Brand Autopsy

Jeff Bezos on Pricing Strategy

"There are two kinds of companies — those that work to raise prices and those that work to lower them." Jeff Bezos, founder & ceo of AmazonMucho kudos to Todd Sattersten for the quote.

Great Brands Inspire Customers

The Wall Street Journal recently ran a profile on Restoration Hardware and its reemergence as a great brand. Much of the article centered around the design and management style of Gary Friedman, Restoration Hardware ceo and chairman.

“Great brands don’t chase customers, customers chase great brands.” - Gary Friedman

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The above quote was pulled from Gary explaining how Restoration Hardware, during the recession, resisted playing the low-price value game and instead, doubled-down its efforts to improve the company’s identity and uniqueness. Gary went on to say, “In bad economic times, quality becomes even more important, uniqueness becomes even more important—people need to be inspired to buy something.”

Gary’s right.

Just like people need to be inspired to talk about brands... people also need to be inspired to buy something from brands.

What are you doing to inspire customers to buy something?

Bringing Sexy Back to Offline WOM

[image designed by the kiddos at Brains on Fire]

At the 2011 WOMMA School of WOM Conference, Geno Church and I gave a presentation titled, “Bringing SEXY Back to Offline Word of Mouth.” It was less a presentation and more a RANT about the importance of not losing focus on real world marketing ideas that can spark customer-driven conversations.

Unfortunately, it’s become decidedly unsexy to talk about anything word of mouth marketing-related that doesn’t involve Facebook, Twitter, Foursquare, or scores of other social media thingamajigs.

Geno and I went true school by sharing strategies and ideas for how businesses can spark conversations with customers all day every day in the offline REAL world. (For all those social media experts and practitioners who steadfastly contend social media solves every marketing problem, keep in perspective that 93% of retail sales in America happen offline.)

The following 425 words express some of the key points I made during my 15-minute RANT at the school of WOM. (These words first appeared in a recent CrackerJack Marketer newsletter. Missed it? Rectify it.)

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Touchpoints as Talking Points

The best word of mouth isn’t a marketing tactic. It isn’t a tweet, a status update, a viral video, or anything else you can find or do on a social media website. The best word of mouth isn’t a publicity stunt or anything done to get some buzz for a day. The best word of mouth is how a business does business not just one day, but every day it is in business.

The word BUZZ needs to be eliminated from our vocabulary. Buzz is exclamation point marketing. It’s a one hit wonder. It’s one and done. Big bang one day, nothing the next day. Too many marketers are relying on the Big Bang Theory to get people talking.

And too many marketers are living for The DOT and not The LINE.

The DOT being a “One Day Big Bang” approach to getting people talking. The LINE being an “All Day Every Day” way to becoming a talkable brand.

The average life expectancy of a Fortune 500 business is 14,600 days and the average life span of a small business is 3,100 days. Clearly, a business is not in business for just one day; it is in business for a series of days — a line.

As marketers, it’s our responsibility to give consumers reasons to talk about brands, products, and services not just for one day... but rather, for a series of days.

To create a talkable brand, we must earn opinions from customers at every touchpoint. Anything a customer can see, hear, touch, taste, and smell is a touchpoint. Customer touchpoints are EVERYWHERE which means word of mouth opportunities are everywhere.

For example, any restaurant that uses a “Please Wait To Be Seated” sign from a restaurant supply catalog has given up on being talkable. This sign is one of the first customer touchpoints someone will experience inside a restaurant. It’s the perfect opportunity to showcase a company’s unique personality by creating a custom sign that expresses the uniqueness of the restaurant.

Starbucks has long practiced the idea of giving people reasons to talk by earning opinions from customers at every touchpoint. One of the simplest ways Starbucks earns opinions from customers is by deliberating calling their drink sizes Short, Tall, Grande, and Venti. The easiest (and least talkable) decision would be to use Small, Medium, Large, and Extra Large as their drink sizes. But there’s nothing interesting in the mundane.

The most talkable brands take common customer touchpoints and make them uncommon... uncommonly talkable. What touchpoints can your business make interesting to get customers interested?

The Blessing of Simplicity

I recently happened upon a social media tip from an obviously knowledgeable person. Problem was, he had too much knowledge. “Too much knowledge, how could that be bad?,” you ask.

Too much knowledge becomes bad when it becomes a curse that prevents smart people from sharing smart advice that less knowledgeable people can understand. Case in point, this social media tip found online:

"Use the friendship paradox to identify the social brokers at opaque target markets. Identifying people closer to the center of the social graph delivers higher ROI when evangelizing.” [name withheld to protect the guilty]

Obviously, this social media expert has lots of knowledge. He unfortunately suffers from the "Curse of Knowledge."

Chip and Dan Heath wrote about the Curse of Knowledge in MADE TO STICK. Here’s how they explained it,

“Here’s the great cruelty of the Curse of Knowledge: The better we get at generating great ideas—new insights and novel solutions—in our field of expertise, the more unnatural it becomes for us to communicate those ideas clearly. That’s why knowledge is a curse. But notice we said ‘unnatural,’ not ‘impossible.’ Experts just need to devote a little time to applying the basic principles of stickiness.”

The antidote to the “Curse of Knowledge” is the Blessing of Simplicity. Using simple, easy-to-understand words will make you look smarter because you’ve communicated your complex advice in an easy-to-digest way.

Don’t confuse simple words with dumbing something down. It’s actually harder to use simple, jargon-free words than it is to use supposedly smart and knowledgeable words.

For example, here’s another social media tip I found online that probably says the same thing the “friendship paradox” quote was trying to say,

“Remember that this is social. Don’t approach it as an opportunity to sell, sell, sell. It’s about building relationships and trust – things that take time and come from reliable and repeatable actions. Treat social media just as you would a social function in real life.” [name withheld to not make the guilty guy look guiltier]

Ahh ... much easier to understand.

What Ries Doesn’t Get About Execution

The Brand Autopsy Archive Project
1,400 posts since December of 2003. That’s a lot of HMOs (hot marketing opinions) served up on the Brand Autopsy blog. For this week, we’re going to revisit five vintage posts from the Brand Autopsy Archives. Enjoy...

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BACKSTORY | March 29, 2011
I’m a big fan of Al Ries. He co-wrote POSITIONING with Jack Trout in 1980 and its become a bedrock marketing strategy book. His recent Ad Age articles about branding in the today’s social media world and the dangers of discounting are spot-on. However, I disagreed with Al’s article from March 7, 2005 saying, “Marketing is 90% strategy and 10% execution.” The following post explains the importance of execution in making retail magic happen.

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Originally posted on March 8, 2005

There’s been some blog chatter on Al Ries’ latest Ad Age article, “What CEOs Just Don’t Get About Marketing.”

I think Ries’ penchant for hyperbole is overshadowing the crux of his argument that good execution of a bad marketing strategy will not deliver exceptional results.

However, I can’t blame anyone for jumping all over him when he writes such blanketed statements like, “Marketing is 90% strategy and 10% execution. With the right name, the right target audience, the right position and the right timing, most marketing programs are bound to work. The difficult part is the 90%. The easy part is the 10%.”

Has Ries undervalued the importance of people (employees) executing a marketing program? Oh yes ... he has grossly undervalued the importance of people making marketing happen.

I just don’t buy his argument that most marketing programs are bound to work if the right name, right audience, right positioning, and right timing are in all place. I also disagree with his statement that the easiest part to a marketing program is the execution.

My experience at Starbucks Coffee and Whole Foods Market tells me marketing is more like 35% strategy and 65% execution. A so-so marketing strategy can deliver exceptional results if those responsible for executing it are informed and inspired to make retail magic happen. The real trick is how best to solve for informing and inspiring customer-facing employees to make retail magic happen.

Brand Examiner Paul and I wrote about one such way we solved for informing and inspiring Starbucks partners to make retail magic happen in a Fast Company blog posting from December of 2003. Click here to read about Blended Beverage Bingo.

So … from your experience, what % of marketing is strategy and what % is execution? Is it 90/10 or is it more 35/65?

Super Simple Social Media Policy

I am not a social media marketing expert. I’m a retail marketer who believes in using really good marketing to connect with customers. That explained, I heard some great advice on creating a super simple Social Media Policy while attending the Blogwell Austin event on Feb. 2.

Andy Sernovitz, CEO at the Social Media Business Council, reminded us of the juvenile sexual innuendo joke where you add “... in bed” at the end of a fortune cookie saying. For example...

That’s funny. It’s also a useful idea, says Andy, to borrow when writing up a company Social Media Policy.

Most businesses, especially big businesses, have corporate conduct guidelines explaining how to behave when on the job. Most, if not all, of these guidelines can be used as the basis for a super simple Social Media Policy. All one has to do is add “... online” at the end of each conduct guideline statement. For example...

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Of course, adding “... online” to a company’s existing corporate conduct guideline policy does not cover everything a business needs to concern itself with when designing its Social Media Policy. However, it probably covers most things.

For a much deeper dive into designing a Social Media Policy check out WOMMA’s resources and the resources from SocialMedia.org.

Business Wisdom from Drug Dealers

I recently gave a VSOP ... Very Special One-time Performance ... at the ProductCamp 6 event in Austin, TX.

ProductCamp, like its BarCamp relative, is an unconference gathering of marketers, mainly product marketers, who network and learn from each other. It's a free event but the price of admission is participation by either leading a session, talking shop with others, and or volunteering to make the event run smoothly. I highly recommend you learning more about ProductCamp and definitely participating in one happening near you.

My VSOP for ProductCamp was titled, BUSINESS WISDOM FROM DRUG DEALERS. Long-time Brand Autopsy readers know this is territory I've covered before. Fans of 37signals know its founders recommend emulating drug dealers to find business success. While the topic is oddball, the lessons to be learned from street corner sellers are practical.

No video was taken of my presentation. However, you can re-live this talk by watching the following reenactment. (To recreate this prezo, I recorded one-take audio of me giving color commentary to the slides and to the transitions for the previously recorded video ditties shown during the prezo. Click play and all will make sense.)

BUSINESS WISDOM FROM DRUG DEALERS

>> Direct link to the video

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SESSION DESCRIPTION:
Business Wisdom from Drug Dealers
Before you dismiss this as outlandish and ridiculous – think for a second. To build a successful venture, drug dealers must design their business and develop their products in the same ways legitimate businesses do. Drug dealers, like marketers, must address issues ranging from Launching New Products to Customer Acquisition Strategies to Brand Dilution to Procurement. In this session, you'll learn vital and actionable marketing insights from a most unlikely source, drug dealers.

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PRESENTER BIO:
John Moore is a former "drug" dealer. For eight years he worked as a retail marketer with Starbucks Coffee selling an addictive drug, caffeine. These days, John leads Brand Autopsy, a marketing firm that consults with businesses aspiring to become a beloved brand. USA Today, Best Buy, Kraft, Little Caesars, and the Word of Mouth Marketing Association have all benefitted from John's past experience as a "drug" dealer.

Jack Welch on Competitive Advantage

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"If you don't have a competitive advantage, don't compete." -- Jack Welch

Really Good Marketing

Why are we complicating the game of marketing by creating distinctions like social media marketing, content marketing, and shopper marketing?

Tactically, things have changed because of technology and consumer cynicism. Fundamentally, though, nothing has changed in the game of endearing a brand/product to a person.

Really good marketing is, was, and will continue to be about getting the right message to the right person at the right time in the right way(s) to deliver the right results.

Really good marketing is Ford using social media to create awareness and preference for the Ford Fiesta.

Really good marketing is Eloqua sharing relevant information with B2B businesses on how to do business better.

Really good marketing is Costco sampling goodies to in-store shoppers to increase sales.

No matter the tactics and tools we use, really good marketing is just that ... really good marketing.

Right?

2010 Novel Piece Prize for Business Strategy Luminance

The NOVEL PIECE PRIZE award recognizes excellence in business book writing. The first recipient was Youngme Moon. The second recipient is celebrated below...

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Why do service firms ranging from ad agencies to consulting businesses to creative professionals succumb to the pitch process of giving away free ideas in order to win new business? This year's recipient of the Novel Piece Prize in Business Strategy Luminance answers that question as well as provides a framework for all types of businesses to use in order to profitably gain new business and new customers in the book, THE WIN WITHOUT PITCHING MANIFESTO.

Blair Enns, business development advisor to marketing communication firms, believes creative professionals have become addicted to the frenzied adrenaline rush of the pitch presentation. According to Enns, this is counter-productive to beginning working relationships with clients because "at a time when we should be conversing, we are instead cloistered away preparing for the one-way conversation called the presentation."

Writing in THE WIN WITHOUT PITCHING MANIFESTO, Enns derides the practice of service firms giving away free ideas in proposals and presentations to prospective clients as flawed. He equates such an arrangement to that of a doctor and a patient. "A client," writes Enns, "asking for unpaid ideas in a written proposal is like a patient asking for diagnosis and prescription from a doctor he refuses to pay."

Enns contends clients, in many instances, come to service firms with self-diagnosed problems and with surgical procedures already identified to help restore their business health. Unfortunately, Enns says, "[service firms] are far more likely to proceed with such a flawed approach than any medical practitioner." Enns urges services firms to "view the act of prescription without diagnosis for what it is: malpractice."

To orbit the new business pitch process hairball, Enns instructs service firms to develop a "Deep Expertise" by making "The Difficult Business Decision" of choosing a tightly-focused specialty. From there, firms must "articulate that focus via a claim of expertise" and "work to quickly add proof" to the claim. Then, service firms must diligently work to achieve a "true thought leadership position" and use its earned expertise to "trigger in the client the idea that perhaps his performance in a certain area could be improved."

Enns readily admits it isn't always possible to derail the pitch process. In those situations, Enns advises service firms to "gain the inside track" because the "default assumption should be that somebody always has the inside track." According to Enns' strong position, if a service firm cannot derail the pitch process nor gain the inside track, the firm should walk away from the potential business.

The most widely applicable business lesson from THE WIN WITHOUT PITCHING MANIFESTO involves pricing power. Undifferentiated services firms, like undifferentiated products, have no pricing power because abundant alternatives exist. The simple business rule is: the more crowded a market, the more likely low price becomes the differentiator.

According to Enns, "winning while charging more is the ultimate benefit of effective positioning." The more selective a firm is in what they do (positioning), whom they sell to (prospective clients/customers), and how they deliver services (proof of expertise), the greater pricing power a firm will enjoy.

Please join me in celebrating the work of Blair Enns as the recipient of the Novel Piece Prize in Business Strategy Luminance for 2010.

Walt Disney on Business Success

A huge hat tip to Drew McLellan for finding and sharing this tasty nugget of business wisdom from Walt Disney...

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"Do what you do so well that they will want to see it again and bring their friends." - Walt Disney

The Sound of Silence

Silence can be heard. It was heard at the Word of Mouth Marketing Summit 2010 when Davia Nelson and Nikki Silva, known better together as NPR's The Kitchen Sisters, gave a presentation on the Art of Storytelling.

About halfway through their talk, Davia & Nikki stopped talking. People in the audience also stopped. They stopped fiddling with their iPhones and laptops but they didn't stop listening to the silence. Instead, people started listening with their eyes as they focused on Davia & Nikki on stage.

After a good thirty-seconds of silence and with every eye in the audience focused towards the stage, Davia said, "Silence brings people together." (It sure did.)

Sam Harrison, writing in his book, ideaSELLING, sells us on using silence when presenting and pitching to clients. After sharing a pitch to a client, Sam says we should, "Listen up. Be quiet and wait for the decision maker to speak. If there's a pause, resist the urge to fill the void. Stay silent and listen. You're about to hear something important. Maybe you'll get the go-ahead. Or you'll hear the objection or obstacle you must address to gain approvals."

After years of blowing his trumpet and filling space with sounds, Miles Davis learned to play silent notes. He learned silence could be just as loud as sounds from his horn. "Don't play what's there, play what's not there," is the music maxim Miles followed and it's a communication maxim you can follow.

Retail Reality

Thanksgiving was yesterday. Black Friday is today. Cyber Monday is around the corner. It's official, the 2010 holiday retail shopping season has begun.

Here's a shopping statistic that will surprise most of us, especially those of us whose world revolves around everything online from social media to social shopping.

93% of all US retail sales occur in the real world.

Ninety-Three Percent.

Which, of course, means, only 7% of US retail sales occur online in the digital world.

Yes. The shopping trends clearly reveal online sales are growing in importance. But what is important today and important for the foreseeable future is offline sales occurring in a physical store.

This marketing wake-up call statisitic comes from Forrester Research ...

Words Matter when Marketing Yourself

Your resume is your personal sales sheet. It lists your experience and expertise. It should also excite a potential employer to schedule an interview with you. According to Karen Burns, your resume shouldn't contain tired and trite buzzwords that look professional but read comical.

Karen lists 50 buzzwords to avoid when marketing yourself on a resume because they will "make your resume look like everyone else's" and "they're probably not among the keywords employers search for."

Buzzwords Karen advises us to avoid include:

• Team player
• Detailed-oriented
• Strong negotiation skills
• Results-oriented professional
• Strong work ethic
• Results-focused
• Proven ability
• Motivated

Consider applying the same thinking to the word choices you use in any marketing materials designed to drive awareness and preference with customers. Drop the tired and trite words for those with personality and punch.

Perhaps a visit to Unsuck-It is needed to improve your personal sales sheet and your company's marketing materials.

Sampling (with a Story) Sold Me

I'm not someone who buys Cheddar Snaps. Yeah, I like the taste of these baked cheese wafers but they are never on my shopping list. However, I bought a bag of Texas Cheddar Snaps the other day. They weren't on my list but they ended up on my lips.

As I was heading to the beer aisle while shopping, an elderly lady stopped me and quietly asked, "Would you like to sample a Cheddar Snap?" Usually I would politely pass. This time I couldn't refuse the offer. She looked like anyone's Grandma and how can anyone turn down Grandma? I couldn't.

Before I snapped into a Cheddar Snap, I asked her if she liked them. Grandma replied, "I'd better. They're my recipe."

With that, Grandma had me ... I was in.

I snapped into the Cheddar Snap. And as I started chewing, she rattled off the wave of flavors my taste buds were experiencing from the type of cheddar cheese to the pecan flavor to the spicy kick at the end. She went on to tell me she's been making these Cheddar Snaps for fifty-plus years.

After that, Grandma had sold me ... I bought a bag.

We all know sampling can sell a product. What we forget is a customer also needs to sample a story when they sample a product. Grandma sold me some Cheddar Snaps when she told me a story.

Advertising and Word of Mouth

As part of my project work with The Keller Fay Group, I'm digging into their archive of research findings and providing insights, which marketers can use to better tap into the power of word of mouth.

Keller Fay recently released new data showing the virtues of advertising on Television, in Magazines, and Online to spark word of mouth conversations. The data shows how TV, Print, and the Internet all work differently when it comes to sparking word of mouth conversations about brands, products, and services.

The following presentations explaining the virtues of advertising to trigger word of mouth first appeared on the Keller Fay WOM MATTERS blog. If you're interested in learning more about how advertising can spark word of mouth, read and watch below.

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Television
While overall television viewership is down, that doesn't, by any means, diminish the impact television advertising has on sparking word of mouth conversations.
LEARN MORE below:

Word of Mouth Virtues | Television Advertising

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Magazines
Advertising in print magazines will help a brand reach consumers who are more inclined to be talkative influencers, those folks who actively and passionately keep up with what's new and interesting in the world and share it within their large social circle of friends.
LEARN MORE below:

Word of Mouth Virtues | Magazine Advertising

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Online
Online media triggers about 15% of all brand-related word of mouth conversations. That's a higher percentage than print media, radio, and billboard. Only television is a bigger trigger of word of mouth, but not by much.
LEARN MORE below:

Word of Mouth Virtues | Online Media

Advertising versus Advocating

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“People may talk about a brilliant advertising campaign, but they will never advocate an ad the way they advocate a product they love." --Douglas Rushkoff

The Macro Appeal of microMARKETING

As a social media marketer with Powered, Greg Verdino recommends "micromarketing" strategies to clients. In his book, microMARKETING, Greg shares with all of us his thinking behind why marketers need to shift our actions from mass to micro in order to realize the benefits of "tapping into the power of the few to reach to the many" through using social media.

To help promote his book, Greg is "tapping into the power of the few to reach to the many" by having 20 or so bloggers post chapter-by-chapter reviews. (More details here.) I'm reviewing chapter 9, From the One Big Thing to the Right Small Things.

To illustrate this point, Greg tells us the Cinderella story of Lauren Luke, a self-taught make-up artist.

In 2007, Lauren worked as a taxi dispatcher by day and as an eBay entrepreneur by night selling makeup brushes. To promote her brushes, Lauren started posting make-up tutorials on YouTube. Her most viewed tutorial shows how to get the smoky eye look made popular by Leona Lewis' "Bleeding Love" video. That one video tutorial has nearly 4-million views today and has forever changed Lauren's life.

Soon after posting the Leona Lewis smoky eye tutorial video, Lauren caught the attention of a marketing company who pitched the idea of starting a By Lauren Luke cosmetic product line. In 2009, Sephora, a big-time national cosmetics store chain, began selling the By Lauren Luke cosmetics line.

A Cinderella story indeed... but let's look at this from a different angle.

Thanks to social media, Lauren Luke was able to go from small-time to big-time. And thanks to social media, big-time companies can regain their small and meaningful connections with customers. As I've said before...

“Social media helps small companies look bigger and helps big companies get smaller. Meaning, a small company can have a big presence online with customers through using social media. Conversely, a big company can get ‘smaller’ because social media connects companies to customers on a very personal level.” -- JOHN MOORE

In the pages of microMARKETING, Greg Verdino identifies "seven shifts" happening in marketing because of social media. He shares examples how small companies, like By Lauren Luke, are using smartly using these "seven shifts" brought on by social media to look bigger.

Interestingly, these "seven shifts" Verdino has identified can also be used by big companies to get smaller by being more personal with customers.

Verdino shows how Coca-Cola gets smaller in customers' eyes/minds through social media using its Facebook fan page. The Ford Fiesta Movement is highlighted as a way to develop micro relationships with bloggers to get macro awareness. Verdino also shows how Best Buy gets smaller by providing one-to-one customer service on Twitter through the Best Buy Twelpforce team.

No matter the size of your company, for it to grow bigger you must start getting smaller in how you connect with current and future customers. That's the lesson learned from chapter 9 of Greg Verdino's microMARKETING book. And that's the challenge businesses have today in order to succeed tomorrow.

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DISCLOSURE: I'm an avid business book reader and because I blog frequently about business books, publishers will send me free copies. That explained, I purchased my copy of microMARKETING for this review.

Gatorade Doesn't Get It

In today's Wall Street Journal we learn, Gatorade has four full-time staffers monitoring "social-media posts 24 hours a day ... hoping what they see and learn will help the company more effectively promote its new G-Series of drinks. Whenever someone uses Twitter to say they're drinking a Gatorade or mentions the brand on Facebook or in other social media, it pops up on a screen in Mission Control."

Mission Control?

Gatorade, we have a problem ... social media can't be controlled. If your MISSION is to CONTROL conversations people are having about Gatorade in social media, you will fail. #justsayin

Your "Hall Pass" to Haul Videos

I recently became hip ... hip to haul videos. Perhaps, you’ve already been hipped to haul videos. If not, consider this your haul pass to becoming hip to haul videos.

NPR did a story on it. So did Marketplace. Newspapers have written about it. And I’m fascinated by it.

What is it and why am I so fascinated by it?

Haul videos are simply online video recordings where people, generally teenage girls, talk about their recent purchases. For example, Juicystar07 has posted about 200 haul videos and has nearly 24-million views for her videos sharing commentary on products she’s purchased from retailers including Forever 21 and Ulta.

With viewership numbers like that coupled with priceless third-party endorsements, you can clearly understand why retailers are excited by this marketing trend.

JCPenney, in a recent back-to-school promotion, jumped on the haul video brandwagon by providing gift card to six girls to do a video show and tell of their shopping haul from JCPenney. So as not to run afoul of FTC guidelines on endorsements and to help keep online word of mouth credible, the six girls disclose upfront they were given free gift cards from JCPenney. (Watch Annie’s JCPenney haul video, she discloses immediately the freebies she was given.)

This is all fascinating.

However, I can’t let teenage girls have all the fun with this. I want in on the haul video action. Really I do...

Listening Spurs Talking

According to Advertising Research Foundation president Bob Barocci, “The single biggest opportunity in the history of consumer marketing lays dormant.” The opportunity Bob speaks of is LISTENING. And for those you deep into social media you understand the benefits of listening and how listening spurs talking from customers.

In an updated version of his book, 501 Killer Marketing Tactics to Increase Sales..., Tom Feltenstein plays off the listening angle and frames word of mouth in a way I haven’t heard before...

“The best way to word of mouth commitment from your customers is by opening your mouth. Talk to your customers, and listen to what they have to say. When they give you advice, try not to dismiss it out of hand. Instead, hear it, digest it, and take away everything that makes sense.”

Before customers spread word of mouth about a business, a business must first open its mouth (and ears) and talk (plus listen) to its customers. Love it.

You know you have a great marketing idea when...

In SAVE THE CAT! STRIKES BACK, Blake Snyder, accomplished screenwriter, shares “seven warnings signs” a writer has a great idea for a screenplay. It’s a good list and with a little massaging, Blake’s list also works for marketers. Here's my twist on Blake's list:

You know you have a great marketing idea when...

#1. You love talking about the idea with anyone, anywhere.

#2. You have no fear someone will steal your idea.

#3. You feel giddy knowing others view you as a smart marketer.

#4. You know the more you work on the idea, the better it gets.

#5. You poke at potential flaws in the idea, knowing it’s an opportunity to make the idea stronger.

#6. You have researched the idea and know no one has done it like you plan to do it.

#7. You know the idea is tactically doable and strategically reliable.

Pathetic Starbucks Promo Poster

In my TOUGH LOVE ebook, it’s not hard to figure out that “Galaxy Coffee” is Starbucks Coffee. So when the screenplay depicts the drive, drama, and decline of Galaxy, it’s really business commentary on the goings-on with Starbucks.

There’s a scene in TOUGH LOVE where the Galaxy CEO, David Pearl, criticizes his executive team for all their shortsighted and “off-brand” marketing ideas to kick-start sales. In his badgering, David implores the executives to “never communicate like a fast food company.”

If David Pearl were the CEO of Starbucks Coffee and not of the fictitious Galaxy Coffee, this pathetic Starbucks promo poster would rankle him.

This promo poster for mini donuts has no soul ... no emotion ... no style ... no creativity. And, it has no business being inside a Starbucks.

A soulless generic poster fits inside a run down gas station or perhaps a mom and pop Gyro shop, but not inside a Starbucks. That's my TOUGH LOVE for today.

What is a Talkable Brand?

This is an interesting presentation from WOMMA. (Yes, I do work with them.)

It's a collection of word of mouth marketers and their different views on what makes a brand talkable. Smart stuff. Enjoy...

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DIFFERENT | Youngme Moon

Todd Sattersten clued me in on a book about differentiation from Youngme Moon, a Harvard Business School professor. Yes, the business book landscape is littered with oodles of books on differentiation but Youngme's book is ... different.

You'll notice early on in "DIFFERENT: Escaping the Competitive Herd" that Youngme's writing style is more casual teaching than charismatic pontificating or hardcore drill-downs. It's an enjoyable read with approachable and actionable lessons.

For a preview of the book, watch this well-produced trailer...

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Emulate Drug Dealers (part 2)

The other day we looked at the advice from the founders of 37signals who write in their book, REWORK, “Emulate drug dealers. Make your product so good, so addictive, so 'can't miss’ that giving customers a small, free taste makes them come back with cash in hand.”

We also shared some more business wisdom from drug dealers on surpassing customer expectations, wholesale buying strategies, and selecting profitable customers.

If this idea of emulating drug dealers has you intrigued, reacquaint yourself with a vintage Brand Autopsy post sharing business lessons learned from the movie about a Harlem drug lord from the early 1970s, AMERICAN GANGTSER.

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American Gangster synopsis:
Following the death of his employer and mentor, Bumpy Johnson, Frank Lucas establishes himself as the number one importer of heroin in the Harlem district of Manhattan. He does so by buying heroin directly from the source in South East Asia and he comes up with a unique way of importing the drugs into the United States. As a result, his product is superior to what is currently available on the street and his prices are lower. His alliance with the New York Mafia ensures his position. It is also the story of a dedicated and honest policeman, Richie Roberts, who heads up a joint narcotics task force with the Federal government. Based on a true story. [SOURCE]

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AMERICAN GANGSTER | BUSINESS LESSONS

LESSON ONE
Mentors Matter

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LESSON TWO
Launching New Products

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LESSON THREE
Brand Dilution

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LESSON FOUR
Leadership Qualities

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LESSON FIVE
The Loudest is the Weakest

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LESSON SIX
Winners Can Quit

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Emulate Drug Dealers

In the book REWORK, the authors, Jason Fried & David Heinemeier Hansson (co-founders of 37signals) recommend emulating drug dealers by offering free samples to customers. Drug dealers, as Jason and David point out, know by giving away free samples of a “product so good” and “so addictive,” customers will “come back with cash in hand.”

Businesses, according to the authors, shouldn’t “be afraid to give a little away for free” so long as they are confident in the products/services they sell. As cited in the book, ice cream shops confidently give away free samples knowing it will most likely result in a sale. Car dealers do the same by allowing potential buyers to test drive a car before buying it.

Why stop at emulating drug dealers by only giving away free samples?

Businesses have a lot more to learn from the business practices of drug dealers. From procurement of product to acquiring customers to satisfying customers, the parallels between a well-run drug dealing operation and a successful business run thick.

This is territory we’ve covered on the Brand Autopsy blog. In early 2004, we ran a 7-part series on “Street Corner Selling” which shared drug dealing business lessons from Bruce Jacobs' book, DEALING CRACK.

The lessons have held up well. Read for yourself...

Street Corner Selling Curriculum:

Lesson #1: Customer Acquisition
Don’t Act Desperate

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Lesson #2: Ten Minute Rule
Surpassing Customer Expectations

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Lesson #3: Procurement
Wholesale Buying Strategies

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Lesson #4: Merchandising
Maximizing Sales Through Bundling

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Lesson #5: Angel Customers and Demon Customers
Selecting Profitable Customers

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Lesson #6: Developing Enthusiastically Satisfied Customers (pt. 1)
Generating Customer Referrals

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Lesson #7: Developing Enthusiastically Satisfied Customers (pt. 2)
Making it Easier for Customers to Buy

A Crowdsourced Barbie Doll

Mattel, the makers of Barbie dolls used crowdsourcing to decide which career the next Barbie doll should have. Mattel promoted its online crowdsourcing contest on Facebook, Twitter, and with some regional advertising. The voting choices were: Architect, Anchorwoman, Computer Engineer, Environmentalist, and Surgeon. Over 600,000 votes were cast and the winner was...

Or was it?

Since the voting was open to anyone anywhere, non-Barbie loving fans were able to cast their ballot. Young girls, who are Barbie loving fans, voted overwhelmingly for Anchorwoman Barbie. Other non-Barbie loving fans voted for Computer Engineer Barbie.

The Barbie community voted for the Anchorwoman doll and a well-orchestrated crowd of engineers voted for Computer Engineer Barbie.

To Mattel’s credit, they are following the direction of the crowd and releasing a Computer Engineer Barbie. Mattel is also giving its real community of fans what they want by producing an Anchorwoman Barbie doll.

What if Mattel hadn’t used crowdsourcing but rather, "communitysourcing" to decide what career Barbie should have next? Communitysourcing could have saved Mattel from spending unnecessary time and money addressing the matter.

Perhaps Tom Myerman is onto something when he talks about rethinking crowdsourcing in favor of communitysourcing.

re: Digital Discounts (Foursquare & Gowalla)

With Foursquare, Gowalla, and other “geo-location apps” becoming the new must-do marketing tool, I hope more businesses follow the lead of an Austin-area Starbucks.

A simple handwritten sign acknowledging the loyalty of a frequent customer is all the marketing needed to earn a gleeful shout-out and a simple photo on Twitter.

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It’s so easy for businesses to turn checking-in with Foursquare and Gowalla into a digital discount program, but is it meaningful?

Isn’t it more meaningful, as a customer, to be recognized in a special way from your favorite business than it is to receive a special discount?

As a customer loyal enough to become “mayor” of a business, does that customer need a “Buy 9 Get 1 Free” discount to remain loyal? I hope not. If so, then that “loyal” customer isn’t so loyal.

A simple acknowledgment, as shown above, can go a long way to fortifying a profitable relationship between a frequent customer and a business.

Idil Cakim on Influencer Marketing

NOTES: I am a member of WOMMA and serve as WOMMA’s “WOM Enthusiast.” Portions of this post were originally posted on the All Things WOM blog.

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The Word of Mouth Marketing Association (WOMMA) recently published a MEASUREMENT & METRICS GUIDEBOOK sharing practical insights into quantifying offline and online word of mouth. WOMMA Members have access to a free download of the paper. A bound version of the Guidebook is available for everyone.

Idil Cakim, VP of Interactive Media at GolinHarris, authored an article, “The Influence Factor,” detailing how brands can engage, monitor, and measure influencer marketing programs.

Idil recently appeared on a WOMMA Brands Council Jam Session webinar and shared her views on what constitutes offline and online influence, how to find influencers, and some do’s and don’ts of Influencer Marketing. The following SlideShare presentation includes snippets from this recent webinar.

Influencer Marketing

View more presentations from Word of Mouth Marketing Association.

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BONUS COVERAGE:

This short Q&A with Idil Cakim will give you more perspective on designing and delivering Influencer Marketing programs.

1. What constitutes influence offline and online?
Idil Cakim (IC): “The fundamentals of offline and online influence are the same: perceived knowledge of the influencer, credibility and hence trust. In the offline world, we have more access to visual, cultural and social clues that help us assess the influence factor. Meanwhile online, we have more third-party resources and published statements that can help us assess a given source's influence and authority. Whether online or offline, influencers are experts who know how to spread their messages either through peer-to-peer conversations, organized activities or publications.”

2. Any pitfalls to Influencer Marketing?
(IC): “The most common pitfall is sharing an idea or a product with too few influencers and expecting to move the needle. An influencer is bound to take the message further than the average person. However brands may need to engage hundreds of influencers at a time to have quantitative results that show the impact of their efforts.

Another point for consideration is that not all influencers are equal. Brands and organizations first need to determine what constitutes influence in their respective fields and research thoroughly when identifying their own set of influencers.

Lastly, thinking in terms of campaigns with limited times for outreach undercuts the value brands/organizations can derive from influencer relations. Spot outreach is fine, but there needs to be ongoing communication between the brand and its influencers, just like any healthy relationship.”

3. What are three steps a brand should take to design a better influencer marketing program?
(IC): First, determine your own influencer criteria and make sure you can recruit enough influencers who can create noticeable change.

Second, as you design your program, think of your communication goals and clarify what will determine success. Is it only increase in awareness or change in some type of behavior? Make sure that your program is designed to reach these goals.

Third, plan for ongoing engagement. Sustain authentic communications and continuously offer value to your influencers through news, information, first-to-try types of offers.” [SOURCE]

PRICELESS | in less than 300 words

Next up on the “Less Than 300” project is William Poundstone’s PRICELESS.

(Truth be told, ain’t no way PRICELESS can be fully summarized in less than 300 words. No way. But, I’m giving it a shot.)

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PRICELESS | summarized in less than 300 words

PRICELESS is an advanced studies book on pricing practices, perfect for MBA students, product marketers, and entrepreneurs. The author, William Poundstone, draws from studies by renowned economists to dive deep into the psychophysics of money to explain how the “mundane act of naming a price ... turns out to be a surprisingly tricky process.”

If you lack the mind of an economist, expect to occasionally get lost in the book. However, just as you find yourself befuddled, you’ll become intrigued as Poundstone shares smart, actionable advice on how to effectively use bundling tactics, anchoring pricing strategies, and menu design to optimize the margin potential of retail products and services.

Bundling tactics, such as combo meals at fast food joints and prix fixe options at spendy restaurants, effectively use the art of confusion to get customers to spend more money. By bundling a la carte menu items together, most customers fail to do the math to see how much more they are actually spending.

Although anchoring pricing strategies have been commonplace for centuries, they are still powerful pricing levers. When a company offers something at an outrageous price as well as offering something comparable at a reasonable price, it’s using an anchor pricing strategy. A retailer doesn’t expect to sell a $50,000 watch. They do expect; however, to sell lots of comparably more favorable $500 watches.

The science behind the design of restaurant’s menu is complex and customers who order solely based on price are unprofitable diners. To get customers focused on choosing dishes with fewer pricing distractions, Poundstone shares simple typography advice including, eliminating dollar signs and decimal points. This helps diners to not see a menu as a price list from which to order cheaper items.

PRICELESS is priceless in how it reveals retail prices “are influenced by factors the conscious mind would reject as irrelevant, irrational or politically incorrect.”

WORD COUNT: 311

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[NOTE: I often receive free copies of biz books from publishers and publicists. However, I spent my money for my copy of PRICELESS.]

WOMMA Conference: Recap Presentation

*** Note, my WOM Enthusiast hat is on with this post. ***

When you return from a conference chock-full of insights, it’s difficult to share everything you learned. Sure, you can transcribe your notes but your notes are bound to have some holes. You can also pull insights from summaries other attendees have posted on their blogs.

Or ... you whittle through the thousands of tweets from attendees to carve out a more complete list of insights. That’s the path I’ve chosen to take after returning from WOMMA’s Creating Talkable Brands conference.

Over 470 attendees shared 3,600+ tweets (.pdf download) with the #WOMMA hashtag during the three-day conference. I’ve whittled down the 3,600+ tweets to a more digestible collection of 165 tweets and compiled them into this SlideShare presentation. Enjoy.

Talkable Tweets from WOMMA's 2009 Summit

View more presentations from Word of Mouth Marketing Association.

File Under: MISSED OPPORTUNITY

Something doesn’t make sense with this poster ad on the DFW Airport skylink tram. Do you see what I saw?
If I’m advertising a “treat yourself” occasion at the airport during the hullabaloo of holiday travel, I’m choosing something more treat worthy than a low-fat soft pretzel. There are lots of "treat yourself" opportunities at DFW Airport that out indulge a basic pretzel.

No More Starbucks Gold

Lots of chatter online about the revamped Starbucks “rewards” program. Starbucks will discontinue its Gold Card program it began a year ago. The Starbucks Gold Card program was designed like many membership rewards program where customers pay a yearly $25 fee and in return they receive free refills on brewed coffee, free wi-fi access, and 10% off on all purchases.

Beginning December 26, Starbucks will replace its Gold Card program with a "My Starbucks Rewards" program offering customers a free beverage after 15 purchases. (There are a few other small perks in this program but it's essentially a Buy 15 Drinks, Get 1 Free program.)

Starbucks is touting its new rewards program as an improvement because of its simpler design and the no annual fee.

However, the consensus from the online chatter is this new program benefits less frequent Starbucks customers (2-to-3 visits a month) than the very frequent Starbucks customer (8+ visits a month).

Obviously the redesign of this program will benefit Starbucks more financially. Perhaps offering a 10% discount to Gold Card members on all purchases was profiting heavy-spending customers more than it was profiting revenue-needing Starbucks.

Whenever I read about new Starbucks business happenings, I refer back to the book I wrote about Starbucks foundational business practices. In TRIBAL KNOWLEDGE, there’s a short section on fostering customer devotion where I give the old school Starbucks perspective on “Preferred Shopper” loyalty schemes, such as a Starbucks Gold Card program or the new My Starbucks Rewards program...

“These ‘Preferred Shopper’ promotions also reverse the logic of great customer service: they ask customers to sign up for a card or buy a certain amount of product before they can enjoy the benefits of being part of the club. Do you really want to create two classes of customers? One that gets the ‘good stuff’ at a good price, the other that gets a raw deal? If you want to foster true customer devotion, don’t make your customers jump through hoops just to feel welcome, or 'preferred.'

Businesses operating like this treat their customers like cattle, doing whatever they can to attract attention. When companies are more focused on their own bottom line than their customers, both will eventually fall away. These programs lack soul and meaning to stand the test of time.”

The last paragraph in this chapter shares a thought more businesses, especially Starbucks today, need to pay attention to:

“Customer loyalty works both ways, and Starbucks knows that. Of course Starbucks wants to maintain its profitability, but it does this by helping the folks who come into its stores, not by working against them. If you want customers to stay loyal to you, stay loyal to your customers—treat them as people, help them as individuals, offer them something extra, and they’ll come back for more.”

You can read the full chapter, TRIBAL TRUTH #28: Foster Customer Devotion, in the box below:

Foster Customer Devotion

SUMMARY | WOMMA’s Disclosure Webinar

*** Clearly my WOM Enthusiast hat is on with this post.

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BACKSTORY
This fall, the Federal Trade Commission (FTC) will release updated guidelines on endorsements used in advertising and marketing. Current guidelines were last updated long before the Internet became an irreplaceable communication/networking channel and before marketers understood the irrefutable power of word-of-mouth marketing.

The FTC works to protect consumers from being influenced by unethical, untruthful, and unscrupulous business practices. Updated guidelines will address the need for endorsers, reviewers, and businesses to be 100% transparent and disclose when material compensation (in-kind gifts, special access privileges) and outright compensation (cash) changes hands.

On September 14, 2009, WOMMA hosted a webinar on ETHICS & ENDORSEMENTS: What is Adequate Disclosure. The diverse panel included marketers, entrepreneurs, a professor, a marketing analyst, and a lawyer.

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TAKEAWAYS
The resounding sentiment was marketers and bloggers need to design word-of-mouth marketing programs to state early (and often) when material compensation changes hands.

It is a non-negotiable … businesses must solve for being obvious and upfront when a brand offers in-kind gifts, special access privileges, and cash as part of a marketing program designed to spark word-of-mouth.

Solutions discussed by the panelists centered around being clear and conspicuous when disclosing material relationships between a brand and a consumer. Practical implications talked about on the webinar included: “disclosure badges” on websites, prominently placed “terms of engagement” practices, specially designated “product review” blogs, and uniquely tagging of tweets (such as [#ad]).

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WATCH. LISTEN. LEARN.
You can watch, listen, and learn more by watching this highly edited version of the webinar. This 11-minute version shares key takeaways spoken by the panelists.

SHORT VERSION | Ethics and Endorsements: What is Adequate Disclosure?

View more presentations from Word of Mouth Marketing Association.

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LEARN MORE. DO MORE.

• The complete 60-minute webinar can be accessed here.
• You are invited to dig deeper into this important matter by reading and contributing to WOMMA’s Living Ethics Blog.

smart advice from socialnomics

Over the weekend I bought and read Erik Qualman's SOCIALNOMICS book. It's a deep dive into how social media transforms the way we live and do business.

In chapter seven, Erik writes about "Winners and Losers in a 140-Character World." One line jumped out at me as a brilliant way to explain the best approach for businesses participating in the online conversation.

Batter Blaster

When I finally got around to using Batter Blaster, one word came to mind … PURPLE … as in PURPLE COW. This video ditty explains …

RSS Readers … click here to view the video ditty

WOM at Work

In 2005, Seth Godin wrote the FREE PRIZE INSIDE. It's essentially a guidebook for creating remarkable products and services. As marketers we know when remarkable things get remarked about ... word of mouth happens.

This 2-minute video ditty I posted on the All Things WOM blog shares two word-of-mouth worthy free prizes I experienced while staying at the Hotel Burnham in Chicago. (Yes, I mispronounce the hotel’s name in the video. My bad.) Enjoy.

RSS Readers … click here to watch the video.

An Ethical Question … Please Comment

UPDATED (June 10): Thanks everyone for the thoughtful comments. To avoid any question ... going forward, I will disclose how I receive business books reviewed on the blog.

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Lots of great conversation is happening about the ethics of compensating bloggers with cash, in-kind gifts, and special access privileges in exchange for writing a post about the product/service a business provides them.

This conversation has me thinking about how I’ve been compensated for some posts on this blog.

Because I frequently write business book reviews, publishers and publicity firms send me free business books. I’m under no obligation to write anything (be it positive, negative, or nothing at all) in exchange. While not cash, this in-kind gift has a monetary value of about $25 per book.

I’ve probably written over 100 business book reviews on this blog. Some reviews have slammed the book as worthless and others have praised the book as worthwhile. In every case, my authentic opinion has been expressed.

However, I’ve never disclosed when a review is from a business book I received as a gift or from a book I purchased. (By the way, the vast majority of my book reviews are from books I've purchased.)

I’m curious … Do you expect me to disclose whether or not I was gifted the book or paid for the book? Would you trust my review more with this type of disclosure?

Thanks for sharing your feedback.

Video Recap: MySpace or Facebook? Or Both?

On May 13 & 14, WOMMA held its Word-of-Mouth Marketing University conference. Below is a video recap of a presentation from the conference.

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The world’s two largest social networks, MySpace and Facebook, attract over 130-million users monthly. Thus the question has changed from IF you should use MySpace or Facebook to reach your customers to HOW. How can attention, affinity, and action happen best on each site? How do marketing messages spread differently between the two? How best to monitor and measure a brand’s performance on each site?

Those questions and more were answered by Heidi Browning from MySpace and Chris Pan from Facebook during the kick-off keynote to Day 2 of WOMM-U.

For smart recaps, I recommend reading posts from Josh Hallet, John Bell, and Ian Sohn. The moderator of the panel, David Berkowitz, also posted a good summary of the session.

I plopped my rinky-dink camera atop the banquet table in the dimly lit ballroom and captured much of the session on video. Because this session was so informative, written summaries fail to cover all the content. So, you should watch it for yourself and jot down your key takeaways.

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VIDEO ONE:
In this segment you’ll learn about audience/demo profiles for MySpace and Facebook (0:00 to 2:45). Plus, you’ll hear Heidi and Chris share best practices from brands including Vitamin Water to Papa Johns Pizza to Starbucks to Cheetos to Aflac (2:46 to 9:35).

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VIDEO TWO:
Both Heidi and Chris talk about the importance of creating engagement and community with users when designing marketing activities on MySpace and Facebook. Lots of great information in this segment.

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VIDEO THREE:
Measurement matters to marketers. In this segment, you’ll learn how MySpace uses the momentum effect to evaluate success of a marketing activity. Facebook uses measurements of engagement to determine success/failure. Deep stuff. Watch, listen, and learn.

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NOTE: crossposted on the ALL THINGS WOM blog

Recap: YouTube presentation

NOTE: crossposted on the ALL THINGS WOM blog

On May 13 & 14, WOMMA held its Word-of-Mouth Marketing University conference. Below is a recap of a presentation from the conference.

Presentation:
Maximizing Online Video for Marketing Success

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Presenter said:

Jeben Berg, creative director of Cross Platforms Solutions at YouTube & Google, threw out some startling stats about YouTube during his presentation ... it’s 81-million unique monthly visitors makes YouTube one of the most trafficked websites in the world ... each minute, another new 15-minutes of video is uploaded to YouTube.

Obviously, YouTube is a media and marketing channel to be reckoned with and smart companies are finding ways to integrate YouTube into their marketing mix. Jeben explained there is “no single formula" for online video success. There are, however, lots of best practice tips on how to improve the effectiveness of online videos.

First, focus on great ideas rather than production values. Companies like BlendTec and its “Will it Blend” series begin with a singular idea — such as, will an iPhone blend? — to create simple yet interesting videos. According to Jeben, following the BlendTec approach of “high concept with low fidelity” is a recipe for creating compelling online video.

Second, think quantity more than quality. Jeben explained brands that post lots of videos gain the most viewers and receive the most must-see recommendations from friends.

Third, make the most out of your Title, Description, and Tags. Don’t get too cute with your video title names. Use key words and commonly searched terms in the Description of your videos. And, spend extra time making sure you Tag your videos with the most appropriate terms. Something simple as a good title, robust description, and relevant tags will help online videos get better visibility through search engines.

Jeben jokingly talked about how many CEOs of big brands have called YouTube requesting certain videos be taken down. As long as a copyright isn’t infringed upon, YouTube leaves such videos alone.

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Audience tweeted:
@VirginiaMiracle was impressed with the short case study on how the rock band, Weezer, analyzed the stats behind their videos, “weezer used their YouTube stats to determine that no one in the state of Oklahoma cares about weezer.” By knowing how few viewers there were from Oklahoma, Weezer decided not to make a tour stop in the state.

In response to Jeben talking about the recent Domino’s video incident, @spikejones tweeted, “CEO of Domino’s called called YouTube and tried to play the ‘pull down the video b/c I pump so much $$ into Google card.’ It didn’t work.”

Jeben continued the Domino’s story about the company’s video response. @TravelPRPro responded, “Money Talks. Advertising does have influence. Domino’s response to employee hoax got prime placement on YouTube bc they advertise.”

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WOMMA says:
Viral videos can give a company lots of attention. However, predicting what goes viral is nearly impossible. If you approach making a video with the intent of it going viral, you are setting yourself up for disappointment. Instead, use Jeben’s advice of focusing on a quality idea more than on quality video production. It’s interesting ideas that get people interested and when interest is achieved, online word-of-mouth is primed to spread.

Recap: Yelp presentation

NOTE: crossposted on the ALL THINGS WOM blog On May 13 & 14, WOMMA held its Word-of-Mouth Marketing University conference. Below is a recap of a presentation from the conference.

Presentation:
Yelp: Empowering Consumers with Local Knowledge

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Presenter said:

In kicking-off the Word of Mouth Marketing Association’s WOMM-U Conference, Geoff Donaker, chief operating officer at Yelp, said, "The Genie is out of the bottle. You’re better off joining the conversation, than not." Conversations about local restaurants and businesses fuel Yelp’s business. Donaker described Yelp as, "local search powered by community."

It is the online community that provides Yelp with over 6-million reviews of local restaurants and businesses. 21-million people last month used Yelp to decide which restaurant to visit, car mechanic to use, and spa to be pampered at. With its broad reach and deep reviews, Yelp is changing the game of small business marketing.

Donaker told the story of a local carpet cleaner who used to spend $100K on yellow page advertising. Thanks to all the new business generated by positive reviews on Yelp, this carpet cleaner no longer spends money on yellow page advertising. Instead, this business is spending much of its advertising budget on improving it’s customer service, resulting in more positive reviews on Yelp.

Donaker also discussed how businesses have a love/hate relationship with customer-driven reviews. Businesses love how great customer service is rewarded with positive reviews. However, they hate the loss of message control. That said, the positive to negative review ratio at Yelp stands at 6:1.

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Audience tweeted:

@ErikNYC mentioned the beauty of Yelp’s customer-driven model is that "when the customer wins, the business wins." Echoing sentiments from the presentation, @gamedayjreau tweeted, "It’s always about customer service at the end of the day."

In response to a case study example of how negative reviews can become positive for businesses, @leslieforde commented, "It’s worth engaging vocal customers gently. Reaching out to angry customers can change negative perception."

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WOMMA says:

The love/hate relationship with customer-driven conversations is real. Word-of-mouth offline and online can not be controlled, only sparked. A business cannot ethically control what customers say about them. One of the best ways to spark word-of-mouth conversations is through delivering outstanding customer service and providing remarkable products.

For any business wanting to spark word-of-mouth conversations, it must first spend time and money to gain utmost confidence in their services and products. This confidence will give a business thick enough skin to withstand negative reviews as well as a solid foundation from which a virtuous cycle of positive reviews will fuel business growth.

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LEARN MORE at WOMMA.org

The 10-10-10 Consequences Model

NOTE: crossposted on the ALL THINGS WOM blog

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Suzy Welch, business writer, has an intriguing way to quickly analyze the consequences of decisions. When faced with making difficult choices, Suzy will 10-10-10 it. Meaning, she will take a few moments to consider the consequences of a decision that may occur in the next 10 minutes, 10 months, and 10 years.

Suzy’s 10-10-10 model is a simple (and smart) way to analyze immediate, short-term, and long-term consequences of a decision. Plus, it’s so applicable to making important marketing decisions, especially in today’s online social world.

Except, we need to amp up Suzy’s 10-10-10 thinking to account for how quickly information spreads online. 10 minutes. 10 hours. 10 days. That’s a more workable 10-10-10 consequences model for marketers dealing with issues worthy of explosive online conversation, such as the marketing disaster recently faced by Dominos Pizza.

Because it took Dominos more than 24-hours to respond, the company was singled-out as being uncommunicative and unresponsive to the groundswell of online commentary on twitter and various blogs. Similar slow-reacting critiques have been hurled at Motrin (#motrinmoms) and Amazon (#amazonfail).

Dominos, Motrin, and Amazon all suffered immediate consequences of not making a decision on how to respond within 10 hours of the incidents they faced. The online chatter spiked and to an extent, took on a life of its own. However, these three brands did ultimately respond and the twitter storm receded within 10 days. For Motrin and Amazon, sales haven’t suffered from these missteps. Time will tell if the gross-out video will hurt Dominos sales this quarter.

We are still learning that responding quickly to marketing matters discussed online is vital. Using the10-10-10 rule should be helpful for companies in similar situations faced by Dominos, Motrin, and Amazon.

For example, within the first 10-minutes, a company should acknowledge what is happening. No answers. No explanations. Just an immediate acknowledgement using whatever social media tool a company feels most comfortable using will work. However, within 10-hours, a company should go beyond acknowledging to responding by explaining what happened and what specific actions the company is taking to address the issue in order to reassure people they can trust the company again. If done right and timely, negative consequences will be minimized 10-days after the initial flare up.

Is responding within 10-minutes realistic? Probably not. However, a response within 10-hours is realistic and expected in today’s always-on information cycle.

We keep learning the faster the response, the less damage done. If a company fails to respond quickly to these flare-ups, the consequences can last 10-years and not 10-days.

salience AND sales

In January, Hyundai did a major ZAG. Other car companies decided to play the “Zero Down. Zero % Financing.” card as well as the “Employee Discount for Everyone” card to rescue drowning sales. Hyundai didn’t. Hyundai zagged while others zigged.

Hyundai introduced an alternative marketing program that didn’t rely on the same easy credit, wallet-stretching gimmickry that got us in this current dismal economic mess.

Understanding the lack of confidence consumers have with their job stability, Hyundai created a marketing program to reduce the risk in buying a car. The program was called the Hyundai Assurance plan. Its mechanics were simple: if you lost your job after buying a new Hyundai, you could walk away from your loan or lease and return the car to Hyundai.

In marketing, salience occurs when a business designs a marketing program that connects emotionally and rationally with consumers. In business, sales occur when people buy stuff.

The beauty of the Hyundai Assurance marketing plan is in its salience and its sales. With a 10.0% unemployment rate on the horizon, it’s no secret people lack confidence about when their next paycheck is coming. Sales results of the Hyundai Assurance marketing plan are astounding.

Overall car sales in the United States have declined about 40% from the same time last year. (Yikes!) Hyundai car sales aren’t in decline. Nope. So far this year, Hyundai has recorded an increase of nearly 5.0% from the year prior.

As marketers, we must applaud Hyundai for designing an effective marketing program that drives both salience and sales.

SOURCE: New York Times Magazine article (Rob Walker) | March 22, 2009

Mighty Fine Word-of-Mouth

Recently Ben McConnell (Church of the Customer) shared his perspective on the distinction between Word-of-Mouth (WOM) and Buzz. (It’s a good read.)

His post rekindled some of my thoughts on Creationist WOM vs. Evolutionist WOM (video clip). The Creationist WOM marketing mindset is about making the marketing activity something to talk about as in attention-grabbing stunts and gimmicks. The Evolutionist WOM mindset is about making a company’s products, services, and or experiences worth talking about.

Creationist WOM marketers believe Word-of-Mouth just a marketing issue. While, Evolutionist WOM marketers believe Word-of-Mouth is an everyday business issue.

We’ve seen Creationist WOM theory at work recently with Denny’s stunt of giving away 2-million Grand Slam breakfasts for free and all the gimmicky commercials shown during the Super Bowl.

Specific instances of Evolutionist WOM theory at work are more difficult to notice. That’s because these marketing activities are not supposed to be easily noticed by customers. These activities are simply how a business does business. It’s less about marketing and more about how an interesting business operates everyday.

There’s a burger joint in Austin, TX that brilliantly practices Evolutionist WOM thinking — Mighty Fine Hamburgers.

No stunts. No gimmicks. No one-off marketing ploys. All Mighty Fine does is earn opinions by serving up remarkable burgers in remarkable ways.

Let me count some of these remarkable ways.

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#1 – The Queue
Total cattle call. I’ve never been to Mighty Fine when the queue wasn’t at least 10 people deep. You go expecting to wait in line. Anticipation heightens the senses. Besides, long lines that move fast mean a restaurant is doing something right, right?

#2 – Fun Language
If you want Mustard, you gotta say, “Yeller.” “Red” gets you Ketchup and “White” gets you Mayonnaise. Mighty Fine could have gone the common, boring route with Mustard, Ketchup, and Mayonnaise. They didn’t. They decided to make the common uncommon. So uncommon that it’s worth talking about.

#3 – Service
Ask a Mighty Fine employee behind the counter how they’re doing and you’ll likely hear, “Mighty Fine.” They smile. They laugh. They look like they are having fun. Which all benefits the customer experience. Mighty Fine prides itself on hiring only “A Players” who are positive, supportive, and cooperative. To attract “A Players,” they pay above-average wages and offer much better than expected benefits. Mighty Fine knows by astonishing employees, they in turn, will astonish customers.

#4 – Assurance
When placing your order, the Mighty Fine employee writes all your requests directly on the bag. To close the order, the employee again goes over everything with you to best ensure you get exactly the burger you ordered. This process takes time but I’m sure it cuts down on mistakes. As a customer, I appreciate the thoroughness because it brings about assurance.

#5 – Picnic Tables
Old-school family-style picnic tables. Nothing fancy. Nothing fancy needed at a burger joint. This family-style seating makes it comfortable for all ages and helps to encourage conversations between customers from different parties.

#6 – Theater
Taking a page from Krispy Kreme's doughnut theater, Mighty Fine lifts the veil on some of their prep work. The window is wide open for everyone to see the ground chuck getting hand-formed into patties. The krinkle-cut fry cutter is always-on with an employee shooting whole potatoes down the cutting chute. The hamburger cooking and shake-making stations are just behind the counter for everyone to see. Mighty Fine has nothing to hide. It’s operations are in full view of every customer. (Unlike most burger joints.)

#7 – Quality
100% natural beef. Ground in-store. Hand-formed in-store. Fresh cut crinkle-cut fries. Sea Salt is the only salt used. Custom-made beef franks. Hand-dipped and hand-spun milkshakes. Quality is everything to Mighty Fine because they believe quality ingredients produce the tastiest food. (Hard to argue with Mighty Fine here.)

#8 – Smiles
Everywhere you look customers are having a good time. I’m a touch cynical; however, my cynicism subsides when inside Mighty Fine. A good hamburger in a family-friendly setting appeals to young, old, and everyone in-between. (Including this hardened marketer.)

#9 – Mighty Tasty
My Dad is a burger aficionado. In his nearly 75 years, Al Moore has cooked and eaten a lot of burgers. He’s burger expert if there could be one. After visiting Mighty Fine in January, he’s been talking about it with his circle of friends. I asked him what he tells people about Mighty Fine and this is what he says, “The place is awesome. Lots of production people, each knowing their job. The product is even more awesome — a top-notch hamburger. To my surprise, the family-style works. I’ll be back.” That’s one helluva endorsement.

#10 – Job Recruitment
Instead of a pamphlet by the soda machine to attract new hires, Mighty Fine uses a classic grocery store number dispenser like we used to use at the butcher counter. This dispenser is prominently located in the entry/exit way area for potential new hires to see going in and going out. A sign above the dispenser says, “Apply Now.” You pull the ticket and it directs you to a website to learn more information and to apply online. Again, Mighty Fine is simply making the common uncommon. Nice touch.

#11 – Clean Hands
It’s a “jacuzzi for your hands.” That’s what the hand washer says used at Mighty Fine. It’s the same hand washer employees use, so you know it is more sanitary than the common hand sink washer. Kids clamor to use this hand jacuzzi. Parents are always seen lifting up their kids in order for their hands to fit inside the washer. Of course, parents use it too because it’s just so unique you have to use it. Yet again … another way Mighty Fine takes something common and makes it so uncommon it's worth talking about.

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Every one of these 11 examples are WOM-worthy. Each one showcases how Mighty Fine turns mundane business matters into something so special that they earn opinions from customers. Because these activities earn opinions, people talk. And because people talk, there is always a line at Mighty Fine. And because there is always a line, Mighty Fine has opened a second location.

Mighty Fine doesn’t need gimmicks to get customers talking. It just does business every day in such a way that people gladly talk about it.

Mighty Fine understands the importance of Word of Mouth. How do I know? This sign displayed in the exit way tells me...

What if Starbucks Marketed like a Church?

This blog has received lots of links from progressive-minded churches wanting to improve their marketing. It's my turn to reciprocate.

Just as churches can learn something from business marketers, business marketers can learn something from churches. Churches do things to turn off potential Christ-followers. And businesses do things to turn off potential customers.

In this video parable, the Beyond Relevance blog shares how churches subtly construct barriers to making new attendees feel welcome. Enjoy and learn ...

RSS Readers ... click here to watch the video.

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** Kudos to Danny Franks for the heads-up.

What is a Good Idea?

I just read one of the more compelling definitions of what a “Good Idea” is. This definition is remarkable in its brevity and clarity. You might also agree …

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“A really good idea is simple, unexpected and relevant. And it unites extremes: it should risk a lot but nevertheless be easy to implement. Everyone should talk about it, but existing customers should not be irritated by it.”

Nadja Schnetzler
co-founder, BrainStore
source: THE IDEA MACHINE (Wiley, 2005, pg. 56)

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Buzz vs. Sustainable WOM

Kathy Sierra brilliantly (and succinctly) sums up the difference between "Buzz" and "Sustainable" Word-of-Mouth.

*** source link ***

This One Time at Brand Camp…

As part of the Post2Post Book Tour, we’re pimping Tom Fishburne’s newest collection of cartoons illustrating the funny side of business life in the trenches of brand management.

BRAND CAMP is basically Dilbert for Marketers. With Dilbert, Scott Adams focuses on finding humor in every department of a big business. On the other hand, Tom, with super-strong CPG marketing chops, focuses his humor on every day happenings within a company’s marketing department. Nothing marketing-related is out-of-bounds for Tom’s sharp and sometimes painful wit…

He mocks the belief of Brand Loyalty (image)...

He makes light of Psychographic Profiling...

He pokes fun at Buzz Marketing...

He ridicules Consensus Decision-Making...

He shows the derailment in developing Brand Promises...

He shoots straight about Concept Testing...

He lampoons Co-Branded Partnerships...

He redefines the meaning of earning Street Cred…

He shares what really happens when we Take it Offline…

He explains why too many marketers spoil the Attribute Soup…

He sounds the alarm for Brainstorming Sessions…

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Tom says his dedication to churning out one Brand Camp cartoon a week has made him a better marketer.

Now, I can’t say reading THIS ONE TIME AT BRAND CAMP will make you a better marketer. However, I am confident doing so will make you a smarter marketer. Why? Because you will find yourself questioning the many long-held branding practices and marketing philosophies you’ve been trained to accept.

Get on the Brand Camp bandwagon by reading his blog. You can also subscribe to his weekly emailed cartoons. Or, BUY THE BOOK. (Heck, buy 10 books and pass'em around your marketing department.) Oh yeah … Tom also licenses the use of his cartoons, read here for details.

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Learn more about Tom, his marketing career, and his unique perspective on all things marketing-related by following his Post2Post book tour junket ...
>> Fresh Peel | Aug. 25
>> Church of the Customer | Aug. 26
>> Dan Roam | Aug. 28
>> Seth Godin | Aug. 29

How the Marketer Explained Dumbness

Jonathan Salem Baskin (from the Dim Bulb blog) goes Seuss on us with his strong take on JCPenny’s advergame venture to market its DORM LIFE product line to college gals.

Sample this snippet …

Instead of putting its branding just about anywhere,
why not focus it where consumers might care?

C'mon now, it's not such a horrible bore
to come up with reasons to visit a store?

Relevance is a quality that can't be avoided,
No matter in what ways new media's exploited.

>> Now read it in full.