Every day in every business a customer asks for something to which the business replies "no".
There are lots of reasons why that response might be valid and appropriate, but this post is about the value of understanding which questions were answered that way that should not have been!
That retailer should be tracking how many times someone asks for a water softener. That recruiter should keep track of how many times a job candidate is presented to them from an industry outside of the ones in which they specialize. That tracking will identify trends that could lead to product and service diversification that opens up new revenue streams!
Why bother? First of all, if you start selling water softeners when otherwise you didn't, you'll make more money! Second of all, and perhaps more importantly, if the market thinks you might sell something that you don't, you should. If it's perfectly reasonable for a customer to ask for it, you should sell it. Of course, if someone asks a car dealership if they sell waffle makers, that's not reasonable and not worth considering. But if the market requests it of you and it's a reasonable request based on the brand positioning you have established, your answer should be "yes".
The biggest question is whether or not a product or service would be (reasonably) expected of you by the marketplace ("Do my customers really expect that I would sell water softeners?"). The best way to determine what is expected of you is to listen when they ask!
LESSON FOR MARKETERS
Start keeping track of what people are asking for. It matters not what YOU think you should sell to the market, it matters what the MARKET believes you should sell.
Any examples of businesses that unexpectedly answered "no" to you?
Car and Driver wrote a very interesting article recently (via Road & Track) about the proliferation of 'crossover' vehicles in the market and specifically, crappy ones. Automakers so quickly responded to consumer demand for an enlarged station wagon that "considerations as varied as styling, performance, efficiency, and handling have been overlooked." In their opinion (and they would know) these products weren't well built, they were quickly built.
This begs the question: is it good or bad for your brand to launch a 'me too' product to capitalize on escalating demand if the product will be made too hastily and as a result, quite poorly?
Toyota is credited with starting this 'sport cute' trend with its popular RAV4 crossover. They are the real geniuses in this discussion because they identified the market need and created the first product to fulfil it. Others scrambled to keep up with the trend at the expense of product quality, which did some level of damage to their brand image. On the flip side, of course, is the brand damage that would have been done if an automaker forewent the timely introduction of a competitive product in the interest of perfecting it first.
Which is better? Launching an inferior, 'me too' product to merely keep up with competitors' offerings? Or, instead, dedicating resources to identifying the next market need and creating a product for that?
LESSON FOR MARKETERS
Think about your industry and your own product lineup. Are you in catch-up mode? Or are you in a market leadership position?
We know what the automakers ended up doing. Would you have done the same thing?
Today's consumers get exactly what they want, exactly when they want it.
Loyalty is all but dead because demanding consumers, powered by the internet and enabled by mobile devices, can always find... or should I say are continuously offered... the best offer at the best price. Today Blacks learned that lesson the hard way.
Consumers have immediate, detailed access to the best offers in the market. Consequently, innovators and startups with new products and new ideas are stealing customers and winning business.
What it means for established businesses (especially retailers like Blacks) is that they need to not only keep up with product development and new market offerings, they need to jump ahead and anticipate consumer needs before someone else does. In short, they need to give their consumers a reason to stay. They need to create that thing that no one else has.
To their credit, Blacks invested heavily 13 months ago in a rich rebranding effort that included a revamped logo, website, mobile app and store design. The problem, though, is that none of those things are unique. None of them would create any loyalty, which Blacks so desperately needed. The offer that came closest to something valuable enough to create loyalty was the mobile app, that allowed for prints and other photography-based products (like calendars) to be ordered and delivered. I'm sure you know where this is going...consumers already had apps just like that! What's worse is the length of time it took for the rebranding to fully reach the market. The refreshed store design didn't even happen in most stores before today's announcement.
The stark reality for Blacks is that they failed to create any compelling reason for today's high-maintenance consumers to stay.
So they left.
LESSON FOR MARKETERS:
This is perhaps the simplest, but yet most difficult, challenge for marketers. Create an offer than is unique enough and compelling enough to convince current customers to stay and prospective customers to switch. Much easier said than done, but if you can pull it off, prosperity awaits. Think iPod, RedBull, GoPro, Sharpie and Groupon.
What do you think happened to Blacks?
Target suffered the same fate for basically the same reason. Read about that here.
Today I noticed a new car on the road that I hadn't seen before. It looked awfully familiar but I noticed it was from Scion (owned by Toyota).
It's called the iQ.
I also noticed right away that it looks exactly (save for a few lines that are different) like the Smart car (owned by Daimler). Click to enlarge the image that shows the two cars together.
"C'mon!" is the thought that immediately followed in my head.
A car that looks exactly like the "Smart" car, and they call it the "iQ". Really? That's the best you can do??
LESSON FOR MARKETERS:
Come up with your own ideas!! *shouting*
Is it a clever move to capitalize on the success of a competitive product? Or is it a blatant copycat move that exposes their lack of creativity or originality?
Today's marketing 'fail' comes courtesy of Alliance Films, who released The Hunger Games on DVD yesterday.
When I opened the disc I was immediately impressed (I'll get to their failure in a minute). They obviously thought hard about how to convert fans of the movie into consumers of other products. They inserted an invitation to read two chapters of the next book in the series and and promo for Jennifer Lawrence's next movie, House at the End of the Street. They're catching the attention of both fans of the book and fans of the actress. "Well done", I say to myself.
I enthusiastically scanned the QR code to read the two chapters of the next book, and...
"We're sorry, this player is not enabled for HTML5 delivery".
The marketing team at Alliance worked so hard to capture the excitement of the moment and promote complementary products, and I was ready to praise them for their thoughtfulness and creativity.
Sadly, they forgot the most important part!
Now it may be that I don't have the appropriate technology on my phone, but I doubt it. I have an iPhone 4S and had just updated all my software. It's not an old, obscure device by any stretch. My worry is that they didn't adequately test the QR delivery on an iPhone!!! All that effort, wasted.
LESSON FOR MARKETERS:
Today it was announced that Ford enjoyed its 10th straight quarterly profit.
Here's what I love about that (from a marketing standpoint):
Back when the auto industry was getting absolutely destroyed by an economic meltdown and skyrocketing gas prices, North American auto manufacturers were clamouring for government bailout money to stay afloat. Ford said "No thank you. We're righting this ship on our own". And they did (obviously), by focusing on marketing. They shed superfluous and strategically misaligned products (some models, but also some brands including the atrocious Land Rover and Jaguar brands). They invested in advertising (with fairly high production values, I might add). They examined the wants and needs of their primary audience and designed products accordingly (the $16K, fuel-efficient Focus, as an example). From a marketing perspective, a pure focus on fundamentals and execution.
All that being said, I still hate them.
I've done my share of Ford-bashing over the years and they still haven't fixed their fundamental issue: poor quality. They're just not telling anyone about it. Read any worthwhile product quality review source (Consumer Reports is my favourite), and you'll find that Fords, quite simply, break down all the time. To combat this, they are simply preying on the ignorance of the uninformed through deceitful and arguably unethical advertising. First, they state repeatedly in advertising that "quality is now equal with Honda and Toyota". Well, if you actually read the fine print in those ads (yep, I'm that guy!), you discover that they're referencing "initial quality survey results". Essentially, they ask new Ford owners if they are happy. Of course they are - they just bought it! They also ask new Honda and Toyota purchasers the same question and get the same answer, leading to their claim of "equal" quality ratings. That's not even scratching the surface of the overall product quality issue. Second, they've started claiming a fuel-efficiency advantage with ads featuring Ford owners (actors) proudly (and repeatedly) stating that they "haven't bought gas in over a month". Well, as any informed viewer/purchaser can understand: if you don't drive, you don't need gas! Even my 8 year-old son chastised them about that (I'm not even making that up)! Ford, don't insult us by trying to deceive us. I am sad for the uninformed, who presumably didn't see through the advertising trickery and went ahead with their purchase.
You see why I am vexed so? I can't decide if I am impressed by their relentless focus on the fundamentals of marketing, or disgusted by their advertising deception and manipulation.
Blasphemy! How could I even suggest such a thing, right?
Hear me out.
I don't have a problem with fiscal responsibility. The problem is the math.
For years, business managers and marketers have been calculating Marketing ROI as a way to justify spending, staffing and other 'investments'. They've been creating metrics to measure such as calls to a dedicated phone number, coupon redemptions, new leads and more. Then, after comparing those metrics to the cost of the corresponding campaigns, they get a tidy ROI calculation that is used to evaluate marketing efforts and justify campaigns going forward.
Enter social media. The emergence of social media as a mission-critical marketing tactic (and investment) has given ROI heightened importance. And rightly so. Business owners want to be able to justify spending more time and money on a new (supplemental) marketing discipline, marketers are better able to measure 'return' (since most response can at least be observed, in the form of Retweets, Likes, and so on), and managers that don't quite yet see the value or importance of social media for business can at least see that it has a positive ROI.
So, we agree that the concept of validating effort and investment is worthwhile. My problem is assigning a mathematical calculation to marketing. It can't be measured. I should clarify: it's difficult if not impossible to measure response, let alone attribute that response to a specific, measurable investment.
Let me use some examples to illustrate my thought process.
Many marketers measure web traffic (and even online sales) against investment in email development for an email ROI calculation. Seems logical, right? Sure, but maybe some of those browsers / purchasers were more influenced by something like a friend's recommendation, and were merely inspired to buy by the email? That visit / purchase may not be directly attributable to the email alone. How is the investment in word-of-mouth, which happened much earlier, factored into the equation?
Another example: Many marketers measure Twitter Followers against the time invested in Twitter engagement for a Twitter ROI. Logical again. But there is also a correlation between the value of the content being tweeted and the number of Followers. How do you factor the genius of the person writing the tweets into the equation?
Another example: How do you even measure the return of a billboard campaign?
There are many other examples of ROI calculations that are first of all based on metrics that are hard to measure, and second of all not necessarily directly attributable to the tactic being measured. In legal circles it's comparable to circumstantial evidence.
So what's my solution?
Don't get me wrong, you should continue to care about ROI, but stop trying to calculate it mathematically. Instead think of it this way: "To what extent will this marketing tactic help me reach my objectives?" That's your 'return'. That thought process allows you to assign a grade or rating to the tactics accordingly. For example, if one of your objectives is to better manage your brand reputation, social media helps you achieve that objective to a great extent. Then, assign a measure of 'investment' to that tactic. Keeping with social media as the example, the monetary investment is $0, but the investment of time is considerable. So in this case, the 'return' is great, and the investment is 'considerable'. That's about the best you can do. The challenge then becomes comparing that tactic (social media) against other tactics to determine where you will direct your (presumably limited) resources (time and/or money). Are there tactics that help you achieve your objective(s) to a greater extent, with a less considerable investment of time and/or money? If so, do that first.
All of this is designed to help you understand where you should dedicate resources. That's the key to marketing management. There are lots of marketing tactics - all of them worthwhile. But for those businesses that don't have unlimited resources, you need to be choosy. You need to, as best you can, determine which marketing tactics deserve your investment. That's where this new way of thinking comes in.
Instead of ROI, I call it ETWTAOAITM: Extent To Which the Tactic Achieves the Objectives Against the Investment in Time and/or Money. The acronym sucks, I know. Hopefully the concept helps you make better marketing decisions!
Defend the ROI! Let me know why you still calculate an ROI for your marketing, other than because your boss makes you.
I am a marketing advisor. I spend most of my working hours helping businesses understand the marketing tools available to them and the relative cost (in terms of time and money) of each. I also talk to them about prioritizing the best ideas ahead of the good ideas, because no one has unlimited resources.
This one got my head shaking.
I have, on many occasions, endorsed the creation of hard-copy, offline (gasp!) catalogues that capture the power of photography, paper finishes and tangibility. It works. Especially for companies that offer high-end products.
What I don't get is using 615 pages (oversized no less) to do so. Granted, they sell a lot of products. 615 at least! But here are the issues that cause some concern:
THE LESSON FOR BUSINESS:
Tell me what I'm missing? The good people at Restoration Hardware are clearly doing most things right. Why, in your opinion, is this part of their marketing strategy?
This blog is written by Glenn Cressman, Share Of Marketing's founder and Chief Share Builder (bio). It covers all things marketing. Feel free to comment!