Alan See

A recent article in the Wall Street Journal (Recovery Losses Momentum) stated that consumers have seen little growth in their wallets and remain skittish about the economy’s prospects.  Of course, if you own a business that depends on people having jobs and disposable income you didn’t need research from the U.S. Commerce Department to tell you that consumer spending is sluggish.  Economists are currently cutting forecasts for the second half, and your calls and foot traffic are already down.  So, what’s your plan?  Take more costs out of the business?  My guess is that you’ve already cut expenses to the bone.  But hold the presses! Do you really need a marketing recovery plan?  After all, Business Week reported (The New Abnormal) that while Americans are broke and depressed they are still swilling $3 lattes and waiting in line for iPhones.  Are you from Apple or Starbucks?  I’m not either; so here are some quick tips to consider in our “unusually uncertain” economy.

1. Focus on the consumer.
a. Translation: Make sure you address competitive weaknesses within the four stages of the consumer purchasing process lifecycle, including: Awareness, Information Search, Evaluation, and Purchase / After-Sale Service.  In addition, you may need to think smaller by breaking large marketing initiatives into several highly targeted micro campaigns based on continuous selection of the best (most profitable) of the best (ready-to-buy).

2. You will not get a do-over, mulligan or practice shot.
a. Translation: Do your P&L homework upfront and structure your best offer immediately. Don’t hold back; consumers with cash and a willingness to spend it are in short supply right now.

3. Don’t wait until there is a problem to contact or follow up with customers.
a. Translation: Monitor trigger events (contract dates, service calls, etc) closely and nurture two-way relationship building conversations. For example, my cell phone contract expired back in February and I still have not been contacted.  When you do follow up make sure you have something valuable or significant to relate.  By the way, a call merely to say you “just wanted to touch base” is not value-add.

4. Keep asking, listening, analyzing and improving.
a. Translation: Keep asking for and listening to your customer’s feedback.  And make sure you are leveraging and engaging your entire organization as it relates to that feedback.  Social media platforms are an excellent channel to help you both listen and engage in conversation.

Remember playing “Rock, Paper, Scissors?” The basics of the game consist of each player shaking a fist a number of times (priming) and then extending the same hand in a fist (rock), out flat (paper), or with the index and middle fingers extended (scissors).  Each of these is referred to as a throw, and which one wins is dependent upon the opponent’s throw.

·         Paper wins against Rock (paper covers rock)

·         Rock wins against Scissors (rock smashing scissors)

·         Scissors wins against Paper (scissors cut paper)

Under close examination many organizations may find they are using a rock, paper, scissors customer experience strategy. You know - prime the market with new product features, throw out interruption based communications hoping to rock your prospects with repeat broadcast ads, cover your defects with stopgap fixes, and then cut your development time so you can do it again - only faster.

Your new product features might be on target, and your ad spend capable of rocking the market; however, your customers may still cut-out your business faster than you can scream “don’t run with scissors” if poor quality impacts their experience.  Research shows that your reputation for quality affects sales in three ways.  It will:

1.      Reinforce the confidence of previous customers.

2.      Win new customers.

3.      Induce customers of competing brands to switch.

The cost of quality may seem high, but the cost of poor quality is still higher.  If you take steps to protect your reputation for quality you will be sure to win no matter what your competition is throwing.

In November 2009 Twitter launched an interesting feature called Twitter Lists.  In short, Twitter Lists allow you to organize the profiles you’re following into groups.  The filtering aspect of this feature is helpful if you are trying to zero in on something specific, such as Twitter users based on location, employer, or any other relevant categories.

Creating a new Twitter List is a simple process.  In fact, the first thing you’ll be asked is to provide a name for your list.  That’s where this feature can take an interesting turn.  If you’ve been Listed you’ve caught someone’s attention.  Something in your bio and / or tweets has made an impression.  In the future, your Listor will be able to find you quickly because they filed your profile under a group they intend to monitor.  In other words, your reputation or influence has been noted.  A few examples:

·         @GfKMRINews/marketers Masters of marketing

·         marketingveep/c-level-tweeps All flavors of C-level executives who’ve figured out the magic of Twitter

·         @PaulaGray/brand-product-mktg-mgt Ears to the ground in product, brand and marketing management

·         @MikeMoore_/education Speakers, Authors, Teachers, Trainers and Spiritual Leaders

·         @RicGator/unclassified Don’t know where to list at this time

OK … being classified as “unclassified” is a bit confusing, but overall the Listed feature is a quick way to monitor your branding strategy.  Have you checked lately to see how many times you’ve been Listed?  How did they categorize you?  Does the name fit with your strategy?

I’m fortunate to be able to reflect on the role of marketing as both a CMO and educator. In my role as educator my student’s first assignment is always a short interpretive paper in which I ask for their personal definition of marketing; as well as their perspective on marketing’s importance in helping organizations achieve success. Over the years, I’ve discovered that these papers provide a glimpse into the mindset of individuals who are generally not focused on core marketing activities or marketing’s role in relation to broader business strategies.
Demographically, the class typically represents a diverse cross-section. One thing they do have in common; they are full-time working adults who are not shy when sharing their real-world working experiences with the class. More often than not, their original narratives will jump into examples of product-focused mass advertising or publicity activities. The use of sexy and manipulative promotional tactics for selling the audience on why they should want the product is representative of marketing’s tactical purpose in their initial points of view. In fact, for classes that start in January you can bet on at least one reference to a Super Bowl commercial. However; I can tell straight away who is reading ahead in the syllabus, or working for a company that views marketing strategically because those efforts reflect the leadership role that marketing plays as a core business strategy.

An Effective Marketing Strategy

An effective marketing strategy involves a process of narrowing down to a specific target market and marketing mix that represents an opportunity the company wants to compete for based on their business’s mission and vision. Because most company’s resources are limited, and there are usually multiple strategies possible, the ability to consistently zero in on the best market with the best marketing mix will delight both management and the market. Does the previous statement sound familiar? If not, maybe you’ll recognize it in the form of the “right…” phrase that is often found in whitepapers. It’s worded as follows; companies that first focus on the customer’s needs, and then satisfy those needs by delivering “the right product through the right channel at the right price at the right time” will build customer loyalty and maximize shareholder value.
Imagine that an organization fully understands the needs and desires of its target market, and that the marketing mix is combined in a way that fully supports the overall business strategy. In other words, manufacturing, product management, product marketing, advertising & public relations, sales, service, finance and logistics have all pull together to provide perfect alignment. Was that hard to imagine? The perspective painted by my student’s suggests that most organizations are still highly matrixed environments, and that suggests overall business strategies are loosely knit at best. Don’t get me wrong, matrixes are not going to go away. Particularly in large organizations where you need specialists because the scope of the whole marketing job is just too big for one person. Yet, the fact remains that alignment breakdowns between these functional areas continues to put business strategies at risk.

A Written Marketing Plan

How can marketing take a leadership position to help reduce risk and ensure strategic alignment? How about another dashboard or scorecard? After all, a relationship with customers is what capitalism is built on, and the great thing about capitalism is that it keeps score. In fact, at this point technology vendors might be tempted to insert the need for a heavy dose of their specific applications to better manage reporting or improve the ability to target customers and predict their behavior. I can’t argue that specific technology might not help any given situation; however, technology alone won’t turn the product-focused dotted-line matrix challenge into a solid-line customer-focused marketing plan.
A simple but often overlooked discipline to ensure that marketing is facilitating strategic alignment and that the marketing mix is focused on the desired customer experience is to use a written marketing plan for each marketing strategy developed. There is value to organizing, documenting and writing down a marketing plan. The very process of bringing functional areas together to ask and answer the questions posed in a comprehensive marketing plan will create a road map to guide your total marketing efforts, and help bring strategic alignment.
My student’s final assignment is a team-based project that involves the design, documentation and presentation of a complete marketing plan based on the launch of a new product. The presentations always generate lively class discussion as each team talks about their target market and the marketing mix that will be crafted to satisfy the researched needs. Although it takes me several days to grade, it’s encouraging to read their new and expanded perspectives, and I can assure you that the strategic transformation of the marketing function as brought to life in their documented plan would warm any CMO’s heart.

I recently attended a faculty meeting to kick-off the New Year. One of the presentations disclosed enrollment trends that did not surprise, but none the less disappointed some of my fellow faculty. An increasing number of students are enrolling in online as opposed to on-campus courses. In short, the online modality more closely matches many students desired method for consuming education. Although most of the faculty can teach both online and on-campus, their traditional teaching backgrounds creates a comfort level and natural desire to interact with their students in a class room environment. The shift from a class room setting to online just doesn’t feel right to some, and that can make it difficult to embrace change even when the data states the obvious.

Shifting business environments make change necessary, but it doesn’t mean it will be easy. In my role as VP of Marketing there are always struggles to keep new initiatives on track even when the data indicates that the change is not optional. Strong feelings to revert back to the old status quo are often lurking just below the surface. For example, a shift in our media planning recommendations away from traditional media products and into earned media programs at times creates fear, uncertainty and doubt within parts of our organization. You can just imagine the questions swirling:

·         What will our traditional customers think if we’re recommending media they’ve never tried before?

·         How will our competition, not to mention our media partners, react to our strategy changes?

·         How do we know for sure that these new media channels will deliver results?

Change has no conscience. It doesn’t play favorites, or take prisoners. In fact change ruthlessly destroys organizations that don’t adapt. So, from a leadership perspective here are three traits I intend to embrace this year:

1.       Take the initiative by putting my team in charge of problem-solving. If I make them (or let them) wait for hand-feed directions I’ll slow down the process.

2.       Take more risks and be willing to break with the past. I’ll ask my team to mitigate risk when possible; but make no mistake … both my team and I will need more nerve in 2010 in order to keep our new initiatives on track.

3.       Maintain faith in the new initiatives. As soon as change starts throwing off sparks, people become preoccupied with all the headaches, aggravations, and fears. I know there will be dark days; however, I’ll challenge my team to join me helping our entire organization look beyond the bleakness of the moment, and envision the possibilities of tomorrow.

I’m really looking forward to 2010’s opportunities and challenges. How about you?

The September 2009 issue of Inc. magazine showcases the 500 fastest-growing private companies. Forty-eight advertising and marketing companies are listed and a recurring theme among those organizations is a performance-based business model. In other words, the client only pays when customers take action. Pay-for-Call, Cost-per-Action, Pay-per-Sale, Revenue-Sharing, Profit-Sharing; make no mistake, performance-based business models contain elements of risk, and are taking center-stage in our current economy.

Well, “taking center-stage” may be overstated as the need to measure marketing performance has been a hot topic for several years now. Case studies that document marketing-return-on-investment (MROI) and articles covering the short tenure of marketing leaders who do not quickly deliver measurable results are numerous. So what’s different about the current trend? Traditionally, one might view the agency business model as low risk-low reward. This means that the advertiser pays 100% for all goods and services and then owns 100% of the resulting efforts. However, I’m sure there are several agencies who would argue that they have always been held accountable for measurable results no matter how the business model is defined. I’m also sure there are advertisers who would counter with agency invoices that they felt did not reflect a low reward trade-off.

All forms of advertising pose some risk, and no agency can afford to work for free - so we can’t hope to eliminate risk or reward in advertising. However, advertisers and agencies can negotiate with one another to find business models that represent acceptable levels of risk and reward for both parties. Performance based advertising isn’t for everyone and it’s not right for every situation; but given the current economic climate it’s worth exploring.

Are you friending, linking, tweeting and blogging? Social media is driving a wave of human interaction around the world. In fact, I find myself approaching the triple 3K mark on twitter; 3,000 tweets, 3,000 followers and 3,000 connections. Those are fairly low numbers when compared to many avid twitter users; although high enough to rank in the top one percent of users, at least according to Twitter Grader . But what does it all mean? Do social media sites encourage people to concentrate on their number of connections rather than build actual relationships? Is social media best used by individuals; or will it really change the way organizations engage their customers? And what about the ROI; is the return on relationships something that can (or should) be measured?

Some marketer’s are still eager to list the reasons why they don’t believe in social media platforms.

• It’s for self-promoters or the unemployed.
• It’s for teenagers.
• It’s just over-sharing too much trivial babble.
• It doesn’t directly drive sales leads.
• I can’t control the marketing message.
• There is no measurable ROI.

While all those may be true in some cases, you’re not doing your organization any favors by dismissing the game changing power behind the new social media applications. At a high-level social media marketing is about influencing the customer experience by engaging in dialogue with the customer in order to build a trusted relationship over time. The customer experience refers to all touch points people have from the moment they are aware of a need until they have fulfilled the need or reached a certain goal. To make the social-ready transformation an organization may need to adopt a new mindset. Most transformations involve strategy, technology and processes and a social media transformation is no different in that respect.

1. Strategy: How well does your social media plan support your overall marketing strategy?

2. Technology: Do you have the technology and infrastructure to support your social media goals and objectives?

3. Processes: Do you have the operational processes in place to support your social media goals and objectives?

In the last few months we’ve noticed that many organizations tend to fall in the following broad categories as it relates to the key transformation areas above:

The Broadcaster:
The Broadcaster is typically focused on one way communications and is most comfortable in the traditional media world of mass marketing. Leveraging typical “push marketing” tools and tactics the Broadcaster pushes their product towards the audience which may or may not be aware of it. The Broadcaster largely focuses on the features of their product or service and seeks a direct response from the mass audience. Often times the Broadcaster is focused on a short-term strategy that involves a specific event or time-based campaign (Christmas deals, Back-to-School, etc).

The Listener:
The Listener tends to focus on push marketing tactics; but also considers customer feedback. The Listener may have customer listening posts established in the form of brand monitoring initiatives, although those initiatives may be fairly informal.

The Conversationalist:
The Conversationalist is more in the “pull marketing” camp. The Conversationalist is typically interested in interacting with their target market at a deeper level of engagement through tighter relevance, content and stronger brand identification. The Conversationalist is focused on the development of trust and perceived value.

The Community Builder:
The Community Builder is fully in the pull marketing camp. The Community Builder looks for ways to engage their customers and prospects in two-way conversations, and is comfortable with the concepts of user created content and co-creation. The Community Builder is focused on influencing and involving vs. educating and controlling their audience.

Building a social-ready organization is an on-going journey. And that journey as well as an organizations position on the social media continuum is determined by several factors, including; overall marketing strategy, desired customer experience, business model, and the competitive environment. Social media isn’t going away so you need to set a course that’s right for your corporate goals and objectives.

“Only the Employed Need Apply.” According to a recent article in the Wall Street Journal many employers are bypassing the jobless to target those still working, reasoning that those still working are really the top performers. Other strategy guru’s are pointing out that because of record layoffs; the job market is actually flooded with qualified applicants and this presents an opportunity to hire talented employees – at a discount - who would not have normally been available.

An economic downturn can present an opportunity to reposition your team for the future. However; both hiring strategies have drawbacks. Those still working at other firms are not guaranteed to be top performers under your corporate culture. And if you pay a salary below market value, your employees may be less satisfied, and you risk a higher turnover. In the long run, this can cost your company a good deal in lost productivity and time hiring and training.

Do you consider your employees one of your most valuable investments? If so, the current economic environment could provide the cover to build a competitive “employee-based” advantage. What are you doing to plan your hiring so that you receive an optimal return on your investment in terms of productivity, customer satisfaction and the satisfaction of your employees?

June sales are leaving many retailers anxious about the approaching back-to-school shopping season. Consumers continue to buy less and they are more discriminating than ever. However; many brand consultants argue that the recession has not created a pricing shift but a higher degree of awareness regarding the value of products and brands. Today’s discount shopper is clearly reluctant to spend on premium brands if the value is missing.

I recently pulled out C. Britt Beemer and Robert L. Shook’s book “It Takes a Prophet to Make a Profit … 15 Trends that are Reshaping American Business.” Published in 2001, trend #6 reads:

“Consumers Are Reluctant to Pay Full Retail Price”

Their research showed the number one reason Americans dislike paying full retail price is that they think prices are too high. Fifty-seven percent of discount shoppers expressed that opinion. In addition, they reported:

• 82 percent said they knew the item would be on sale someday.
• 82 percent also said that somebody always has it on sale.
• 79 percent said they normally wait for sales because they don’t need an item right away.
• 46 percent felt that quality has suffered.
• 34 percent said that service has declined.

It’s difficult to read consumers because they are not always consistent. But when your customers are skittish about spending it’s not hard to see that both quality and value for the dollar are important.

Grocery store’s who tried to attract customer’s by influencing the customer shopping experience via coffee bars, fancy bakeries and the availability of exotic products are going back to the basics. Major players such as Kroger, Stop & Shop, Publix and other big food chains are now refocusing efforts on the middle aisles where as much as 70% of their weekly profits are generated. In fact, many retailers are also expected to slice the assortment of products in their stores by at least 15%. According to a recent article in the Wall Street Journal (“Retailers Cut Back on Variety, Once the Spice of Marketing”) retailers are trying to cater to budget-conscious shoppers who want to simplify shopping trips and stick to familiar products.

Incremental variations on popular products can be confusing since some 47,113 new products, variations or sizes were launched last year, more than twice as many as in 1998. For example, a typical Target store has 88 kinds of Pantene shampoo, conditioner and styling products. How many hair products do you need? I don’t need any; but then again, I’m nearly bald. If your favorite grocery retailer stops carrying a specific product in the size, flavor or fragrance you prefer are you likely to defect to another store? I’m not; however, if they change my experience by closing more check-out lanes that could make a difference because I hate to wait.

The current economy is forcing changes that may impact the customer experience. What is a show-stopper for you?