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June 29, 2006

Mimicking Whole Foods Market


NOTE: updated to reflect the proper Giant Eagle name & logo

Wfmmimics2

USA Today reports how some grocers are doing their best to mimic Whole Foods Market (WFM). Publix is opening Publix GreenWise Markets, Giant Eagle is wooing foodies by opening Market District stores, Safeway is test marketing a lifestyle store in Boulder, CO, and Wal-Mart has just opened a snazzy new store in Plano, TX which highlights hundreds of natural/organic products.

For me this is like déjà vu all over again since I’ve not only done the marketing thing at Whole Foods but also at Starbucks. While at Starbucks, I saw many ambitious coffee competitors like Caribou, Cosi, Tully’s, Gloria Jean’s, CC’s, and others all trying to mimic Starbucks success in some way. And they all have fallen short in some way.

I’m certain this same fate of falling short will be the outcome of the grocers listed above trying to mimic WFM’s success.

Why am I so certain? It’s simple … competitors can replicate products and programs but they can’t replicate people.

Publix, Giant Eagle, Safeway, and Wal-Mart are all trying to replicate the products and experiences Whole Foods delivers, but they can’t replicate the people Whole Foods has delivering the products and experiences to customers. Products and programs do not create brands, people create brands. It’s the people that matter more in creating a brand than do products or programs.

WFM understands the power of a knowledgeable, caring, and passionate workforce in creating highly satisfied customers. They’ve created a company culture which connects with their team members (employees) and they in turn, pass that connection onto WFM shoppers.

If one were to take the WFM team member out from its business, Whole Foods Market would not be the successful company it is today. Try saying the same thing for Wal-Mart. You can’t. Right?


For more Brand Autopsy marketing musings on Whole Foods Market, go here, here, here, and here.

To Widget or Not to Widget?

I recently installed the Typepad widget which opens links from Brand Autopsy postings in a new window. Well, I just received an email from a reader who doesn’t like new windows opening when she clicks on the links. Anyone else feel the same? Anyone like embedded links opening in new windows on the blog? Your feedback will determine whether I widget or not. Thanks.

June 28, 2006

Advertising’s Little Blue Book

Advertisings_blue_book_1

Someone from somewhere at some recent time sent me a copy of THE LITTLE BLUE BOOK OF ADVERTISING. Readers of this blog know my marketing mindset is along the lines of spending marketing dollars to make a customer’s experience better and not necessarily spending dollars to make the advertising better. So yeah, I read this book with a grain of salt the size of a salt lick.

The authors, Steve Lance and Jeff Wool, are long-time ad guys and in the book, they share 52 tips they’ve learned over the years working in the advertising game.

It’s an easy read (albeit choppy at times) with some brilliant and banal insights including ...


”You don’t have to be a billion-dollar brand to do quantitative and qualitative research. It’s as simple as asking everyone who comes into your store (and keeping all the data for analysis) ‘how did you hear about us?’ (quantitative research) and ‘what made you stop in?’ (qualitative research).” (p. 22)

>> You’ll be hard-pressed to demystify the notion that small businesses can’t do customer research better than that.


”Not knowing where you want to take your company/brand—realistically—is management malpractice at its worst. It’s a virtual guarantee for financial failure.” (p.59)

>> Okay, this nugget might not be brilliant but the marketing doctor in me thought the use of “malpractice” in a marketing context was brilliant.


”Take a look at your advertising and marketing plan. Not the budget, the plan. And not the media plan, either. We’re talking about a written plan that says (in effect), ‘We’re going to do X in order to achieve Y and this is how we’ll do it in Z time frame.’” (p. 66)

>> I’ll gladly borrow that X-Y-Z line when talking with small business clients about how to simply (and surely) develop an actionable marketing plan.


”Where do you want [your business] to go? The answer’s simple: you want to go where your best customers are and where they’re headed. Ideally, you want to get there a little before them. Research provides the best opportunity to understand where that is.” (p. 75)

>> Again, Steve and Jeff use real words with real meaning to explain how customer research can help companies set forth a vision for the business. Nice.


”The fact is, an ad that talks about how great a company is, is an easy ad to sell internally. Your boss likes it because he knows it’s going to please his boss. His boss likes it because he knows it’s going to please the president. The president of the company is thrilled that you’ve put in writing how good your company is. And everyone gets to go home at 5PM.” (p. 93)

>> Yep … that explanation sums up why we tend to see so many hubris-heavy marketing messages from companies. Makes complete sense to me. I saw this happen repeatedly during my days working inside Starbucks.


”To get the best and freshest work from your people, follow the advice of an art director we know, “Stay in the area of the problem, not the area of the solution.” (p. 113)

>> Not sure I totally know what that line means but I’m sure to chew on it until I do. There’s something powerful in their advice of spending mind-time in the area of the problem and not the solution.


”Steve had a boss who taught him the true art of hall walking: ‘Walk the halls at 7 PM; it’ll take you to the problem every time.’ His theory was that the people who were still there at that time were either a) the dedicated employees staying late to clean up someone’s mess or b) the problem employees who were overwhelmed and couldn’t manage their jobs. Either way, the conversations he would have with the 7 PM people would often reveal the organizational issues.” (p.121)

>> Sure, that’s a total riff off Tom Peters’ MBWA (management by walking around) concept. But there is brilliance in the idea of roaming the hallways at 7PM on a workday to discover what problems are taking too much time of employees.



"In real estate, it’s location, location, location. In marketing, it’s brand, brand, brand. Start diluting it and you’ll wake up one day with a name that means . . . nothing." (p. 35)

>> It’s become tired and trite to play the BRAND IS EVERYTHING card. Think about every endearing and enduring business you admire. (For me that’s … Starbucks, Whole Foods Market, Google, Chipotle, Pei Wei, Container Store, Trader Joe’s, Lexus, In-N-Out Burger, Jones Soda, Apple, etc.) How many of them were built on brand advertising and how many of them were built on being a better business? You cannot create a brand before you create a business—the process is simultaneous. As you build your business, you create your brand. Dig?


”If your product’s the same, then turn to the research and marketing people. What’s the unique selling proposition they can come up with that will set your product apart from the competition?” (p. 100)

>> Oh my! Let’s stay in the area of the problem and not the area of the solution. The solution for a non-compelling product is NOT to offer creative selling propositions. That’s band-aid marketing at its best (and worst). The long-lasting solution here is to address the root cause of the problem and spend marketing dollars to make the product more compelling and not to make the selling proposition more compelling.


”Its repetition, repetition, repetition that makes your advertising memorable and successful. (p. 163)

>> This “Tell’em, Sell’em, and Tell’em Again” angle is classic jurassic advertising thought. Remarkability/Fanaticism in many ways has replaced the classic jurassic advertising approach of Reach/Frequency.


“The Internet (in case you didn’t know it) is just print delivered on a different platform.” (p. 175)

>> Really? And a laptop is just a typewriter delivered on a different platform.


”SALE! Don’t ever hide that word. Some people say it’s the most powerful word in the English language. We’re not sure about that, but it’s definitely in our Top 10.” (p. 193)

>> Paraphrasing Seth Godin from PURPLE COW … a marketer that relies on low price marketing strategies is a marketer who is out of ideas. This marketer believes the word ‘SALE’ has lost its salience.


June 27, 2006

Word-of-Mouth Marketing Ideas. Some Worthy. Some Worthless.


UPDATED | July 14, 2006

>>WOMMA has posted a PDF version of these 43 Word-of-Mouth Marketing Ideas complete with attributions.


After some prodding, Spike Jones (not be confused with this Spike Jones, nor that Spike Jonze) runs the WOM voodoo down by offering his “worthy”/“worthless” opinion on the 40+ Word-of-Mouth (WOM) marketing ideas offered during a panel discussion at WOMABT2.

The panel promised 40 actionable word-of-mouth marketing ideas in 40 minutes and according to Spike, some ideas were worthy while others were worthless.

I’m just doing a scalpel/suture (copy/paste) maneuver by lifting Spike’s work directly from the Brains on Fire Blog. (Yes, I’m pimpin’ the Brains blog again. Add it to your RSS feed already!)

Take some time to read through all of these ideas (even the worthless ones) because they will help kickstart your company's foray into WOM.



SOURCE: Spike Jones posting from Brains on Fire (June 26, 2006)

1. If you train your sales force in the ways of evangelism, they become better recruiters. SPIKE SAYS: WORTHY, but not exactly a “go home and implement” tool.

2. Make it easy for people to find you and tell people about you.
SPIKE SAYS: WORTHY

3. Create a market advisory council.
SPIKE SAYS: WORTHY

4. Use interesting stories to bring your WOM topics to life.
SPIKE SAYS: WORTHLESS – your identity should already do that.

5. Encourage your brand champions to tell two friends about you, not just one.
SPIKE SAYS: WORTHLESS – Give them something to talk about

6. Do something unexpected and generous for your customers — send a free product (include an extra for them to pass along to a friend) just for being a valued customer.
SPIKE SAYS: WORTHY, but you don’t have to bribe your customers, just surprise and delight

7. Identify influentials using online social networking sites.
SPIKE SAYS: WORTHY, depending on your views of “influentials”

8. Reach the influencers that don’t raise their hand.
SPIKE SAYS: WORTHLESS

9. Create experiences around your products and services.
SPIKE SAYS: WORTHY

10. Be an evangelist for your evangelists (Send them framed versions of case studies you’ve
done with them, blog about them, show them off in your newsletters.)

SPIKE SAYS: WORTHY

11. Use a memorable collectible as a dinner table centerpiece with the winner’s sticker on the bottom of their chair.
SPIKE SAYS: WORTHLESS – this is just a sad gimmick, not a WOM tool

12. Give your audience business card holders packed with ‘tell-someone’ referral cards.
SPIKE SAYS: WORTHLESS – another bad giveaway gimmick

13. It’s not just marketing: embed WOM into your sales culture.
SPIKE SAYS: WORTHY, but not take home actionable.

14. Use humor or “did you know” language to help consumers feel like they have something funny or unique to add to the conversation.
SPIKE SAYS: WORTHLESS

15. Ask your customers to talk about you.
SPIKE SAYS: WORTHLESS – this is WOM creationism!

16. Hide it. Discovery is a trigger for WOM, so make your tool or marketing message hard to find and you’ll create something people will want to talk about and share.
SPIKE SAYS: WORTHY

17. Leverage provocative content to make everyday product talk-worthy.
SPIKE SAYS: Borderline WORTHY

18. Ensure you get the best ideas by engaging your WOM agency early in a paid consulting role.
SPIKE SAYS:WORTHLESS as a WOM tool, but great advice nonetheless!

19. Make friends with some bloggers (they don’t even have to be famous).
SPIKE SAYS: WORTHY – but I would add, “and don’t ask them for favors.“

20. Give your evangelists something to talk about.
SPIKE SAYS: WORTHY

21. Give out your marketing collateral in something noticeable that gets people talking.
SPIKE SAYS: WORTHLESS – another gimmick

22. Create a story and let consumers share their best stories of interactions with your product or service.
SPIKE SAYS: WORTHY

23. Create a VIP customer pool and use it.
SPIKE SAYS: WORTHY

24. Make it easy for people to easily spread the word about you (Create a button for their blog or web site, a card or CD they can pass along to a friend, or build a ‘tell a friend’ option.)
SPIKE SAYS: WORTHY

25. Release exclusive content (”insider information”) and let your avid customers react and interact with it.
SPIKE SAYS: WORTHY

26. Create clever 30-second virals and post to your home page.
SPIKE SAYS: Borderline WORTHY – in this day and age of viral saturation, it’s gonna have to be either really great or really relevant to be effective.

27. Take a cue from gossip rags such as InFocus or US Weekly and use surveys to add interesting facts to your WOM stories.
SPIKE SAYS: WORTHLESS – this is just a tiny add-on.

28. Let your customers create — provide ways to make it easy for consumers to customize and show off their creativity.
SPIKE SAYS: WORTHY

29. Use ‘free or low-charge’ release services to announce new products and services like Soflow, 24-7 PR, PR Leap, PR Free.
SPIKE SAYS: WORTHLESS – this is cheep PR, not WOM.

30. Let your evangelists know you’re listening. (Comment on their blogs, invite them to webinars or to your office for a VIP Tour and to meet the product or service teams, schedule meet-ups in cities and invite your customers to attend).
SPIKE SAYS: WORTHY

31. Measure results, not actions.
SPIKE SAYS: WORTHY – a lot of WOMM is touchy-feely, which is important, but we’re also here to drive sales.

32. Put the right tools in the hands of your most influential consumers to help them tell your story.
SPIKE SAYS: WORTHY

33. Bring your most loyal customers on the inside by involving them in your product development or marketing initiatives.
SPIKE SAYS: WORTHY

34. Poll your sales force for good closing stories, then edit and distribute to use as testimonials.
SPIKE SAYS: WORTHLESS as far as WOM goes, but a good idea.

35. Create a customer community of your most loyal customers.
SPIKE SAYS: WORTHY

36. If you’re going to give something away for free, focus on quality merchandise that influencers value and seed it in the places they naturally frequent.
SPIKE SAYS: Barely WORTHY

37. Set the table for WOM to occur by giving your customers tools to initiate it.
SPIKE SAYS: WORTHY

38. Join in the conversation (and start one if needed).
SPIKE SAYS: WORTHY

39. Tap into people’s sociability to propel WOM.
SPIKE SAYS: WORTHY, but how?

40. Identify “portable conversations” to give your advocates something to talk about.
SPIKE SAYS: WORTHLESS

41. Use the Buddy System and partner with your evangelists to work together on bigger projects.
SPIKE SAYS: WORTHY, but I think this same idea is listed above?!?

42. Partner with evangelists and create opportunities for them to sing your praises.
SPIKE SAYS: WORTHY

43. Print referral cards which customers can give to their friends.
SPIKE SAYS: Borderline WORTHLESS



June 26, 2006

TRIBAL KNOWLEDGE North American Tour

Tribalknowledgea_2
Coinciding with the publication of TRIBAL KNOWLEDGE in the early fall, I’ll be crisscrossing North America visiting with Business Associations and Marketing Associations. During these visits I’ll be delivering a thirty-minute version of my Starbucks Tribal Knowledge presentation which shares business and marketing lessons I learned first-hand on how Starbucks found prosperity from selling a commodity. (View sample PowerPoint slides here.)

I have some holes in my speaking schedule and would like to add your city to my “North American TRIBAL KNOWLEDGE Tour.”

If you would like to have me speak at an upcoming Marketing, Advertising, Public Relations, and or Business Association breakfast or luncheon . . . your organization will only need to cover transportation costs (from Austin, TX) and hotel expenses (if necessary). And if I have an open date on my schedule, then we’ll make this happen.

This opportunity is reserved for non-profit Business and Marketing Associations. However, if your for-profit business would like to have me speak, we can arrange this for an appropriate fee.

Tribalknowledgeb

June 22, 2006

Chrysler’s Addiction to Discounting

Last summer I introduced the Brand Autopsy Discount Detox Center in response to the Employee Discounts for Every One (EDEO) epidemic wrecking havoc on the automaker industry. I even shared Brand Autopsy’s proprietary Marketing Intervention Guidelines to be used by empathetic marketers wanting to reach out and help their fellow marketers inflicted with the EDEO disease. The Center for Marketing Disease Control & Prevention did manage to contain the EDEO Epidemic. But that was then and this is now.

Now, we hear Chrysler is jonesin’ to reduce its bloated inventory of cars and is getting back on the juice. Yes … sadly Chrysler is using again.

Chryslerdiscountaddiction_1

Advertising Age is reporting that early next month, Chrysler will begin offering prospective customers the same discounts their employees enjoy. The Circle of Addiction continues!

It pains me again to see a business return to using addictive discounting tactics to drive short-term sales. As a marketing doctor with Brand Autopsy, I’ve seen far too many businesses overdose on discounting. And once these businesses OD on discounts … they never seem to recover and regain the marketing vitality they once enjoyed.

I am begging readers of the Brand Autopsy blog to show tough love and confront this matter head-on. If you know anyone in the DaimlerChrysler Marketing Department, I hope you feel it in your heart to conduct a Marketing Intervention NOW . . . while we still have time. You can read the complete Brand Autopsy Marketing Intervention Guidelines here but the basic guidelines are posted below. Let’s work together to save our fellow marketers from the hellfire that awaits when discount addiction overcomes a marketer.


While it is best to use a trained marketing interventionist to help you develop the intervention strategy, you can conduct the intervention yourself. The following Marketing Intervention Guidelines from the Brand Autopsy Discount Detox Center will help you design and conduct your intervention.

  • Bring together a minimum of three and maximum of eight people who are important to the business and to the marketer in particular. The best marketing intervention groups have a broad mix of people including some from outside the company such as customers and vendors.

  • Set up a planning meeting with all participants to discuss the intervention. Be very discreet in all your actions so as not to alert the suffering marketer.

  • Each group member is to write a letter to the addicted marketer listing how they may have helped to enable the addiction and all the negative consequences caused by the marketer’s addiction. Each letter should close with a statement asking the marketer to seek treatment for their addiction.

  • Rehearse the intervention with all the group members. And at this meeting, set a date, time, and place for the actual intervention to occur. You will also need to create a plan to bring the addicted marketer to the intervention as well as choose a treatment center. If the chosen treatment center is out-of-town, then you will need to make necessary travel arrangements.

  • The intervention group will need to identify objections the addicted marketer may use to avoid or postpone treatment and then formulate appropriate responses.

  • Plan to be at the intervention location 30 minutes before the addicted marketer is expected to arrive.

  • At the intervention, confront the addicted marketer by reading your letters aloud, editing out anger, blame, and judgment. Read the best, most heartfelt and tender letter last. (Usually a letter from a concerned customer cracks any addicted marketer’s wall of denial.)

  • After the intervention, call the admissions staff at the chosen treatment center and let them know whether or not the addicted marketer has agreed to treatment.

  • Collect all letters and send them to the addicted marketer’s counselor at the treatment center.
  • Click here to read the following sample Marketing Intervention Letter (.pdf).
    Marketing_intervention_letter_1

    Starbucks Stops Selling Grani

    Grani_6

    Earlier this year, Brand Autopsy mentioned Starbucks had begun test marketing Kellogg’s Low-Fat Granola in 12 Indianapolis Starbucks locations. At the time I questioned the move not because Starbucks was selling granola, but that Starbucks was selling ho-hum Kellogg’s Low-Fat Granola.

    As a former Starbucks marketer, the litmus test had always been whatever we sold had to match the “best-in-class” quality of our coffee. Ain’t nuthin’ “best-in-class” about Kellogg’s Low-Fat Granola.

    I was also taken aback by how Ad Age reported this partnership by saying that Grani, the Starbuckian name for the cup of granola, could “… allow Starbucks to finally crack the code on a signature hot breakfast item and lift check average to boot.”

    Now Ad Age has reported that Starbucks is not pursuing “… additional testing after ending its operations test of Grani.”

    Grani is gone. I’m not surprised, are you?

    Hire Jason Wheeler

    Jason, from the Marketing is my Middle Name blog, is looking for a marketing job. So what does he do? He’s gone the regular resume route but he’s also going the irregular resume route …

    RSS Readers click here to view Jason's video resume.

    Customer Disservice from AOL

    From Mike Landman … by way of the always interesting Consumerist blog … we learn how not to deliver customer service from AOL.

    All someone wanted to do was cancel his AOL account but the AOL Customer Disservice Rep road-blocked him all the way turning a simple request into an excruciating exercise. Lucky for us, this conversation was taped and we all get to learn from this worst practice.


    Click here to listen.
    It’s interesting to note that last year AOL received over 3.0 million subscriber cancellation requests and in the first three months of 2006, AOL lost another 835,000 subscribers. Which leads me to believe one out of every three calls to AOL Customer Service must involve a cancellation request. (Ouch.) So yeah , AOL Customer Service Reps must be tired of answering cancellation calls. But … that doesn’t mean they should do their best Gerry Spence impersonation and make a case to dissuade a customer from cancelling.

    It’s also interesting to note that at its peak, AOL had 35 million subscribers … but today, has around 18.6 million subscribers. (Double Ouch.)

    Moviemakers or Movie Marketers?

    Really smart chatter has been happening from my Arresting Slumping Box Office Sales post with many comments echoing some of the sentiments expressed in a vintage Brand Autopsy posting.

    In that post from last summer, I riffed off two articles that were exploring where to place blame for a dismal summer 2005 movie season. Were slumping sales the fault of moviemakers or movie marketers? As you can read below, I found blame with the moviemakers …


    [From the Brand Autopsy archive (August 20, 2005)]

    Who’s to blame for the dismal summer movie season … moviemakers or movie marketers? Year-to-date box office sales are half-a-billion dollars less than last year and there is a lot of finger-pointing going on in Hollywood.

    Moviemakers are blaming marketers for the box-office slump. They say Hollywood marketers have abused the heavy-up television advertising tactic to the extent audiences have grown tired of the relentless hype machine.

    Movie marketers are blaming changing consumer habits. They say their core consumer (12 to 34 year olds) are spending more time playing videogames, surfing the internet, and using their cell phones than going to the movies.

    Movie theater owners are even getting to the action by blaming moviemakers. Theater owners are say this year’s movies are just not as good as last year’s movies.

    I side with the movie theater owners and place the blame on the moviemakers.

    If moviemakers make truly remarkable films, people will remark about them and audiences will flock to see them. Case in point … CRASH, a remarkable movie people remarked about this summer. I saw it because my sister-in-law remarked to me how much I would like the film because it depicts an honest look at racial relations.

    So … who do you think is to blame for the summer box office slump? Moviemakers or movie marketers?



    June 20, 2006

    Arresting Slumping Box Office Sales

    In Monday’s Wall Street Journal TECHNOLOGY Report, movie director Barry Sonnenfeld shared an interesting idea to address a movie’s week-after-week decline in box office sales. [SOURCE LINK (sub. req’d)]

    These days a movie’s first week is its biggest sales week. Box office sales in the second week of a movie’s opening are about half of what the movie did in its first week. And sales in its third week are about half of a movie’s second week sales take. For example, CARS opened last week with box office sales of $60.1 million. In its second sales week, CARS took in $33.7 million which is about half of its opening week sales. So next week … CARS will probably take in about $17.0 million.

    To arrest the week-after-week sales decline movies experience, Barry Sonnenfeld offers the idea of releasing a special edit of a film with extra scenes to goose sales during week four of a movie’s release. Digital editing and digital distribution of movie prints makes this idea financially feasible from a cost standpoint. Sonnenfeld is realistic though and rightly tempers his expectations, “No one's going to come back to see RV again, with 10 minutes of new stuff, but you would if it was STAR WARS or KING KONG.”

    Ya know … this marketer thinks Barry Sonnenfeld might be onto something here. We’re already buying DVDs of our favorite movies with additional scenes and alternative endings. Why wouldn’t we also be apt to buying tickets to see a movie that has extra scenes and other cinematic doo-dads a few weeks after a film’s initial release. Interesting idea, eh?

    June 16, 2006

    Fiskars Crafting Ambassadors

    While visiting with the Brains on Fire crew, they shared with me some work they're doing with Fiskars. I’ve only known Fiskars as a maker of scissors. But Fiskars is much more than a scissor maker. They are deep into the whole scrapbooking thing.

    Did you know scrapbooking is a THREE BILLION DOLLAR business? (I didn’t.) Seems all the patterned paper, ribbons, scissors, fabrics, and embellishments add up to being a HUGE business. (Give this marketer a break for being scrapbook business ignorant. I’m a guy after all. Thanks.)

    Anyway … Brains on Fire has helped Fiskars to identify some of its customer evangelists and in turn, crafted a Fiskars Brand Ambassador program cutely named, “Fiskateers.” Not only can other Fiskars evangelists become Fiskateers, they can also participate in a Fiskateers blog.

    Fiskateers

    On the just-launched blog, four Fiskateers are actively blogging and sharing their love for all things scrapbooking. Recent posts include Father’s Day book ideas and “get-well” love from Fiskars Sisters.

    This Fiskateers Brand Ambassador program is a customer evangelism case study-in-the-making. Nice work Brains! And kudos to Fiskars for embracing customer evangelism.

    F.I.R.E.’d Up

    My travels this week took me to Greenville, South Carolina where I connected with kindred spirits at Brains on Fire (BoF). Robbin, Spike, Virginia, and Geno (shown below) are just a few of the brains from BoF.

    Brains_and_me

    BoF is a whiz-bang marketing services company that lives by the credo of: Fascinate. Inspire. Reward. Engage. I spent a full day hanging out with the BoF crew and they shared with me some of their recent work which I found fascinating, inspiring, rewarding, and engaging.

    Dig around the Brains on Fire blog and you might just get F.I.R.E.’d up too. I’ve already done some diggin’ for ya…

    Robbin >> Hiring is Tiring
    Spike >> Campaigns vs. Movements
    Virginia >> Bringing Back Bandit
    Geno >> I Still Have Hope

    June 13, 2006

    TRIBAL KNOWLEDGE | Book Update

    The manuscript is baked. Blurbs are being solicited. Galley copies are being printed. The tribalknowledge.biz website is being created. All and all — lots of activity going on as Kaplan Publishing is busily prepping TRIBAL KNOWLEDGE for a Sept. 1st publication date.

    Over the next few months, I plan to share more tidbits about the book including excerpts and insider commentary. Don’t expect TRIBAL KNOWLEDGE to be a heavy-handed pedantic-rich business book distilling tired and trite platitudes about Starbucks’ business success.

    Instead, TRIBAL KNOWLEDGE has been written to be a breezy business book sharing ideals to spark ideas with entrepreneurs, small business owners, and marketers. Basically, this book shares business and marketing lessons I learned while spending nearly a decade working deep inside the Starbucks marketing department. Some of these lessons include: Bake Marketing into Your Business ; Strong Brands Always Have More Brand Credits Than Debits ; Only Three Strategies Exist to Drive Sales ; and Participation Is the Price of Admission.

    As a TRIBAL KNOWLEDGE teaser … you can download and read the Introduction chapter (pdf file).

    Oh yeah, I’d be remiss if I didn’t mention you can pre-order the book at Amazon or Barnes & Noble.

    June 10, 2006

    I Don’t Want My GSTV

    Gstv_1

    That’s a picture of the latest brilliant marketing idea – showing television commercials to people pumping gas. Gas Station TV has been testing this marketing idea in Dallas and is expanding the test to more markets with an eye towards having 1,000 gas stations in 21 states by next year. Airing on GSTV will be 15-second commercials as well as news/entertainment content from the ABC television network.

    This marketing venture is doomed to fail because GSTV is working under the decaying marketing premise that awareness is the end game for marketers. I don’t think David Leider, GSTV CEO gets IT as evidence by this quote, "This is a truly captive audience that we have--those stuck at the pump--and this is a great opportunity to engage them." [SOURCE]

    I’m reminded of a quote from David Polinchock of the Brand Experience Lab where he once said that consumers don’t like to be captive; however, they do like to be captivated.

    The message for marketers is simple: Design marketing activities to be captivating to audiences and not to design marketing activities to hold audiences captive. Captivated – YES!!! Captive – NO!

    But this decaying marketing mindset seems prevalent at GSTV. Adam Bleibtreu, GSTV President, is quoted in the June 5th issue of Ad Age saying, “We’ve taken the television set from your living room and put it in the gas station.”

    Yo Adam … why would I, as a consumer, want you to take the television from my living room and put it in a gas station? Seriously, why? What I do want at every gas station is a hand sanitizer dispenser on every pump. Not a TV screen. Dig?

    Takeaways from the Innovative Marketing Conference

    Over at the Fast Company blog, there is extensive coverage, 35 posts in total, of the recently held Innovative Marketing Conference. If you are more into the podcast thang, Shel Holz and Neville Hobson recorded a slew of interviews with smart marketers. Plus, there are images galore over on Flickr. So I’ll do my best to refrain from adding clutter and instead, peppering the already existing chatter with a few knowledge nuggets and observations.


    Deepak Advani is the CMO at Lenovo and he delivered the morning keynote for Day 2. (Lenovo??? That’s the Chinese-born company that purchased IBM’s PC business in December 2004.) Anyway, he gave an interesting case-study look into how Lenovo is strengthening and positioning the ThinkPad product brand to build the Lenovo master brand.

    While much of the presentation seemed to be a sales pitch for Lenovo the company, Deepak talked about how the importance of first communicating the brand and then the importance of delivering upon the communicated brand. He used this super-simple chart to illustrate his thoughts:

    Communicatedeliverthebrand

    At the end of his presentation, Deepak shared with us the viral video tactics Lenovo was doing to communicate the brand. But something didn’t smell right for me or with Rob Leavitt. Rob sums up my feelings by writing this on the FC Now Blogjam:

    ”One sour note, though: one of the more "clever" viral initiatives, creating an allegedly independent site with "smuggled videotapes" from the Lenovo research lab, definitely fails the smell test. It's a cool little site, and apparently generated great traffic, but this sort of manipulative technique is only negative in the longer run.”

    While Lenovo’s viral video tactics smell untrue, Deepak clued us in on a very high-touch viral tactic that Levono’s employees are doing which smells very true. Many Lenovo employees will carry around a supply of red track balls. And when they see someone using a ThinkPad computer, they’ll introduce themselves and give them a new red track ball to replace their worn-out track ball. A simple, yet meaningful way to connect with customer.


    Panelists during the Models for Innovation: Creating New Products and Services that Work session talked a lot about how to gain actionable and forward-thinking insights from customers. Tony Ulwick, Strategyn CEO and biz book author, shared this statement, of which, I’m still chewing on …

    ”Unarticulated needs [from customers] are not existent. However, unarticulated solutions do exist.” Tony Ulwick

    The New Toolbox for Marketers session was lively and informative thanks to the super-smart panelists and to Johnnie Moore’s facilitation skills. Throughout this session, panelists and attendees discussed the changing times for marketers as either an evolution or a revolution. Diane Hessan, CEO at Communispace, managed to brilliantly sum-up the current state of marketing by saying …
    ”The revolution is that consumers are more in control. The evolution is how consumers will use their control.” Diane Hessan

    Lois Kelley goaded Larry Weber, long-time PR big-wig, into ranting about all things advertising/marketing related during The Changing Face of the Marketing Department session. Larry dropped lots of HMOs (hot marketing opinions) throughout his thirty-minute rant.

    Some of his harshest comments were directed at Word-of-Mouth companies from BuzzMetrics to BzzAgent to the Word-of-Mouth Marketing Association (WOMMA). He chided BuzzMetrics for being the “snorkelers of the marketing ocean.” Basically, Larry believes BuzzMetrics doesn’t dive deep enough into its analysis and understanding of the WOM game. He also took swipes at BzzAgent by saying that any form of compensation automatically compromises the marketing activity. And he threw WOMMA under the WOM bus for associating itself with these businesses.

    So if Larry dislikes BzzAgent’s compensation system, then why did he blurb Dave Balter’s GRAPEVINE book? On the back cover of GRAPEVINE, a book which shares word-of-mouth learnings from BzzAgent campaigns, Larry Weber praises Balter (and BzzAgent) by saying GRAPEVINE is, “A thoughtful and timely read.”

    Cantankerous musings aside, Larry Weber made an astute observation on how marketers can learn a lot from gourmet chefs. Chefs must carefully select ingredients and methods to cook sensual, emotional, and experiential dishes. Marketers, too, must carefully design the strategies and select the tactics to prepare sensual, emotional, and experiential marketing programs.

    Moore and Moore

    Mooreandmoore_1

    Yep ... that's Johnnie Moore and me, John Moore, at the Innovation Marketing Conference. This photo marks the first time we've met face-to-face (as opposed to us meeting blog-to-blog). Moore to come on this as well as moore to come on some of my takeaways from the Conference.

    June 07, 2006

    Six Degrees of Marketing Organizations

    In the May 29 edition of Brandweek, Constantine von Hoffman shares findings from a Booz Allen Hamilton study which asked marketing executives about the structure/function of their marketing department within their overall company. After analyzing the responses, Booz Allen researchers identified that there are six types of marketing organizations.

    1 | Marketing Masters
    2 | Senior Counselors
    3 | Service Providers
    4 | Brand Builders
    5 | Best Practice Advisors
    6 | Growth Champions

    1 | Marketing Masters “… enjoy the authority to coordinate with other major business functions. They do not, however, make strategic decisions and seldom lead new-business development.” [Hmm … sounds just like the corporate Starbucks marketing department where, when I was there, marketers were project leaders coordinating/facilitating interaction between business units.]

    2 | Senior Counselors assist in guiding “… the CEO on marketing strategy and also serve as primary advisors on marketing strategy for individual businesses.” Rarely will these marketers lead product innovation initiatives, but they are responsible for leading major advertising and/or promotional campaigns.

    3 | Service Providers are the coordinators of “… advertising, promotion and public relations at the request of the company’s brand and product teams.”

    4 | Brand Builders provide “… marketing services like communications strategy, creative output and campaign execution of key brands, but their leadership role and decision rights on strategy and investment are all but negligible.” [The National Marketing Department at Whole Foods Market worked exactly this way when I was there. While we had virtually no say in the strategic direction of the company, we were responsible for developing and implementing marketing tactics.]

    5 | Best Practice Advisors work directly with “… individual business units to maximize marketing effectiveness and efficiency” by gathering and disseminating best practices within the company as it relates to advertising, promotion, and public relations.

    6 | Growth Champions lead their company’s efforts in product innovation and in new business development. They also are heavily involved in decisions pertaining to new-market penetration and strategic investments.

    Anyone else care to chime in on which type of marketing organization the one you work in works under?

    June 05, 2006

    TREASURE HUNT Treasures

    Treasure_hunt_1
    I recently finished reading TREASURE HUNT, the follow-up book to the best-selling TRADING UP. In TRADING UP, Michael Silverstein (along with Neil Fiske) profiled the reasons why consumers choose to pay a premium price for luxury goods/services. This time around in TREASURE HUNT, Silverstein (along with John Butman) profiles the middle market consumer and the reasons why they sometimes choose to trade-up and most times, deliberately trade-down to purchase less expensive goods. He also gives businesses advice on how they can better appeal to the middle-market consumer at both the high-end and the low-end of a market.

    There’s much to explore about the book over on the Treasure Hunt website with preview PDFs (synopsis & intro) and video snippets from the author. Below you’ll find elements of the book that I found worthwhile. As for the book itself … it is definitely a worthwhile read.


    Treasure Hunt
    The title of the book stems from Silverstein positing that consuming “… has become a treasure hunt—a constant search through the world’s incredibly vast and ever-changing store of goods and services, with the goal of finding the perfect value every time.” (pg. 5)
    Bifurcation Nation
    Silverstein contends consumer markets are bifurcating into two fast growing segments. “At the high end of the market, consumers are trading up, paying a premium for high-quality, emotionally rich, high-margin products and services. At the low end, consumers are relentlessly trading down, spending as little as possible to buy basic, low-cost goods that still deliver acceptable quality, reliability, and increasingly, elements of fashion and current design.”(p. 4)
    Trading-Up Market Size vs. Trading-Down Market Size
    Using Boston Consulting Group data, Silverstein projects the market size of the trading-up segment to be $535 billion in annual spending and the market size of the trading-down market is an astounding $1 trillion dollars a year.
    Market Capitalization Comparison (year 2004 figures)
    Market capitalization of the top ten trading-up companies: $55 billion.
    Market capitalization of the top ten trading-down companies: $476 billion.
    Biggest Trading-Up Categories
    The following categories typify areas consumers willingly spend more for:
    1 | Travel and Entertainment
    2 | Homes and Home Renovation
    3 | Cars
    4 | Restaurants/Dining Out
    5 | Home Goods
    6 | Food and Beverages
    Biggest Trading-Down Categories
    These are categories where consumers deliberately spend less for:
    1 | Homes and Home Renovation
    2 | Cars
    3 | Restaurants/Dining Out
    4 | Travel and Entertainment
    5 | Food and Beverages
    6 | Personal Services
    Reasons Why Middle Market Consumers Trade-Down
    1 | They are savvier than ever and take great pride in out-smarting companies by finding ways to get products/services at the lowest possible price.
    2 | They do not think there are meaningful functional differences between goods at two different price points.
    3 | They were taught by their parents that being thrifty is virtuous.
    4 | They do not believe in excessive consumption.
    “The Want List”
    Silverstein writes that middle-class consumers keep an ever-changing dream list of items they want. Because these consumers never earn the money to buy items on their want list, they will, many times, make trade offs by not buying a $7,000 Rolex and instead, settling for buying a $1,500 HDTV.

    For marketers, Silverstein makes a very astute observation, “If you can understand the want list of your consumers, you may discover that you are competing not only against other companies in your category, but also against completely different categories where consumers might spend their discretionary dollars.”(p. 56)


    The Trading Up Trap
    “Companies that pursue a trading-up strategy, for example, will usually make some incremental technical or functional improvements in their offering, and hope that the emotional value will soar. But they don’t or won’t, make a full commitment to the strategy. They won’t put enough cost in the product. They’ll rely too much on advertising to build the brand. They won’t listen well enough to consumers about what they like and dislike.” (p. 229)

    June 02, 2006

    Whole Foods Market on 60 MINUTES

    Consider this a heads-up. CBS will be airing a profile on John Mackey and Whole Foods Market during this Sunday’s (June 4, 2006) edition of 60 MINUTES.

    Wfmsixtyminutes


    For marketing insights into Whole Foods ... CLICK HERE.