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Why do we read e-mails marked as LOW PRIORITY first?
Is it that the blue down-arrow is so uncommon it stands out?
Is it because we know that it's non-urgent, probably personal, and fun? It, therefore, deserves to be opened immediately?
I have found that I get faster responses from a recipient when I select the LOW PRIORITY option... Faster than a NORMAL e-mail... and often times, faster than an URGENT red exclamation point message.
Interesting.
We continue the ACCORDING TO BLOGGERS conversation with Marketing Professor Philip Kotler’s written response to this question:
What is your opinion about big company mergers? Al Ries writes about losing focus and suggests that companies selling different kinds of products shouldn’t merge. What’s your opinion on this?
KOTLER: I am less concerned than Al Ries about a company selling different products. P&G sells hundreds of products and does well. I am more concerned with whether the merger good makes sense. Does it eliminate duplicate costs? Does it combine complementary activities and skills? Does the merger benefit from any synergies? I view less favorably conglomerate mergers that simply make a company bigger but not better
BLOGGERS: What say us? What’s our opinion about company mergers which create bigger and bigger conglomerates?
johnmoore: Like Kotler, I’m less interested in businesses that get bigger by acting bigger. And as a marketer, I’m much more interested in businesses that get bigger by acting smaller.
Businesses that get bigger by acting bigger are motivated more by appealing to analysts working on Wall Street rather than customers living on Main Street. I’m still trying to understand how customers will benefit from the Proctor & Gamble and Gillette merger. Same goes for the Kmart and Sears merger.
The way I see it, businesses can get bigger by acting smaller if they follow core jumboSHRIMP marketing rules like:
John Perry Barlow’s mundane gadget fantasy is brilliant. He wants a universal electrical plug that can work with any device anywhere.
"It is not as if the adapter cartel has found a way to make a lot of money," Barlow says. "But think of the time and productivity that is wasted by people trying to figure where they left their adapter or what they're going to do to get their device to work without it."
[SOURCE: Wall Street Journal article | May 23, 2005 | pg. R6]
Thanks for your comments... your great comments... You're hired!
You are totally right in your suggestions... Slow cooked chili is better.
However... I've not given up... I'm re-examining.
I have confidence that I would put together a phenomenal, buzz-worthy place...
This development (of a competitor getting there first) has added a huge factor into my business equation... I'd be a fool not to re-consider my original plans...
When I did my market analysis... it was pretty clear the idea was even stronger because there's nothing like it within 2000 miles. Now there's a place within 20 miles.
I'm not chickening out... I'm being smart about my plan. I want to work smarter, not harder.
Does it make as much sense to open a brainstorming place in a town that's got a brainstorming place?
I met with Kevin Hoffberg, the CEO of ThinkSpot yesterday afternoon. I had to. We are too like-minded. They've got some big plans over there at ThinkSpot and are in a different position than I am in (both financially and with an existing customer base).
But meeting with Kevin opened a different set of doors as well...
So now I'm in a spot to explore these options...
1. In Bruce's words... "Be the first in the mind of the customer. Do it better, or not at all."
2. In Adam's words... "Offer something that they don't to differentiate."
3. In the words of the old adage... "If you can't beat 'em, join 'em."
In the words of Snagglepuss... "Heavens to Murgatroid!"
Thanks folks for your well-thought words.
I'll keep you posted.
Jonesin’ for some wisdom from today’s preeminent business sage? Get your Peter Drucker quote fix from BrainyQuote. Here’s a sampling:
For more Druckerisms, click here.
Thanks Entrepreneur magazine for citing Brand Autopsy as a worthy marketing blog to read. Kudos also go out to the blog company we keep -- smallbusinessbranding and MarketingVox.
[SOURCE: Entrepreneur magazine | June 2005 | pg. 97 | author: Gwen Moran]
I received an e-mail today, forwarded from a friend, announcing that ThinkSpot in Seattle is having their Grand Opening Gala next month.
What is ThinkSpot?
"ThinkSpot is a brand new meeting and event facility... We are housed in an artist loft studio building, and our spaces have been specifically designed to encourage creativity, collaboration, and forward-thinking."
Sound familiar?
Yep. Same concept as the Idea Sandbox project I've been discussing.
"The Idea Sandbox will be the most creative meeting space on the west coast.
One step inside this idea wonderland, you’ll understand how Idea Sandbox is inspiring businesses and entrepreneurs alike to dream the unthinkable and do the impossible."
What's better? The real estate I was planning to lease is literally 10 seconds from where they are opening in June.
I'm sure the folks at ThinkSpot did the same research as I... Determined that Seattle could really use a creative meeting space... A creative meeting space. Not two. Especially not two across the street from each other.
So now what?
What do you do when competition beats you to the market? (Perhaps this is a post for another day).
Here's what I've done so far...
Keep your aggregators pointed here.
(This entry is simulposted on the Idea Sandbox blog).
Brand Autopsy readers … I’m working on a writing project and would like to tap into the wisdom of the blog crowd.
Please help me in identifying benchmark businesses that have seen their market dominant position crumble because of complacency, conservatism, and conceit.
Thanks y’all for your help here. I promise to share more about this writing project in the weeks/months to come.
Lifting author Seth Godin's words directly from the book, below is the Brand Autopsy mash-up [marketing club remix version] synopsis of LIARS.
All marketers tell stories. And if they do it right, we believe them. Successful marketers don’t talk about features or benefits. Instead, they tell a story. A story we want to believe.
Marketing is the story marketers tell to consumers and then maybe, if the marketer has done a good job, the lie consumers tell themselves and their friends. Some marketers focus so hard on the facts of their offering that they forget to tell a story at all and then wonder why they’ve failed.
Stories are shortcuts because we’re too overwhelmed by data to discover all the details. Marketers tell the stories, and consumers believe them. Some marketers do it well. Others are pretty bad at it.
Great marketers tell stories we believe. The marketer tells a story about what the consumer notices. The story changes the way the consumer experiences the product or service. Storytelling only works when the story actually makes the product or service better.
Storytelling isn’t Seth’s idea. It’s the idea of customers. It’s customers who want to be told stories. It’s your prospects who will walk away if you obsess about the last sigma of this or that without bothering to tell a story about it.
There are no small stories. Only small marketers. If your story is too small, it’s not a story, it’s just an annoying interruption. Make your story bigger and bigger until it’s important enough to believe.
Paul and I each connected with Seth’s worldview of marketing being all about storyselling … we mean … storytelling. Below you’ll find a jump-list of seven posts where we frame up our observations/impressions from LIARS and from an email exchange we had with Seth.
First, don’t get hung up on the title of the book.
Seth uses the ALL MARKETERS ARE LIARS book title as a device to create intrigue and dare I say it … to be more remarkable. Seth doesn’t really believe marketers are liars. He does, however, believe consumers are the real liars in the marketing game. Consumers tell themselves lies every day about products and services based upon the stories they hear from marketers.
Second, do get hung up on the storytelling concept Seth talks about.
According to Seth, storytelling is the new leverageable asset for marketers. No longer can we rely on gaining a competitive advantage solely through better inventions or better production methods. However, we can gain a competitive advantage by telling stories which make our products or services better.
Telling stories only works when the story is credible in telling facts (needs) and incredible in conveying desires (wants). Marketers should craft stories focusing more on consumer want-states and less on consumer need-states.
Don’t try to tell a similar story as your competitors do. You will not find success by trying “to tell your competition’s story better than it can.” Instead, follow Seth’s advice of telling a different story to consumers which “… is more important than the story they currently believe.”
Third, don’t just read the book … use the book.
Scribble notes. Highlight pithy insights. Dog-ear pages to calculate its Dog-Ear Score. And by all means, once you’ve finished reading the book … take time to type up your notes and highlighted insights into a couple pages of takeaways. I get the most out of business books when I write-up my own list of takeaways – it helps me to go from reading the book to using the book.
In case you're wondering, my Dog-Ear Score for LIARS is 18.5% (32:173) and a typical scribbled-filled and highlight-laden page for my copy looks like:
If you judge his book "All Marketers Are Liars" by the cover, you'll think Seth is promoting irresponsible marketing practices. Getting past the title and into the pages, you'll learn...
"The only robust, predictable strategy is a simple one: to be authentic. To do what you say you're going to do. To live the lie, fully and completely." - pg. 101
The Executive Summary could be:
"The public demands that you tell them a story. The story is part of the product or service that they buy - in many cases, the story is what people set out to buy. But at the core of a story is the thing, the real thing, the essence of what you've built. And if you try to build on a rotten core, you'll succeed for a bit but then you'll lose." - pg. 104
My reading of "Liars" elicited a solid Dog Ear Score of 17% (30:173).
I appreciate how Seth gives you thoughts to ponder and nuggets you can immediately use... Here are some of my favorite quotable quotes from "Liars.
"Not only will some people spread your story more than others but often they'll compete with each other to see who can do it more prominently." - pg. 57
I find this an interesting way to categorize some blogging communities... Seems we each spend a lot of time not only trying to get the scoop on a new business trend, or even label a business trend, but also try to out blog each other.
"Spending an inordinate amount of time and money on your sign or your jingle or your Web site is beside the point. It's every point of contact that matters. If you're not consistent and authentic, the timing of the first impression is too hard to predict to make it worth the journey. On the other hand, if you can cover all the possible impressions and allow the consumer to make them into a coherent story, you win." - pg. 74
Seth highlights, in "Liars" a common challenge marketers (and business owners) struggle with – the strong desire to try to educate customers... We believe that if customers only understood our products as much as we do – customers would automatically 'get it' and HAVE to buy it.
"It's easy to tout your features, focus on the benefits, give proof that you are, in fact, the best solution to a problem. But proof doesn't make the sale. Of course, you belive the proof, but your audience doesn't." - pg. 89
The solution you give to marketers is to allow customers to self discover the facts about your products versus lecturing. Could you elaborate on suggested ways to put these facts out there without lecturing?
SETH: I think the best marketers are subtle. The facts are there… on the box, or in the experience, or in the reviews… but they don’t yell them. Microsoft isn’t subtle, but Palm was, for a long time. Intelligent consumers will prefer to read it on a blog or hear it via word of mouth or figure it out. And intelligent consumers are the ones you are likely to start with.
In the "Liar" chapter, IMPORTANT ASIDE: FIBS AND FRAUDS, Seth suggests that the wise consumer should put themselves in the shoes of the marketer... The consumer should ask the marketer:
“If I knew what you know, would I choose to buy what you sell?” - pg. 108
But what's taking place with folks who buy products from infomercials? Seems that 98% of infomercial-based products are about sizzle vs. substance. How many times has an item actually lived up to its infomercial claims. Yet, people still buy? What gives?
SETH: I think the act of buying something from an infomercial is like buying Xray specs...
You’re not really buying a product. You’re buying the way it made you feel to buy it and watch the show and wait for it to arrive. My grandmother, who died a few years ago, loved to talk about an exercise device she saw on TV. You plugged it in and it exercised for you! If she had ordered it, she never would have opened it. The ordering would be enough. Like people who buy, but never follow, diet books.
“Don’t try to change someone’s worldview is the strategy smart marketers follow. Don’t try to prove your case and to insist that people change their biases. You don’t have enough time and you don’t have enough money. Instead, identify a population with a certain worldview (personal perspective), frame (position) your story in terms of that worldview and you win.” [ALL MARKETERS ARE LIARS | pg. 33]
Given Seth’s wise advice, it appears the marketers at Miller Brewing Co. are going to lose.
In a move to increase market share for its inexpensively priced Milwaukee’s Best brand, Miller has decided to spend time and money on an advertising campaign designed to change the worldview of beer drinkers.
Cash-strapped college kids and cheap beer drinkers alike adoringly refer to Milwaukee’s Best as the “Beast.” Calling Milwaukee’s Best the “Beast” symbolizes the worldview of these beer drinkers. Yet according to a recent article in the Wall Street Journal ...
“… one of (Miller’s) first priorities will be to rid Milwaukee’s Best of the “Beast” nickname, which it has had for decades. In the coming months, it will push Milwaukee's Best with a television and print advertising campaign. One print ad shows a woman in a cut-off T-shirt with a tattoo of a bass on her back. "The perfect Milwaukee's Best woman because she drinks beer and likes to fish," (Peter) Marino (Miller spokesman) explains. A spot for Milwaukee's Best Light will say, "Men should act like men, and light beer should taste like beer."
In LIARS, Seth mentions “… changing a worldview is fairly glamorous work, it doesn’t often lead to a lot of profit.” So it appears the marketers at Miller Brewing Co. want to live the glamorous marketing life, but they are setting themselves up to fail.
They’re going to fail because the “Beast” nickname is way too ingrained in beer drinker’s minds to try and change it now. And come to think of it … the only thing remarkable about Milwaukee’s Best is the “Beast” nickname. (Which by the way didn’t come from the Miller marketing department, it came from the folks who actually drink the beer.)
Instead of cranking out generic advertising sloth (see billboard above), Miller should embrace the beer drinker’s worldview of calling Milwaukee’s Best the “Beast” and make up great stories about it.
Because as Seth says in LIARS, “The organizations that succeed realize that offering a remarkable product with a great story is more important and more profitable than doing what everyone else is doing just a bit better.”
Seth, in "Liars" writes on a topic Brand Autopsy calls "jumbo shrimp." How a company that is getting big, can stay small.
In the MARKETERS WITH AUTHENTICITY THRIVE chapter you comment about this issue...
Companies focus on growth... Franchise the business... End up hiring folks who aren’t as passionate as the founders... The story (company) loses its authenticity.
I see this as a challenge for Build-A-Bear Workshop and Krispy Kreme. (KKs recent issues aside A, B, C)... Both companies have been recognized for delivering unique customer experiences (telling unique stories). I’m wondering how they can maintain the experience as they increase their store counts...
You highlight a great example in the section called FAKING IT WITH ICE CREAM about Cold Stone Creamery. With growth, the story gets diluted and loses its meaning.
Any thoughts on how companies can get big and stay small? Can expand, yet keep the story (experience) authentic?
SETH: Well, I’m not sure that these companies WANT to stay authentic. I think they want to get big, go public, cash out and then, if they crash, well hey.
It’s a come to jesus moment for the founder. Yes, of course you can grow organically and keep it working (they say Morton’s steakhouse has done this). But it won’t be as fast and it won’t be as profitable and you’ll last a lot longer.
With a nod to Robert Boynton’s NEW NEW JOURNALISM, I asked Seth a few questions related more to his writing style than to his marketing style. In this interview, Seth shares how (and why) his writing style has evolved over the years, who his influencers are, and about the organic story he tells himself.
Talk about how your writing style has evolved from PERMISSION MARKETING to LIARS.
SETH: Blogging has really messed me up. If it’s more than four paragraphs, I think it’s too long. As a result, I have to push myself to make those four paragraphs sharper and more cogent. I feel like someone giving a speech at a toll booth. Talk too long and they’re gone.
What writers have influenced you most and why?
SETH: Guy and Zig and Tom and Malcolm are my big four. I love that they all are recognizable just by first names! In all four cases, the writing is generous and positive and sharp and a little unpredictable. 90% of the biz books I see I could write the rest of the book after reading just the first chapter.
In blogland, I’m finding a few writers (like Hugh—there’s that first name thing again) that every so often click and define the way this medium is going to sound.
Describe the writing routine you used for LIARS.
SETH: Some books take me a long time (like Survival is Not Enough). Some take three weeks (like Purple Cow, for the first complete draft). This was a little of both. I wrote a very, very long first draft pretty quickly, then it took me months to shorten shorten shorten. I wish I had shortened it by another 50 pages.
What was the greatest challenge you had to overcome in writing LIARS?
SETH: People have a very visceral reaction to the title. I had to figure out how to use the word Liar correctly (my friend Karen Watts helped a lot with that) and how to explain myself without giving away the entire conceit.
From my marketing days at Whole Foods Market, we found most consumers who choose to eat organic foods do so following some life-changing experience. In LIARS you referenced your preference for organic products. I'm curious, what was your organic inflection point?
SETH: Since I was a freshman in college, I’ve been in this never ending cycle of tweaking my food intake and making it healthier. First I was a vegetarian. Then a veggie who ate no dairy, then no fat and then on and on. I’m pretty profoundly opposed to the side effects of cattle (on us and on the planet) and I wish agribusiness would wise up. Organic seemed like a good story to tell myself.
It's not as often we Mac folks get a Mac-only application that can make PC users drool... But Delicious Library is one of them.
This catalog software stores a record of your books, DVDs and games on your Mac. But not just in list form... It shows you the book covers merchandised on swanky wooden shelves... It's a neat way to keep track of what books you own. The latest version (1.5) has been built to utilize new features of the latest Mac OS "Tiger."
Here's how it works...
You enter your book information, either by using the search-by-name option or by entering the UPC or ISBN number. What's even cooler, is that you can also scan your items using a your webcam! (It has built-in compatibility with the Mac iSight camera).
Simply place the UPC code in front of your camera and an audible beep indicates your item has been scanned - just like they do at the grocery store with a barcode reader. The next thing you know, your item appears on your on-screen book shelf. (This option is a must for those of us with growing book collections).
'Couple more cool functions... If you loan books out, you simply drag the book (or DVD or game) icon to their name in your address book, indicate the due date and it records who borrowed the book and when. And you can synch your library list on your iPod - pretty cool.
Finally, the feature that made this software worth the $40 purchase... Suggested Reading.
The software is linked to Amazon.com's database. When you click on a book on your shelf and choose the SIMILAR option. A display provides a list of recommended related reading... (Pictured above, this list is to the right of the shelves). It's an indispensable tool for those who enjoy digging deeper into a topic.
PC users... there is a similar product called ReaderWare, but from the reviews I've read it's not as pretty and you'd need to purchase three different apps to manage books, DVDs and games.
A great tool for bloggers and business folk who want a clever way to track your library. Read more about the functionality at the Delicious Monster website.
Enjoy.
ALL MARKETERS ARE LIARS
Business Blog Book Tour
Schedule
Look for insightful commentary about Seth Godin’s newest marketing book, ALL MARKETERS ARE LIARS, beginning next Monday at these way worthy blogs:
Like McDonald’s, Starbucks is a concept driven as much by real estate as it is by coffee and the coffee experience. These days Starbucks opens at least three new locations a day somewhere in the world. It has taken a lot of real estate to open up 9,000+ Starbucks locations and it will take even more real estate to reach their stated goal of 30,000 global locations.
There is much to learn about Starbucks expertise in the real estate game and Arthur Rubinfeld, former EVP of Real Estate with Starbucks, shares many of these learnings in BUILT FOR GROWTH (Wharton Publishing, 2005).
[Heads Up | Arthur covers a lot of territory in this book including branding, business model infrastructure, retail site selection, innovation, and delivering customer experiences. BUILT FOR GROWTH is at its best sharing real estate advice more so than anything else.]
Beginning with Ch. 12, Arthur shares actionable insights into how Starbucks gained market dominance through finding the best real estate locations.
For example, have you ever wondered why so many Starbucks stores are located near dry cleaners and video stores? That’s so Starbucks can take advantage of the ‘going-to-work’ traffic generated from people dropping off clothes at the dry cleaners on their way to work. And, Starbucks takes advantage of people picking up movies from Blockbuster on their way home from work.
Arthur mentions his secret for locating heavily trafficked parking lots – oil stains. Yep, if a parking lot has lots of oil stains, it means lots of cars come and go.
“In retailing,” Arthur says, “you are judged by the company you keep.” That’s why he advocates always locating your store near other tenants who attract a more affluent customer base than does your store. Starbucks avoids locating stores in close proximity to fast food chains because these restaurants generally draw a less affluent customer.
Small business owners looking to become big business owners should pay close attention to the site selection process Arthur shares in Chapter 14. It’s straight from the Starbucks playbook. In fact, you can download a Real Estate Decision Logic Template and a Site Evaluation Form from the book’s website. These templates look very similar to ones Starbucks used in the mid-to-late 90s. (To access these templates as well as other tools, you will need to ‘register’ with the site.)
We continue the ACCORDING TO BLOGGERS conversation with Marketing Professor Philip Kotler’s written response to this question:
Some people say that marketing techniques create false images about products and companies. How would you answer that?
KOTLER: Marketers will exaggerate the positive and eliminate the negative aspects of their offering, much like a lawyer who takes one side of an argument and blows up its positives. At the same time, companies would be wise to avoid creating false images of their products.
First, if consumers try the product and are disappointed with its performance, they will tell many others of their disappointment. In this case, the company gained a sale but lost a market. Second, competitors will threaten to sue a company that is trying to gain an advantage by falsifying its product’s performance. So while there are plenty of techniques for exaggerating, smart firms will describe their true competitive benefits rather than over-promising and underperforming.
BLOGGERS: What say us? What’s our response when some people say marketing techniques create false images about products and companies?
johnmoore: I agree with Prof Kotler. These smart firms Kotler speaks of engage in meaningful marketing which connects with people by telling them the true, but compelling, story of why a business is remarkable. Meaningful marketing is about designing marketing activities to deliver on the vision of the business all the while being clever, savvy, and authentic. It’s about treating people as being interesting and interested. And, it’s about building brand preference more than brand awareness resulting in loyalty beyond reason from customers.
Unfortunately, many marketing practitioners still believe in making up stories about why a product is special. They engage in outrageously gimmicky attention-grabbing antics that over-promise and woefully under-deliver. These marketers treat consumers as being boring, indifferent, and brainlessly gullible. (And we wonder why consumers have become cynical and distrustful of marketing … hmm.)
As a marketer I’ve never had the challenge of having TOO MUCH money to spend on advertising. (Instead, the marketing budgets I’ve managed at Starbucks and Whole Foods have been more svelte than obese.) But there are plenty of companies with obese enough budgets to spend millions per year placing billboards on Times Square.
Advertising Age recently ran a very interesting story on the Times Square advertising scene. A few takeaways from the article include:
Further Reading:
Wander over to the 800.CEO.READ blog for my review of three books which will help you communicate better at work. Books mentioned include:
Need a quote to help ya better champion out-of-the-box marketing ideas? Try this one from marketing professor Philip Kotler …
Good marketing is partly a matter of following the rules.
Great marketing often happens by breaking the rules.
[SOURCE: Philip Kotler | ACCORDING TO KOTLER | pg. 38]
I just finished reading Lior Arussy’s latest biz book, PASSIONATE & PROFITABLE. It’s an HBR article on steroids going deep into how companies can better develop passionate and profitable relationships with customers.
Much of the book stems from a Customer Experience Management Study (.pdf) conducted by Lior’s Strativity Group in 2003. One mind-boggling finding from this study is 45% of surveyed executives felt their company didn’t deserve the loyalty displayed by their customers. (WOW!)
One idea from the book I’m going to implement with my clients is the notion of writing a Customer Job Description. On page 75 of PASSIONATE & PROFITABLE Lior writes,
”Imagine that your customer works for you. Just like an employee, the customer will do what you tell him or her to do and be measured accordingly. Imagine that you can assign roles and responsibilities that you will expect him or her to live up to. This is the essence of defining your expectations from the relationship.”
A Customer Job Description … nice idea Lior.
We continue the ACCORDING TO BLOGGERS conversation with Marketing Professor Philip Kotler’s written response to this question:
How can companies become more customer-centric?
KOTLER: The company’s CEO needs to manage a whole process – spread over a number of years – to move the company to deep customer-centricity. Here are the steps:
BLOGGERS: What say us? How can companies become more customer-focused? I’ve got a few ideas and I know you do as well.
johnmoore: I'm surprised Kotler lists 10 ways for a company to become more customer-focused and none of the ways mention the CUSTOMER. My off-the-cuff advice for a company to become more customer-centric is:
The following quote is suitable for any presentation from a Word-of-Mouth Marketer or Customer Evangelist evangelist …
”Advertising is when you tell people how great you are.
PR is when someone else says how great you are.”
SOURCE: Guy Kawasaki, THE MACINTOSH WAY (HarperPerennial reprint, 1990)
We continue the ACCORDING TO BLOGGERS conversation with Marketing Professor Philip Kotler’s written response to this question:
What do you think are the most important factors in creating customer satisfaction these days?
KOTLER: Customers are most concerned with quality, service, and value. All of these constitute competitive opportunities in markets where they are lacking. However, we are noticing that many companies and industries are rapidly improving their quality, service, and value. Consequently, these benefits are becoming normal expectations rather than distinctive winning attributes. Now design, speed, and customization are becoming more critical in influencing customer choice. Depending on the industry and product type, market leaders will find further attributes and benefits that they can turn into salient and compelling differentiators.
BLOGGERS: What say us? What factors do we think are most critical in creating satisfied customers? I’ve added a few thoughts – feel free to do the same.
johnmoore: The most important factor in customer satisfaction can be summed up in one word … FOLLOW-THROUGH. (Okay, two words and a hyphen.) The actions of companies need to follow their marketing rhetoric. Simply put, companies need to DO what they SAY they will do in all their conversations with customers. Forget layering on customer loyalty and customer appreciation programs, the most meaningful way for companies to create satisfied customers is to simply do what they say they are going to do.
The other week we mentioned the indifference shown by Ken Ferree, CEO of the Corporation for Public Broadcasting, in a NY Times Sunday Magazine profile.
Compare Ken's indifference with the endearing comments from Burger King’s CEO, Greg Brenneman.
In a recent Wall Street Journal article, Brenneman comes off as being down-to-earth, transparent, and downright giddy about Burger King and its products. It’s also worth noting his responses use crisp and clear language. (How rare is it to hear a CEO not use vapid and vacuous jargon? Too rare.)
Highlights from the very smart interview are below and you can download the article by clicking here (.doc).
WSJ: Your turnaround formula includes boosting a restaurant's average annual sales from $970,000 to about $1.3 million. How will you do this, and sustain it?
Brenneman: It's the million dollar question. We knew Wendy's was at $1.3 million. McDonald's was at about $1.9 million. I said, what's a good interim goal? If you said $1.9 million, everyone would look at you like you're on drugs. We said, we can get at least as good as $1.3 million. That doesn't happen in a year. You can only develop things so fast.... There were a ton of gaps that existed in our offerings versus our competitors. The pantry was fairly bare. There was no thick burger. No whole-muscle chicken sandwiches. No salads. No chicken strips. No limited breakfast menu.
WSJ: Speaking of indulgent, you call your best repeat customers "Super Fans" -- the 18-to-34-year-old males who come in three to four times a week. How are you strengthening efforts to appeal to them?
Brenneman: If you think about what drives our business, "Super Fans" are something like 25% of our customer base, but 50% of spending. If we just get one more visit out of the Super Fan, it's like a 10% increase in comparable sales. It's about understanding who the core consumers are and getting the kind of indulgent products they want. You can't be everything to everybody. If you look at the Enormous Omelet Sandwich, we didn't beat around the bush with the name. It's an indulgent breakfast sandwich, and it's absolutely geared at the Super Fan.
WSJ: What do you eat?
Brenneman: I'm a Double Whopper fanatic. What I go in for on a regular basis is the salad. With chicken on it, it's terrific. You can put reasonable dressing on it and have a terrific meal if you need to watch your girlish figure.
WSJ: You've described Burger King's culture as having had an "entitlement attitude." What do you mean?
Brenneman: We were part of Diageo. This was a subsidiary of a British business. Because no one told people how they were doing, no one knew if they were making money or losing it. People just began to think of it as something they were entitled to -- this salary, these benefits. It was coming from a booze business that made 80% margins. So we started telling people...we're making this much money, we got bonuses tied to profitability. We're just ourselves now. The guy who's saving us is the guy who's looking in the mirror.
WSJ: How does your relationship with Burger King's owners help, since you answer to them rather than to public shareholders?
Brenneman: We have a great relationship... because they're friends, they're business partners, they're incredibly smart businessmen and women, and they're a phone call away. Sales are up. Profits are way up. They go work on whatever else is troubling them in their portfolio.
WSJ: You've got about 11,000 restaurants globally. How many do you think you can reach in the next five years?
Brenneman: I don't have a number. The thing in the past was, let's just grow. I'm more concerned about profitable growth. As the cost of building the restaurant comes down, the return on capital changes dramatically...that will drive how many restaurants will get built.
There are many places where we want to put more Burger Kings. Internationally, we are in 65 countries around the world. Not one of those 65 countries [is] totally built out. We entered Brazil this year, it's growing like gangbusters. We'll enter China later this year. We have many markets where we can grow our presence without over-saturating or cannibalizing our own sales.
WSJ: How soon might we see an IPO?
Brenneman: If we do an IPO -- and that'll be up to the sponsors how they want to exit. I don't think they're in any hurry, but everybody knows these guys don't hold onto things forever. My guess is not in calendar year '05, maybe in calendar year '06. To do an IPO you need company performance, and it's good right now. You also need the market to be solid. I think it'd be a great thing for our system. Being able to read about yourself in the stock exchange everyday is something our franchisees look forward to. But it's by no means critical to us.
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