Monday, November 29, 2010

What Drives Us to the Drive-Thru?

For obvious reasons, food has been on my mind this week. It's hard not to be excited because, like a lot of Americans, Thanksgiving is one of the rare times when I enjoy a meal in the most traditional sense of the word. These days it seems that the main ingredient come meal time is a paper bag.

Not surprisingly, fast-food marketers are considered by many to be the ringleaders causing this phenomenon and consequently responsible for fattening the American belly. One has to look no further than California to see that. San Francisco recently took a cue from the neighboring Santa Clara County Board of Supervisors and banned the practice of including free toys from with food deemed not nutritious, such as certain types of Happy Meals. Certainly, it would be disingenuous to insist that the growing obesity rate, which now rests at 34 percent for adults and 17 percent for kids, and the steady rise in the marketing bill of fast-food restaurants during that time is purely accidental.

However, it's unlikely that additional government regulation and attempts to make marketing more difficult will tackle this juggernaut . Even under intense scrutiny from many government officials and industry watchdogs, a recent study by the Yale University Rudd Center for Food Policy & Obesity determined that fast-food marketers actually are increasing their marketing effort to more children.

Analyzing the 12 biggest fast food marketers, the researchers determined that the marketing efforts are paying off, too, as 40 percent of parents participating said their children asked to get fast food once a week, and 15 percent of parents with preschoolers were asked daily. However, they ultimately don't make the purchase decisions, so it's telling that 84 percent of parents said they had visited a fast-food restaurant in the past week with their children (between ages 2 and 11).

The reason parents eventually break down is understandable. As an industry, fast food is positioned as convenient, accessible, and low cost, which are pillars to the American way of life. It also holds true for parents, who also grown up on golden arches.

In my opinion, that's much too powerful a force for government to take down. I believe the only hope for change is through competition. The category will continue to diverge and the brands that will be successful are ones that position themselves differently within the category. Over time, consumer behavior will change. This is already happening in the drink category, with soft drinks lose share to different waters, tea's and juices.

All we need now is the marketers to go and do it.

This post also appeared on Talent Zoo's Beneath the Brand.

Friday, November 26, 2010

The Cable Customer

Hopefully, everyone had a wonderful Thanksgiving.

Oddly, at my house, Thanksgiving dinner morphed into a focus group about television. However, not about the shows we watch; the tastes were too diverse. Rather, the table discovered it was united in its disdain for the cable company.

"I would be paying $1600 a year if I didn't switch to satellite... Oh, those people are crooks... I thought about switching, how do you like it?... You know, I know a guy who switches companies every year just so he can get the introductory deals."

Three different households and all have a negative view of their cable company; two of whom trudge along regretfully every month.

How did their customers who at one time happily chose them become so unhappy? Its comes back to their strategy.

They set a low low introductory price to get new customers signed up. Then the price is gradually increased and services like DVR are added. Finally, they sit back and hope the customer gets attached to the service and cannot quit.

With little competition, this can work. It was effective at keeping two of the three households...so far anyway. However, in the long run, this strategy leads to greater price sensitivity. I believe it's far more effective for marketers to learn who their best customers are give them the service and incentive to stay loyal.

Maybe then consumers won't have to switch cable providers every year.

Tuesday, November 23, 2010

Bad Branding Killed Jeeves

Last week, Ask.com officially conceded that it could not beat Internet search behemoth Google, which currently controls about 65 percent of the market. Ask.com accounts for about 2 percent of the market. Barry Diller, the media mogul who purchased the search engine in 2005 for $1.85 billion said, “We’ve realized in the last few years that you cannot compete with Google.”

Unfortunately, that’s one very expensive branding lesson Diller received.

Originally known as Ask Jeeves, the Web engine operated under the catchy premise of having a personal butler fetch answers to all your questions. After the purchase, the new owners fired Jeeves and shifted their focus to algorithmic-powered Internet searches to complete with Google -- and did so at a time when it was achieving pop status as a verb for looking something up online.

Their announcement shouldn’t come as a surprise to well-schooled marketers because they know that when a single brand can get that kind of choke hold on a category, it’s no longer a fair fight. This is especially true if there is little differentiation, as most searches often return the exact same results as their competitors.

Now, the Ask.com brand is asking to be known as it once was, returning to its question-and-answer roots. This time, the human-assistance model is designed to simplify the steps needed to get the right result.

While this sounds great in theory, reality is a bit different. Scattered among the “relevant answers and links” were an equal number of irrelevant sponsored links, making the search more difficult.

Obviously, making search easier and getting paid would seem to be at odds.

Additionally, Ask.com’s rebound attempt will be more difficult than its 1990s ascent due to new and better-focused competition like ChaCha. By focusing on the text message function of mobile devices, ChaCha has created a real home for question and answer.

If Diller has any hope of doing the same, he may have to rehire his old friend Jeeves full-time.

This post also appeared on Talent Zoo's Beneath the Brand.

Friday, November 19, 2010

Deals or No Deals?


The ritualized retail insanity of Black Friday is almost upon us.

It's time to talk deals deals deals, right?. Naturally, big box stores with the means to do so are positioning on price to move product, offering their usual round of super-duper cheap.

You know the drill. Arrive early, fight (maybe literally!) the crowd and you could score a $100 flat screen television, $10 smartphone or new release dvd's for a buck. While supplies last.

Although these eye popping deals are very good at grabbing the holiday headlines, the effectiveness of such a strategy is questionable. Deep discounting can fill a mall parking lot like nothing else; however, the consequence this strategy carries is reinforcing the idea that consumers may be better off waiting. They know there will always be another sale. Additionally, these marketers will find themselves racing to the lowest price. And the grand prize is the the smallest margins.

Avoiding the race requires retailers to be steadfast in keeping their long term vision in sight. Instead of price, they appeal to a different sense of consumer reasoning this season.

Our store has helpful experts serving you. They are passionate and weren't hired two weeks ago. And they will still be here two weeks after Christmas too.

A stress-free shopping experience. We have a perfect tract record of no grandmothers being trampled and can boast zero customer knockouts.

The quality of the gift. Christmas at our store is not about unloading junk. A gift from here is one that lasts. It makes a statement and will be remembered forever. Our stuff is not hitting the clearance rack next week.

Most retailers are not Wal-Mart and Best Buy. They cannot afford sell flat screens for $100. But that doesn't mean they have to be left in the cold this December. Position the brand to be different.

I invite your comments below. Please share any examples of brands not positioning on price this holiday season. As always, thank you for reading and practice safe shopping please.

Wednesday, November 17, 2010

Statistical Intoxication

I have a small confession to make. Recently, I have found myself acting in a manner that runs contrary to my previous thoughts about not caring about this blog's statistics. It all started with an innocent little glance after a particularly well received post.

Suddenly, I found myself treating stats like email; peeking in my moments of thoughtless wandering.

How could this have happened? Actually, the answer is rather easily.

The reason is stats can make us feel good. They give our ego's a nice massage and provide a feeling of security about what were doing or saying. Further, statistics can give us something to cheer for. Can I beat last week's number of page views? Let's find out.

However, don't be mislead. Does an increase in the number of page views actually translate to better work? More influential work? Is my work really more credible if my blog is the first result on Google? Does an increase in time spent on your site prove that the new ad campaign is working?

Not really, but our brains make that jump for us. As marketers, we must fight this urge to read too much from the unknown.

Sunday, November 14, 2010

Should U.S. News & World Report Go Digital?

U.S. News & World Report recently announced it will be ditching its one million-plus paid subscriptions next year in order to move "very aggressively into digital," according to Brian Kelly, the magazine's editor.

This definitely constitutes a bold move for the magazine, considering that their paid subscriptions account for all but six percent of the print circulation. Going forward, the monthly print editions and special editions will be available only at newsstands.

While this may sound crazy, there might just be a method to their madness. Despite reaching more than one million readers every month, its circulation is on the decline, and the ad dollars necessary to be profitable are far less dependable than they used to be. Furthermore, digital ad spending appears to be on the rise.

However, the abandonment of print could be costly. Advertising dollars often shrink to advertising pennies when moved to the Web; therefore, achieving scale of Googlesque proportions is required to get rich using the digital ad formula. According to comScore, the average CPM (what one can charge for 1,000 ad impressions) is only $2.43.

Furthermore, I question whether their digital shift will prove to be as beneficial in the long run as they hope. The reason is U.S. News & World Report is a print brand and has been for a long time. Regardless of how aggressively they move into digital, many consumers will continue to perceive it as a print brand.

Consider what the following brands conjure up in your own mind: The New York Times, The Washington Post, Newsweek, GQ, Sports Illustrated, and Vanity Fair. Conversely, names like The Huffington Post, TMZ, Gawker, The Daily Beast, TechCrunch, Yahoo, and Twitter own a different image, as these brands were created as digital entities, and thus, exist in one's mind as such.

That explains how the Huffington Post outpaces online versions of established news brands like The Washington Post and USA Today and how a Web brand like TMZ can nearly triple the unique visits to the online edition of a TV brand like E!. New brands always lead a new medium.

I do give the folks at U.S. News & World Report a lot of credit for trying to focus their brand; however, I think if they move to digital they need to go one step further. Put that name rest and begin anew as a digital brand.

The Web is more challenging, but it doesn't have to be a death sentence. In fact, the need may be greater than ever. Available information multiplies more rapidly than ever, so shouldn't someone organize and make sense of it for us?

This post also appeared on Talent Zoo's Beneath the Brand.

Tuesday, November 9, 2010

This Blog Is Not Looking For A Sponsor

Forbes magazine recently debuted AdVoice, its new sponsored blog platform designed to "allow marketers to connect directly with the Forbes audience by enabling them to create content." Immediately, the blog came under fire for bearing too striking of a resemblance to the site's editorial blogs.

The American Society of Magazine editors weighed in saying that if the page was in fact paid for then it violates the basic principle of clear separation between advertiser content and editorial content. In addition, the Public Relations Society of America said to be wary of this practice.

Obviously, this is a problem for Forbes. A lack of transparency and separation between paid ads and news content will over time negatively affect the its credibility, trust and overall brand.

However, I'm positive Forbes will make the necessary fix; they will tweak the page and make it even more obvious who's words are being read.

But the root of problem goes deeper. The challenge to monetize internet properties is constantly getting more difficult, resulting in entities like Forbes to experiment with giving advertisers more. Consequently, some entities will walk an ethical tightrope trying to survive online.

AdVoice's first sponsor (SAP), defended the tactic from critics saying its an opportunity for "practitioners to share real life experiences and insights" and that it's about "conversation, not conversion."

Under normal circumstances I would agree with their take on blogging; however, the sponsored blog is a bit different. SAP pays Forbes to share its target demographic and let SAP speak to them; a transaction that makes it no longer just about conversation. Payment is not needed for conversation.

Perhaps most interesting is each has something that the other wants. Forbes has credibility and trust of an important audience. SAP has a need to advertise. Forbes wants those ad dollars. SAP wants that audience. So they share.

The problem is the more they share, the more they contribute to each others' problem. As Forbes sells more to SAP, consumers will find them more annoying and be less trusting. Conversely, the more SAP buys from Forbes the worse their advertising model becomes. The clutter builds, the ads become less effective, driving down price and creating the need for more ads.

And the cycle will continue.

As always, thank you for reading. Comments are welcome by clicking below.

Sunday, November 7, 2010

A Marketer's Quest To Engage

When marketers discuss social media, one word always makes it into the conversation. That word, of course, is engage.

We hear it all the time: "In order to be successful in this new medium, marketers cannot sit back and advertise to fans and followers. They must engage in relevant dialogue with consumers."

Unfortunately, it's no longer that easy. Social media's commercial noise rapidly increases, while our already nano online attention spans decrease, creating an always-accelerating drive-by culture.

How does one actually engage a consumer?

I believe this starts with a shift in mindset. Rather than going for the viral knockout blow and the giant leap, marketers should focus on the slow climb. Be dedicated to the medium and provide consumers with regular access to the inner workings of the "brand." Let me clarify: This not the yawn-inducing boilerplate from your website or your brochure. It's the real stuff.

Show off your passion. Tell why you're passionate. How you make difference? (Hint: this may take more than 140 characters.)

Unfortunately, I think lots of brands have gone backward in regard to social media. Social media strategy has become seek followers and lead the conversation rather than encourage and reward brand advocates who willingly and passionately lead. The obvious culprit is fear. Marketers fear an open dialogue about their brand (which exists regardless). Consequently, all that's left is an environment of commercial clutter and too many marketers on a hopeless quest to engage.

Can you think of any exceptions to this trend? There is one very notable one.

Thanks for reading, and as always, I look forward to your responses
. This post also appeared on Beneath the Brand.

Friday, November 5, 2010

Gettin'em Back

Is it me or are car dealerships are always good for a nice teaching point?

Some people already hate to go there to buy a new car. Then bringing the car back for service is worse. I'm feel the same.

I recently stopped taking my car back to the dealer because I was unhappy. Not with the work, the labor was fine. The customer service is what drove me away.

Thus, as a result of not dealing with customers well, they lost one. However, a good marketer knows that fixing mistakes is incredibly powerful and has tremendous value. If done correctly, it positively shifts a negative brand perception. Its a surprise and the customer also leaves with a nice story to tell.

So, when the dealership called on Friday, I was eager to listen.

Unfortunately, the damage was only compounded. They left an automated and poorly worded voicemail message. The representative quickly read through his lines: "we noticed that you missed many of your recommended scheduled maintenance appointments. Our experience has shown that..."

That what? A car needs regular maintenance: thanks.

Perhaps what their experience should show is that this dealership has such large masses of unhappy former customers that reaching all of them requires an automated message.

Most can see the folly in this thinking. In order to reach a large group efficiently, they must select a weak and inefficient tactic. In the long run, personally calling the smaller x number of customers per day would prove to be more efficient in winning back business.

Then the representative could find out what was wrong with the service, if anything. They could apologize, ask for forgiveness and start the process to improving the relationship with that customer. Not even the best script could do that.

There's a direct relationship in correcting mistakes. While the opportunity to send a positive message is elevated, so is the work necessary to do so.