Posts Tagged ‘consumer marketing’
I focus a lot of client attention on Baby Boomers, because they have the disposible income today, and are still freer spenders than the generations that are succeeding them. If you have a need to make money today, you must focus on those people who have it.
Millennials do not yet have gobs of money to spend, so all the attention paid to them as “the coming thing” is still a bet on the future.
However, it pays to understand the radical differences between generations if you have a product or service that all of them could buy.
So this article by Samantha Sharf on Forbes.com is a useful read, because it nails down what may be an enduring characteristic of Generation Y that anyone selling product over the next decade should keep top-of-mind:
Millennials have been tempered by the Great Recession, and may very well keep that sense of economic “fear” with them all their lives. Whereas Baby Boomers are inveterately optimisitic about the future because their formative years were free of significant economic malaises (Mid-70′s oil shocks being the only significant events), Millennials share with the Greatest Generation the idea that our economic house of cards cannot be entirely trusted.
Millennials are giving indications that they are going to be better savers of money than Baby Boomers, and a bit more risk-averse than Generation X.
This generation will remain less loyal to brands than older generations (partly because there is so much more choice, and information about those choices, instantly available to them through their web of connectivity.)
They will retain a need to have their lives and work tied to a meaningful cause. Intrinsic value of the work being done will matter more to them. Caveat here: Baby Boomers started out with this mindset, too, and it faded as the need to make money and raise families became paramount. So this need for meaninfulness could weaken with Millennials as well.
Ms. Sharf’s article is focused on how to make financial advisory services relevant and accessible to Millennials, who will have wealth to invest sooner in their lives than Baby Boomers did. How can your product or service relate to these emerging Millennial consumer characteristics?
- How does your value proposition help save the world? By this I don’t mean you have to cure cancer of resolve international conflicts, but do you work to save resources, keep carbon out of the air, be a good steward of your environment? Emphasize how you do that in your outreach.
- How practical are you? Why should your brand stay on their radar? What need do you solve for them that proves your worth? Spend less time simply establishing your brand, and relatively more on proving its worth with stories from your actual marketplace.
- How can you help them achieve their balance of social good and personal security? If they are less grandly aspirational than preceeding generations, reflect than sense of future ansgt in your messaging.
Because of their enforced tempering by the Great Recession, Millennials are indeed going to act much more like their grandparents than their parents in the marketplace. This is a characteristic that we all need to track closely as they fully mature into a consumer group with their own resources over the next decade.
I spent this Saturday walking through the gritty details of how to blog better, with a man who has made a career of it: Bill Belew. Much as psychiatrists keep themselves in therapy to stay sharp, so a blogger like me needs to reconnect to the top blogging artisans to keep my small business marketing skills sharp.
What did I learn?
- Stop writing novels for posts. Short, to the point, intriguing content, consistently delivered, attracts the site traffic (classic SEO practices)
- Write more often. This goes hand-in-hand with “stop writing novels.” If I write more concisely, I will have more time for other posts, driving up quantity. Quality is important, but quantity is KING.
- Link every post externally and internally. Do not be afraid to link to “fellow competitiors!” Connect yourself to bigger influencers in your specialty. Use technorati.com to find these thought leaders and raise your own authority.
Bill went through over 20 key elements of a great blog post, but these are the key steps that I need to practice and internalize to make my own efforts (and efforts done for my clients) more effective.
I can’t wait to get started implementing these ideas in my own blogging. I am re-energized!
Look for more insights from this workshop over the next week or so. And let me know if one of these insights clicks on a light bulb for you.
Image credit: www.billbelew.com
Kodak has taken itself into bankruptcy, which highlights how this mighty brand has fallen from “iconic” and “powerful” to “weak” and “past it.” This is a classic tale of a successful, profitable company overwhelmed by the need to reinvent itself, and failing to take action fast enough to maintain its market position. Kodak as a poster child for a company that denied the truth, continued to “believe it own press releases” about its invincibility, and paid for it.
The Great Irony: Kodak invented the technology that destroyed it.
A Kodak engineer invented digital imaging in 1975. And unlike cases like Xerox failing to see the value of what it invented (see: the computer mouse), Kodak continued to set the pace technologically in digital imaging for decades. Yet the commercial successes accrued to the camera makers at Canon, Olympus and others, not Kodak. Why? Because they never truly changed their corporate mindset that Kodak was in the film business.
Kodak always had the technological capability to compete. Not only did they invent digital imaging, they were the first to stuff a high-resolution chip into a handheld camera, and were the first to get the price of a digital camera under $1,000. Here’s a great example: Astrophotography camera companies like SBIG makes cameras that are considered the top-quality choice for imaging distant heavenly objects by amateur astronomers. SBIG cameras rely on a Kodak imaging chip!
Somehow these technical accomplishments have not been leveraged to reposition the brand in the marketplace. Why? Blame poor marketing driven by the erroneous belief that the Kodak brand meant more than quality photo film to consumers.
What should they have done? Their best move would have been a shift in brand positioning: Redefine themselves as being in the imaging business rather than the film business, and put all their marketing resources to work to make sure consumers knew it. That clear change in positioning would have allowed them to retain their film business as long as it made sense, while simultaneously leading the move into digital. Ultimately they did try to expand what Kodak meant to consumers, but did it at the product level rather than the top brand level. Witness this list of product introductions since the mid-70s:
1975: Introduces plain-paper copiers
1976: Invents digital photography
1976: Introduces instant cameras
1984: Introduces videocassette recorder and cameras
1985: Starts selling floppy disks (a storage medium for images)
1986: Develops 1.4 megapixel digital sensor small enough for handheld cameras
None of these became a big commercial success. The idea that the Kodak brand was broad enough to ensure the success of Kodak-branded products like these tells me that they never truly understood how limited their brand was in the consumers’ minds.
In an e-mail just this week from i4cp, I found the following passage:
“We know from experience that sustained high performance is synonymous with, among other things, being ready for change – and having a degree of insight into what’s around the corner doesn’t hurt.”
That “degree of insight” was lacking at the top of the Kodak managment heirarchy. They were, in effect, in denial about the true strength of their brand.
The Truth: Digital was a Killer App
It is incredibly hard for an organization that is highly profitable to make dramatic changes. For Kodak, entire supply chains of chemicals, plastics and paper stood at the front end, and retail distribution at the back end. Add to that after-market film developing services, and you have a huge marketplace structured around the business of selling film. Actively taking steps to threaten such a profitable venture would have taken guts that most top managers don’t have in a publically traded company. Management cannot simply say “OK, now we are a digital imaging company” unless they drag the whole company with them. Only a strong leader with a real grasp of the truth about future prospects can pull it off.
It can be done, however. IBM has done it more than once. Xerox (ironically for Kodak) made the shift from copier company to imaging company, then on from there to “managed document services.” Apple has risen from the dead twice.
Kodak could have, too. The truth was that digital was eventually going to kill the film business, and Kodak management needed to internalize that reality and reinvent the company as the leading imaging company, grabbing the technology lead from their pals in the camera business. No one trusted this hard truth as the right path forward, and this led to poor strategic decisions that led to the sinking of one of the world’s strongest international brand into bankruptcy. Had Kodak bit the bullet and made digital technology leadership a central marketing tenet, I believe they would have retained a leadership position in the “Imaging Market” even while the film business faded away.
What truths are you denying in your industry? What external threats are you discounting because they don’t fit into your definition of your marketplace, or would upset your carefully crafted business plans? What are you in denial about???
If you want to find out, give me a call. We can explore your current brand mindsets and see where they do or don’t connect to consumers. What one of my clients calls “The Pursuit of Truth” mindset is the best defense against becoming the next “Kodak.”
I recently completed a writing assignment for a good client, Bovo-Tighe. Dave Tighe and I worked over a number of weeks to put in print a core piece of his Foundations of Excellence employee development philosophy.
Here is the article link: Pursuit of Truth
His message has a strong connection to all businesses and their marketing efforts, including smaller ones, so I am sharing it here.
In short, You must know as much as possible about everything that affects your business. Examples:
- You cannot assume customers want what you propose to sell.
- Nor can you assume they are happy with the solutions you have provided.
- Plus, you cannot assume that your employees are efficient and always customer-focused.
Now replace “assume” in the above sentences with “hope”. Hope cannot be a business strategy, yet too many people adopt scattershot marketing initiatives and hope that they work. No forethought, testing, tracking, tweaking mid-stream. Just take a vendor’s advice and toss money or time at it (and skimp on the time needed, too!)
To quote from the article, a London-based professor of business named Donald Sull wrote:
“Managers and entrepreneurs walk past lucrative opportunities all the time, and later kick themselves when someone else exploits the strategy they overlooked. Why does this happen? It’s often because of the natural human tendency known to psychologists as confirmation bias: People tend to notice data that confirms their existing attitudes and beliefs, and ignore or discredit information that challenges them.”
As business owners and managers, we must challenge ourselves to accept that:
- We cannot already possible know everything that is going to affect our business over the next 12 months. If we want to “hope for the best” we must still “plan for the worst”, and try to understand what that “best” and “worst” could be.
- We must be wide open to bad news, and adopt a mindset that every bit of news (good or bad) is an opportunity to act in a positive way to achieve our desired outcomes.(To borrow another Bovo-Tighe training regime: E+R=O, which is “Event + Your Response = Outcome.” You cannot control events. You CAN control your response, and therefore the outcomes from the event.)
- We must seek out and reward those people who provide unvarnished truths, especially our employees who interact with customers most often. Teach them to share bad news just as they do good, and give them an “atta boy or girl” when they do.
- We must train our entire organization to have the same “Pursuit of Truth” mindset, especially with regard to customer prospecting and servicing.
The Pursuit of Truth is not just getting rid of hidden agendas and blame-games. It is instilling a relentless desire to know what is really going on both in the workplace and in the marketplace. As we said in the article:
“Cementing this ‘pursuit of truth’ mindset into the corporate culture means that problems and opportunities are willingly shared sideways and upwards, and not left buried to fester, or worse, be discovered and exposed by customers. Companies that pursue truth in every interaction respond better to customer issues, and seek to solve them, learn from them, and share that learning across silos and over cube walls.”
Article Source: http://EzineArticles.com/6726458
The old politician Tip O’Neill famously opined that “all politics is local.” That is, the day-to-day issues of each voter drive his or her choice of candidate or political party.
Even in the age of internet shopping, “local” is still King with consumers, too. And here is the evidence: Big companies still try to interact with their customers and prospects locally to maximize the chance they will choose their brand. As noted in this article:
“Localization of messages, images, creative executions, offers, deals, and interactions is still critical to marketing effectiveness and customer relationship building across many business categories.”
Here are some highlights:
- 49% of marketers believe localized marketing is essential to business growth and profitability, particularly as it relates to demand generation and sell-through of products and services
- 30% of marketers have embraced local marketing automation platforms, resources and tools, compared to 62% who either don’t have them or only now evaluating these options
- 23% of marketing respondents allocate over 50% of their marketing and merchandising budgets to local programs; another 41% spend between 20 and 50% of the budgets on local marketing
- Cable and broadcast television, local magazines, and radio reportedly deliver the lowest return on spend, compared to top performers like local events, direct mail or FSIs, local partner or channel web sites, social networks and electronic messaging.
In other words, local small business people, the BIG Boys are horning into your turf. Are you fighting to retain your share of local consumer spending? How are you reminding the people in your target market that you are there, and have all the same stuff the Big Boys of Marketing do? Look at that last bullet point. It is a nice summary of all the places you can profitably position your own business against the big budgets of national brands. There is your level playing field!
- Monthly e-mails that have valuable offers for your regular customers?
- Prospecting in local coupon mailers (still effective) and online coupon marketing services (usually profitable if structured correctly)?
- Active on all local shopping and review sites (and tracking which ones actually bring leads)?
- Investigating local mobile marketing, and adding those mobile numbers (opted-in!!!) to your database? Especially those of you who cater to younger generations?
- How is your library of video clips coming along? Do you have a YouTube channel for your business yet?
- If you are getting uncomfortable reading this, you need to take action!
- Remember, you don’t have to do everything in the marketing toolbox. You just need to find those four or five tools that best work for you, and put the time and money in to make them work hard for you.
The year 2012 is upon us. It is going to be a year of reawakening consumers and reviving buying behavior (a trend started this year already). We are not getting back to the glory years of the mid-2000s, but better times are on the horizon, and you need to have plans laid in to get your fair share of all business done locally.
We still have two months to go in this business year, yet we already have two candidates for brand disasters that will be hard to top.
First up, Netflix and the repricing/rebranding two-step stumble that occurred this Summer and Fall. What a mess! It is understandable that the company needed to rework its pricing to better match its business model, but it hard to believe the company did sufficient homework (customer research, that is) before making a big pricing increase from around $10 for the combo home delivery/streaming film service to $16. I saw poor marketing planning, too, almost as if Marketing had little say in the decision, and was handed a fait accomplis and a tight timetable:
- Where was the looooong telegraphing of the move before it took effect (let’s say at least six months) that would have given customers the chance to adjust to the news? (Full disclosure: My household is a customer.)
- Where was the justification for the shift, fully explained to us, the customers? Not the media, mind you, but directly to the customers? We customers received a letter after the whole thing blew up in Netflix’ face, but not before (at least not my house.)
- How about giving loyal customers an inside benefit by allowing them to keep the old price for a period of time (two months, say, for each year of being a customer.) That would have made the transition less painful. As it is, my family quickly canceled the home delivery and kept only the streaming service. We might have stuck with both for a loyalty discount.
And where Quikster came from is a real mystery. NetFlix is still a very strong brand, yet the old business that built the brand was being dropped down to a secondary brand like last year’s fashion designs. A needless and expensive solution for a customer service and communication problem, that was clearly not thought out. It may even have been the brainchild of one man (the CEO) in a desperate attempt to contain the damage from the pricing fiasco.
This led to a consumer revolt, and the whole mess has led to close to 1 million customers going out the door. Ouch.
Close on the heels of Netflix comes Bank of America with their debit card fee, announced at $5 per month for any month their debit card is used at a merchant point-of-sale (not at ATMs).
This was a financial decision, taken in response to the limits placed on debit card transaction fees by the Dodd-Frank financial industry regulation package. BofA stands to lose millions in foregone transaction fees (as will all other debit card issuers.) So, they decided to keep debit cards profitable by imposing a new fee for using them. Their biggest mistakes? Same as Netflix:
- Poor telegraphing of the move. Their competitors announced “tests” of the concept, and quickly drew in their horns when the “tests” produced poor customer reactions (a significant drop in POS debit card usage.) See a good summary here. Unlike airlines in the days of old, an announced round of price rises did not signal to competitors that it was OK to announce their own matching increase.
- Poor choice of price: $5 monthly is a huge fee. Why not $1? That might have been a bearable load for most consumers, and still have made up a bunch of revenue.
- Poor understanding of market sentiment. Consumers are very aware of prices and fees for service today, so this bald announcement generated an entirely predictable marketplace response.
These two companies did not do their homework, did not soften the blow with any nods to customer loyalty or possible competitive responses. They just bulled in the china shop and started knocking stuff over.
Perhaps they didn’t think so, but it sure came across that way to consumers! Whenever you face a need to raise prices (as all businesses should at some point), you need to actively structure it as a chance to reward good customers by “sharing” the needed price increase with them.
The biggest marketing issue that drives companies to pick up the phone and call me for help is the multiplying number of marketing tools available, and the “apps” within those tools that lots of online marketing writers go nuts about.
I got to thinking about this when the good folks at McKinsey and Company sent along a link to a new online resource that may be worth registering for if you want to stay on top of the latest thinking within the Marketing profession.
Even with all the lip service given over the last decade to focusing “like a laser” on fostering customer loyalty, consumer packaged goods marketing managers still struggle to generate good outcomes against that goal, for some very basic reasons.
CPG managers are told by the entire marketing industry to get serious about engagement and foster loyalty. The very day I sat down to write this I received a fresh example of this from Aberdeen Research:
“In order to truly offer a positive shopping experience, retailers must get insight into the mindshare of their customers and prospective customers. The shopping experience today goes far beyond simply walking into a store and selecting a product. Customer experience management begins with the use of customer intelligence and insights as a means for enhanced customer engagement. Engaging customers at all points in the shopping journey to better service, provide information, and ease of purchasing, is the key to customer-centricity.”
That said, here is some evidence that whatever CPG managers are trying, customer loyalty for CPG products is proving tough to hang on to.
Marketing “tenets” hold that keeping a customer is 6-10 times cheaper than finding a new one, but that might not be the case when it comes to CPGs. Boiling the challenge down to the essence: The company is not standing in the aisle with the customer at the moment of decision, when the packaging and pricing of their product is just one of a number of competitors on the shelf. Even with a coupon in hand designed to block out the competitive options, the consumer may check pricing, see specials and decide to try something else.
Plus, the CPG manager hardly ever learns who that customer is, and so cannot reach out to him or her on a personalized basis. At what point can the company ask for an opted-in e-mail address? They can promote their social media communities on their packaging, and in their mass marketing, but only a small percentage of the total customers they need will raise their electronic hands and connect.
As a result, it is still far easier for a CPG marketing manager to work on big demand-building projects that involve mass media, direct mail and other such tools than it is to forge connections with each individual buyer of their product. Social media and other community building are a growing part of the mix, but are not yet game-changing, move-the-profit-needle initiatives.
What to do? I wish I had a magic wand on this one, because the answer is “keep at it:”
- Create active online communities
- Explore e-commerce options that could lock-in customers and keep them out of the retail aisle
- Advertise all your community options on your packaging
- Make those communities about the customer in interesting and inspiring ways
- Keep building demand through mass media (targeting to a preferred profile, of course!)
- Get better at working with retailers and gaining access to all their scanned data to improve your profiling
Loyalty is a tougher nut to crack for product peddlers who are not present when consumers make up their minds, but consumers are willing to listen, and the consistent quality of product does make an impression once trial (or re-trial) is induced.
The media naturally takes an event and makes the most of it, and like to glam it up with dire (in Apple’s case) predictions about what the event means for the future. Industry pundits (and bloggers like me) must follow up all that breathless coverage by finding a fresh angle of any kind to veer along to get attention.
So, here’s mine: We are overreacting to the news that Steve Jobs is stepping down as CEO of Apple. People are drawing parallels to the disasters that overtook Apple when Mr. Jobs left the first time, which is understandable (“Will history – gasp – repeat itself? Should we sell Apple stock right now?“)
Here is a typical quote:
“The creativity and business moxie of Steve Jobs is, in my opinion, irreplaceable, simply irreplaceable,” said David Schamens, a portfolio manager with Invictus Funds. “Longer term, the company is going to be searching for talent that is on his creative level.” (from an article in the San Jose Mercury News.)
It is a mistake, however, to draw the parallel to his previous departure, for a couple of reasons:
- The first time Jobs left, he was forced out. His imperial, suffer-no-fools approach to management pissed too many people off. The Lisa computer had been a major flop, and the company was already struggling to recapture genies in their bottles.
- This time, Jobs leaves on his own terms, quite amicably, with staffers wringing their hands in the halls as he leaves.
- He has been “gone” for months, so this event is really just a culmination of a long transition of Jobs out of day-to-day management.
- He isn’t really leaving. He remains as Chairman of the Board. So his influence remains within the organization.
I like this article (aside from the somewhat misleading headline, another issue with online journalism today…), which takes a reasoned view, and expects the company to continue on as they have over the last decade.
The consumer friendly/design-focused Apple of today will survive this departure in much better shape than the Apple of the 1980′s, which wilfully turned its back on Steve Job’s vision.
Fool me once, shame on you. Fool me twice…
Apple is not run by fools this time around. The brand looks in good shape from this vantage point.
I am pleased to be able to share here my latest column on Forbes.com, which takes a look at the perils involved with distributing coupons for your business through online coupon services, which are exploding in use in the wake of Groupon’s “success” (in quotes because the business model is still not generating bottom line profits.)
There is great value there, if you do it right. Click through to the column for some thoughts about how to calculate the financially the results you would need, and some steps to take to ensure greater success.
And let me know what you think in the comments section!