it becomes a beautifully finished piece of communication. When you have a great strategy, you can already see the advertising, events and promotions falling into place.
When someone in a long-ago meeting suggested positioning 7-Up as “The Uncola,” everyone there knew that a breakthrough had been made, and that powerful communication programs would be an inevitable outcome. Similarly, Sterling Brands helped the Dove brand team create the “Real Beauty” strategy that has guided their brand so effectively, and Ogilvy & Mather (and others) created the communications programs that made it count.
Great positions are themselves marketable ideas. If you can’t immediately see the path from a positioning strategy to its tactics, you’ve probably got some work left to do on the strategy itself.
Creativity has greater dollar value in the marketplace today than ever before. The creativity that later lends itself to effective tactics, to the amplified effects of people sharing your ads around the Internet, to an event or experience that feels ‘just right’ to your target audience- all begins in your positioning. And in an Internet-based global economy, creativity has become the competitive differentiator.
For brands this means that you should seek out partners and people who are truly creative, but also smart enough to get strategy. They are few and far in between, so treat them well. They are the few who will make a difference in this new marketplace – and that difference is only going to get bigger.
Austin McGhie is head of Sterling Strategy
In the words of Rutherford Rogers of Yale:Â “We’re drowning in information and starving for knowledge.”
Most marketers don’t need more research or more data. They need more insight.
That may seem a small point, or even an obvious one, but I remain astonished by the high ratio of money spent on research that doesn’t lead to action compared to money spent on research that does lead to action.
Information is useless in its own right, and far too many people and organizations are satisfied with spending millions of dollars on useless information. Yes, you need to know what’s going on out there- but only if you are actually going to do something with the knowledge. Only if that information somehow yields competitive advantage.
The missing ingredient can sound trite. Insight is a much-overused term in the world of marketing. But it’s insight that you’re looking for. It’s insight that’s worth paying for- not information.
So try this: review every “research” expenditure you have. Ask the same two questions of each program or project:
-Will it lead to an action?
-Will it lead to insights that will yield competitive advantage?
If the answer is no to both questions, don’t do it. Save the money and- perhaps more important- save the organizational time and focus that can be much better spent on insight generation.
Many companies seem to be so busy processing information that they lose track of its purpose. What if all that processing time and the minds that like to do that type of processing were replaced with insight-generation time and minds that like to create insight? It’s time to find out.
Austin McGhie is head of Sterling’s Strategy team
For what it’s worth, the term ‘consumer’ really irritates me. I still use it to make myself understood, but it bugs me. With time, I’ve concluded that the word bugs me for strategic reasons- not just because I don’t like the word itself.
‘Consumer’ conjures up a mass of people ready to blindly ‘consume’ my product. By comparison, the word ‘customer’ seems more singular and implies a relationship of some kind. Consumers consume. Customers purchase- if they are treated right. Consumers are the way of the past. Customers are the wave of the future.
This makes a difference on a couple of fronts. Right now, retailers have customers and most of their suppliers have consumers. For structural reasons, but also because of this schizoid mindset, the retailer often has a much stronger relationship with that person than does the manufacturer. Over time, this almost always leads the retailer to become a more trusted ‘guarantor’ of product quality than the manufacturer. Ultimately, this means that the retailer can source products and build brands that the customer trusts more than those from the manufacturer- and they’ll be cheaper for many of the same structural reasons.
I believe everyone needs to build a real, working customer relationship management (CRM) strategy. Forget the software for now; just embrace the theory. In the old world, terms like 1:1 marketing, segmentation and mass marketing were too often viewed as distinct alternatives. The fact is, for many marketers, inside their customer database reside customers who deserve to be handled 1:1 and can be profitably marketed to this way, customers who can be approached on a segment basis, and customers who can only be profitable if they’re treated en masse.
Depending on your business, you may even be able to determine the unprofitable customer- and although all consumers may seem like they are worth having, some are definitely best sent over to your competition.
So, let’s stop thinking about the people buying our products and services as consumers and promote them to the exalted status of customer… and then we can all go back to fighting over them.
If you’re a manufacturer and this creates confusion with intermediates such as retailers, who you currently call customers, I have another suggestion. Call them partners and treat them accordingly.
Austin McGhie is head of Sterling Strategy. Stay tuned for a continued, in-depth take on the customer all month long.
“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’ Â 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.