The best strategy for ad agencies in the recession is to anticipate and support their clients' likely desire to shift from brand-building to hard-sell advertising for the duration of the downturn. That's according to Nick Brien, speaking at Ad Age's Media Mavens Awards event. Brien is the CEO of Interpublic Group of Companies' Mediabrands, a unit designed to coordinate the holding company's media assets. Brien was formerly CEO of Univeral McCann, where he won wide recognition as a savvy corporate turnaround artist.
No doubt the economy will have an impact on just how consumers consume. According to RGE Monitor, the U.S. housing sector is still far from stabilizing. Housing starts keep plunging, and demand keeps following supply downward, resulting in inventories not getting worked off and remaining at record highs and placing even more downward pressure on home prices. The most recent Case-Shiller Index showed home prices are down 23% from the peak and the pace of decline keeps accelerating every month. The consensus is now that home prices have still a long way to go before reaching a bottom.
the housing market is central to Americans’ perception of wealth. But the wealth losses for households related to the decline in home values has already reached $3 trillion, and some estimates it will eventually reach the $6-8 trillion range. The loss represents a negative wealth effect of 6 cents on the dollar, and the reduction in personal consumption could amount to a whopping $500bn. Factor in the losses related to the decline in stock market prices, down 40% from its record-high on October 9th of last year, the lack of flowing credit, and the impending dark cloud of staggering unemployment and its easy to see why retailers expect holiday sales to plunge by almost 50% this year and extending the slump well into 2009.
Back in May, I wrote a short piece for some of our agency's clients that mentioned we’ve reached an “inflection point” where the credit-fueled, Boomer-led, 40-year American consumption binge is unsustainable. We live in a different world today than in 2007, and it’s permanent. Americans have no choice but to save, and we’re already beginning to see signs that they’re doing just that. In fact, the national savings rate has been ticking upward since midsummer 2007, coincident with the subprime meltdown.
This as a significant point of change as we undergo a generational shift in this country. Gen Xers, entering their prime earnings years, show little evidence of wishing to follow in the excessive paths of their Boomer elders. Rather, they seek balance, downsizing, for example, from Boomer McMansions. At the same time, Millennials are entering adult life saddled with an average of $20,000 of student loan debt, and are fired up to get out from under that burden.
A new era is upon us where consumer values of balance, thrift, savvy, responsibility, self-reliance and control are ascendant. We are entering an age when established, tried-and-true life strategies and maxims will make a roaring comeback: “Waste not, want not”; “A penny saved is a penny earned”; “Save for a rainy day”… It’s no coincidence that the last generation to practice such a sensible approach, those seniors who entered adulthood during the Great Depression, are generally in excellent financial condition.
Even in a downturned economy in which consumers will put a greater emphasis on saving, consumers will continue to spend. Clearly, there will always be a need for essentials like food, housing, or energy. But sanity is also an essential. Despite a recognized drop in “small indulgences” in the short term, consumer spending will happen in areas such as health-and-beauty products and services, televisions, or vacations. Yet when consumers do spend, they will want to save. Helping consumers easily identify the strength of a product or service's value proposition will rise to the top in almost every possible transaction, as the Dollars and Sense economy shapes a new generation of marketing and consumption.
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I currently work as the Director of Strategic Planning and Research at Richter7, the most creative and decorated agency in Salt Lake City, Utah.
Nov 26, 2008
Nov 24, 2008
In an industry that seems it can focus on little else but the changing media landscape, rarely have there been as many conflicting op-eds and articles on the subject as was the case this weekend. No one will argue that media habits of consumers are changing. But few can agree on just how they are changing, or what that holds for the future of the advertising industry.
The print industry has certainly been hit hard by evolving media consumption in recent years. The local Salt Lake newspapers were forced to overhaul not only their sales and editorial workforces, but also their content over the past year in response to declining revenues. Major magazines such as PC Magazine have moved to all-digital editions, while others have shuttered their operations entirely. Even the storied New York Times announced over the weekend it plans to slash its quarterly dividend by 74 percent amid a worsening advertising slump, further proof of the paper's declining influence.
As the Times scrambled to remain viable, the building that once served as its headquarters became home to the largest sign assembly in the history of Times Square. A digital display wraps all three sides of One Times Square, becoming the central landmark in America's most heavily trafficked outdoor advertising venue. The sign also guarantees its advertiser, Walgreen's, heavy exposure to more than 1 billion TV viewers as the backdrop to the New Year's Eve ball drop.
Digital marketing took a further step in its evolution over the weekend, as Dr. Pepper launched a consumer promotion that is being billed as one of the largest not only in video gaming but in the history professional sports. Dr Pepper will sponsor for the second year in a row Major League Gamer (MLG) websites by featuring an MLG gaming star player on more than 175 million 20-ounce bottles of the regular and Diet Dr Pepper, sponsoring the MLG's no. 1-ranked team "Str8 Rippin," sweepstakes codes inside bottle caps, a promotional site with bonus content, and in-store promotions.
Many consider emerging media as the future of the industry for its ability to better inform consumers and reach them on "their terms," a phrase used to the point of overkill in internal status and agency brainstorm meetings. Online video-game ads, blogs and text messages are gaining influence overall with consumers, especially the younger 18-34 demographic that makes so many marketers salivate. Recent statistics show that online video-game ads influenced 14% of electronics purchases among that group, while blogs influenced 11%, figures that outrank outdoor billboards and satellite radio. Text messaging is also gaining traction, influencing 9% of the demographics' electronics purchases and 6% of clothing purchases.
Then again, an IDC study released this morning concludes social network users are less receptive to advertising, and that the methods marketers have used to advertise through the medium are "stillborn" with lower than average ad effectiveness. Of all U.S. Internet users, only 3% are willing to allow publishers to use contact information for advertising. So much more effective than behavioral targeting can social advertising really be?
Confused yet? Well, the discombobulation was only furthered by two separate stories in AdWeek the past week. In one, the strength of online advertising to weather the deepening ad recession was touted in light of a recent IAB analysis that showed online ad spending approached $5.9 billion during the third quarter, the second-best quarter ever for the industry and an increase of 11 percent over the same frame in 2007 and up 2 percent versus Q2 of this year. But AdAge looked at the same statistics and highlighted how while spending in the sector up, it was slowing and flattening out. Four days later, the lead story on AdWeek now asks "Is the End Near for Display Ads?"
In today's discombobulated and frenetic media landscape, marketers scramble to find the best ways to reach consumers. Yet in an era when new media are prized, or at least often touted, Reckitt Benckiser, the most successful major package-goods company of the past five years in sales and profit, has outperformed the likes of L'Oreal, Unilever, and P&G with what AdAge calls a "contrarian strategy." So what was the media mix of this contrarian strategy? Reckitt decided to stick with the basics, spending nearly 90% of its media dollars on TV last year. While its internet advertising through the first half was already double its full-year internet spending in 2007, it was still only 1% of media spending.
Alexander Lacik, Reckitt's North American household-marketing chief, said the company will move quickly on digital marketing once it's been "qualified," and he couldn't even immediately recall the name of the company's digital agency. Ouch.
Nov 20, 2008
Executives from Detroit's "Big Three" automakers went to Capitol Hill yesterday to plead for $25 billion in emergency bailout money. First of all, I am fundamentally opposed to giving anything to anyone who files to Washington in their individual leer jet and begs for taxpayer money while their Gulfstreams idle on the tarmac.
Second, nobody has the right to uninterrupted growth and existence. Industries and businesses have to go through evolutions. Being good is the enemy of being great. All too often it breeds mediocrity and comfort doing the things the way they've always been done. But there is no such thing as entitlement or a birthright in business or marketing. There is no guarantee that you will be viable tomorrow, just because outdated ideas, strategies, tactics were successful before.
30 years ago, IBM was the leader in the growing field of personal computers. Then came around some company called Apple. Then Microsoft. By 1992, IBM was staring disaster in the face and posted what was at the time the largest single-year corporate loss in US history. So IBM innovated and reinvented themselves, moving away from components and hardware towards software and consulting services.
What has happened to Detroit should be a wake-up call to marketers everywhere. The current economic slowdown will separate the strong from the weak, the creative from the dull. Don't count on a bailout to make up for your inability to innovate and adapt.
Read Mitt Romney's and Seth Godin's comments about what should happen in Detroit.
Yesterday's post included an image meant to depict why some automakers have been able to better weather the severe downturn in the auto industry, while others are forced to go to DC to beg for money to survive. The image featured the logos of three brands who have successfully positioned themselves as outliers: BMW, VW, and Mini. I forgot to include perhaps the most successful outlier in the industry's recent history, the Scion.
Here is a clip from AdAge providing perhaps the best summary of Scion's tale, delivered by Jeffrey Rayport at the recent CTAM conference. Rayport encouraged automakers to rethink their relationships with consumers and empower them more, citing the way Scion's 2003 launch managers rethought every aspect of customer engagement.
Nov 19, 2008
Researchers and statisticians are always leery of statistical outliers, often removing them entirely from consideration when analyzing data. But while outliers may skew data results in statistical charts, outliers are where real change occurs in business and the real world.
The biggest movements and trends normally go mainstream but they rarely start there. Barack Obama was regarded as the most liberal Senator in D.C., began a movement that many considered as fringe, extreme, or radical, then grew it into mainstream politics. In business, change never occurs by doing the things that have always been done, or simply duplicating the strategies of others. Change, by definition, must be different, which means it always starts as an outlier.
Yesterday I forwarded to a colleague a website from a national hotel chain, which is taking a very unique, some may call it risky and extreme, approach in its positioning. My colleague dismissed it as "too far out there" to really be taken seriously. But as a marketer, one should always be paying attention to outliers. Some outlying cultural trends may at first glance seem radical, but always dismissing them will eventually only leave you trying to jump on a bandwagon you yourself may have been driving.
Nov 18, 2008
For those who are so afraid of needles that they avoid getting an annual flu shot, there may be a new tool to help you avoid getting sick.
Each week, millions of users around the world use Google and other search engines for online health information. As expected, there are more flu-related searches during flu season. But what Google has found is that there is a very close relationship between how many people search for flu-related topics and how many people actually have flu symptoms.
Counting the numbers of search queries is used to estimate how much flu is circulating in various regions of the United States. Compared against data from the U.S. Centers for Disease Control and Prevention, Google found using search data could accurately estimate current flu levels one to two weeks faster than published CDC reports.
Check it out here.
In the age of new media and TiVo, much has been discussed about the impending death of television advertising as we know it. Media companies have desperately searched for ways to more accurately measure viewership, and companies have struggled to realize the advertising power the medium once provided.
So while others sit back and complain about difficult market conditions and evolving media habits, some companies lead through innovative and creative thinking. Domino's Pizza announced a deal with TiVo yesterday that allows subscribers to place an order directly from their TV's connected TiVo box. The move broadens TiVo's content delivery system, which also allows subscribers to make purchases from Amazon.com or order movie tickets from Fandango.com.
This is just one example of how marketers are find new solutions to adapt to changing consumer needs and behaviors, made possible through the same digital technology that has eroded their advertising power in other media in recent years. Marketers can never settle into a comfort zone of simply duplicating last year's marketing plan. The business landscape is continually evolving, and marketers must learn to adapt or become irrelevant.
Nov 17, 2008
Apple is fascinating on so many levels. For marketers, few companies have mastered the art of branding as well as Apple. Apple has successfully captured the ever evolving aura of "cool" and attracted an extremely passionate and loyal base of customers from far and wide, part of the reason why Apple was named the "most successful world brand" and America's most admired company earlier this year.
A friend and devoted Apple fan told me yesterday of a conversation he had with a developer from Apple at this year's Worldwide Developers Conference. The developer told him that Apple makes it a point to not simply develop products based on what consumers want (chasing the puck), but build according to what consumers will want in the future (skating to the puck).
The philosophy results in truly innovative products that are first to market (controlling the puck), enhanced by design and packaging aesthetics, retail experiences, and opportunities for brand advocates to engage with the brand like WWDC and store openings that further advance Apple's religious following.
Over the weekend, Motrin made an attempt to go viral be placing the above ad on YouTube, aimed at moms at moms who carry their children in slings or backpacks. Almost immediately, moms everywhere took offense at the ad's condescending tone, which seems to imply that carrying your baby close has little effect and that moms that do so are really using their babies as fashion accessories.
Sure enough the ad managed to generate plenty of buzz, just not the kind Motrin's brand managers had hoped for. No sooner had the online legion of mommy bloggers seen the spot, they began to post angry comments on their own blogs, posting irate video responses to the ad on YouTube, even rejecting the ad en masse on Twitter. First rule in social media, beware the power of mommy bloggers.
Here are some screenshots to show just how much online activity the ad has caused, certainly now well beyond its intended audience. I mean, here I am a 28 year old male blogging about a Motrin ad targeted at moms!
It's shocking that Motrin's brand managers apparently failed to test the spot prior to its release, such strong emotions certainly would have been noticeable had they done so. But what made the situation even worse was Motrin's the slow response, indicating nobody was even monitoring the conversations people were having about their brand.
The ultimate demise of the campaign demonstrates either how quickly social media can galvanize a groundswell of opinion or how much power over online discourse they can give a few vocal tastemakers with outsize weight, and remind marketers of the dangers of trying to talk TO consumers through social media when its true power is in having a conversation WITH consumers.
That conversation shouldn't start only after you launch a microsite or release a viral ad, but should only be a continuation of an ever growing and evolving dialogue between brand and consumer. Consumers will always talk about your brand, and the trick for today's brand managers is to become an active part of and lead the conversation.
Great posts here from Seth Godin and David Armano about how Motrin failed a second time in its efforts to apologize. AdAge also released an excellent analysis of the campaign's demise.
Nov 14, 2008
In an interview with Brandweek, Sprint's SVP of Corporate Marketing Bill Morgan shared an interesting quote. When asked if Sprint's $99 Simply Everything plan, a flat fee for unlimited voice, text, and data, would lead to commoditization in the industry, Morgan responded, "It's kind of the old Wayne Gretzky thing, you're skating to where the puck's going not to where it's at."
The hockey analogy (or any sport for that matter) is fantastic. Is your company skating around the rink chasing a puck, or are you skating to where it's headed? Better yet, are you the one controlling where the puck will go?
Nov 13, 2008
Kaizen is a Japanese concept of improving productivity. It literally means “change” and “better," or changes of current methods to produce a better result. Toyota figured this out, and based their entire production system around it.
As humans, our natural tendency is to resist change. It brings risk. Instead, we like to maintain the status quo, keep things the way they are and too often settle into the comforts of our own mediocrity. In business, we build artificial walls to block cross-functional cooperation and resist the development of new strategies.
The Harvard Business Review published an article highlighting the efforts of some companies to develop collaborative Distributed Innovation Groups that take part in brainstorming and problem-solving sessions, identify customer needs that could lead to new offerings or business models, consider how to use existing technologies in new ways, scan the environment for emerging technologies and their applications, advise business units, and publicize promising innovations and ideas.
Change most often fails to occur not because there are systems in place to prevent it, but that there aren't any systems in place to begin with. Its a lack of organization and coordination. Find a leader. Be that leader. Unite individuals throughout an organization to seek out and implement the change the market is calling for. If you're not growing, you're dying.s
Nov 12, 2008
I'm not a NASCAR expert, but my son has become a fan ever since he first watched "Cars." As I watched the highlights of a recent race with him, I was intrigued by how the drivers remained in a tight pack for such a long stretch. Certainly there had to be some strategy, but I thought it was an awful lot like how so many businesses market themselves and their products.
All too often, we get placed into our position in the "competitive pack." Just as with the race, one company might move up a few slots, another might slide down, but for the most part, very little changes unless someone crashes or really screws up. Everyone seems to settle into their place and stays there. One driver eventually had enough, and came from the middle of the pack and raced to the front in a little less than one full lap. He was aggressive. He set the tone. He led, while others reacted.
Consider the election. Over the course of two months, John McCain's marketing messages were:
- Country first
- Don't listen to those ridiculous, un-American, liberal, intellectual, coastal elites
- Barack Obama is a superficial celebrity
- I'm experienced
- Obama is a dangerous unknown quantity
- Obama is a socialist.
Nov 11, 2008
A recent study showed that promotional "swag" is more effective than traditional advertising. Before you get too carried away with the findings, realize the study was commissioned by the Advertising Specialty Institute. That means the results are about as neutral as an internal tax audit at Enron.
If you have ever visited a trade show of any kind, you've noticed the number of people who go from booth to booth trying to collect as much swag as they can. But how many of them actually call the companies that gave them free stuff, hoping to do business with them? I doubt its very many. The effectiveness of promotional materials in and of themselves is limited. Swag can, however, help consumers remember the power of the (hopefully) positive memory of an experience they have had with your brand.
Perhaps the most essential part of developing a strong brand is creating the appropriate customer experience. All the advertising in the world will have little impact on someone who has had a poor experience with your brand. A brand's true power lives in the perception of the consumer, and nothing is as powerful on our own opinions about things in life as the personal experiences we have with them.
Nov 10, 2008
Another great visualization from David Armano showing the evolution of micro-media.
Nov 7, 2008
Not long after I blogged about how Obama could continue to use social media in his presidency, he has already started to do so. The Presidenct-Elect has set up a new website called change.gov, complete with a blog, multimedia, Obama's stance on issues and his political agenda, pages calling for Americans to "Share Your Story" and "Share Your Vision," and another page calling on Americans to serve in order to meet the nation’s challenges.
The bar on the right states: "The story of this campaign is your story. It is about the great things we can do when we come together around a common purpose. We want to hear your inspiring stories from the campaign and Election Day."
CBS News Science and Technology Correspondent Daniel Sieberg noted on The Early Show Friday that the online push went further than the candidates' personal Web sites, as both Mr. Obama and John McCain tapped into the newest forms of social interaction, from Facebook to MySpace, even text messages. Obama employed the Web to raise record amounts of money for a presidential campaign.
"A lot of elections have been won because of television appearances," Doug Jaeger, a Web designer for thehappycorp.com, told Sieberg. "How people are appearing on the Internet is becoming more and more important."
Mr. Obama must now shift from campaign mode to governing mode with his cyber-supporters, Sieberg points out.
"The Internet has changed the game dramatically," says Andrew Rasiej, founder of TechPresident.com. "It's as if, in 2004, the Internet was allowed into the conference room of politics; in 2006, it was allowed to sit at the table; but in 2008, it's sitting at the head of the table, holding the agenda."
Mr. Obama has said he'd like to appoint a chief technology officer, perhaps at the cabinet level, and he's made it clear he will embrace new technologies in office -- technologies such as Skype, a video tool Sieberg used to get this quote from John Tedesco, a Virginia Tech political communications professor: "(Mr.) Obama recognized that young voters are using social networking sites and social networking software, and he brought his campaign to the young voters online."
Ultimately, according to tech experts, the most important part of Mr. Obama's future strategy is to ensure his digital followers continue to feel empowered.
Says Rasiej, "We're going to see this online community become really the special interest of the Obama presidency. Not the lobbyists, not the people who've traditionally give money, but the people who actually know how to use these tools to make sure that their voices are heard."
Think of it, suggest Sieberg, as the 21st century equivalent of giving power to the people.
And, Sieberg says, there's a sense that people are going to become more deeply involved in local politics, from school boards to running for office themselves, as a result of this online empowerment.
UPDATE 11.24.08: Obama has appointed his Social Secretary, close friend and prominent Chicago businesswoman Desirée Rogers. A Washington Post article about her appointment points out "This appointment sends a strong message that the Obamas want to use the White House strategically, to maximize its use in a way that is consistent with their philosophy -- [to] open it to a broader range of people." The President-elect has also begun posting his weekly messages on YouTube, opting for the web iinstead of radio where Presidents have held their weekly addresses, starting with FDR's "fireside chats."
BusinessWeek has called this the first social media election. The impact that social media had on the election is undeniable, and should once and for all convince marketers everywhere of its legitimacy and effectiveness as a marketing tool. Not only does the internet allow voters to learn more about the candidates than we ever would have before, but it enables voters to broadcast their unfiltered thoughts and opinions to the world. Gone are the days when a democrat in Utah or republican in Massachusetts would have little outcome on an election. Now they can communicate with and influence the opinions of others around the country, forcing candidates and major parties to develop a truly national strategies as opposed to almost exclusively focusing on key battleground states.
With the earliest Obama Girl videos, questions asked of candidates in town hall meetings submitted via YouTube (which didn't even exist in the 2004 election), the viral spread of Tina Fey's impersonation of Sarah Palin on SNL, mash ups of candidate videos and logos, blogs, Twitter feeds, virtual Obama or McCain buttons on Facebook, embedded video in emails, and avatars crowded into election-related islands and parties awaiting election results in SecondLife, the election and marketing landscape is forever changed.
In my newfound obsession with marketing lessons from the election, particularly the role of social media, the question becomes: What will we see next? Can part of Obama's change also include a fundamental shift in the way a presidential administration interacts with the public, particularly the youth in America who in just a few short years will make up the single largest demo graphical voting bloc in the country?
Many criticized Obama for focusing almost exclusively on "hope." But hope is indeed a powerful emotion (look no further than the gushing emotion displayed in Grant Park Tuesday night). Through a continued commitment to the social web as president, the country's collective hope could be harvested and transformed into collective action. Here are some thoughts on ways the Obama administration could do just that.
Politicians have always had websites dedicated to their campaign, but few truly use the web as an effective tool once elected. On mybarackobama.com, Obama supporters could create a profile (complete with name, phone number, email and zip code), blog about their campaign experiences, track the latest campaign news and videos, plan, attend and discuss events, find other supporters, and help raise funds for his campaign. Most importantly, the Obama campaign has put supporters to work not as passive volunteers but as empowered organizers, with tools to find, convince and organize other supporters among their neighbors.
The current site whitehouse.gov provides information, but little opportunity to connect and communicate. Instead, turn mybarackobama.com into mywhitehouse.com to provide the public with direct contact and the opportunity to share ideas and organize in their communities to bring ideas to life.
Social web only works when it is transparent and consumer driven. In this case, allow the public to submit suggestions and feedback, and have a staff on hand that can respond thoughtfully to these submissions with more than a canned "Thank You" note. Whether the submitted queries be big or small, respond with the information the public needs to act and make the site a a true link from the public to the government.
The NSA has technology to monitor online chatter in blogs, forums, message boards, etc. Use this not only as a tool to root out criminal and terrorist activity, but harvest its true power as a direct source of public input. People express themselves most openly and honestly when an interviewer isn't asking them questions, so listen to what they are talking about with each other and respond accordingly.
progressive brands have found the best products often come when comsumers are at the helm of R&D and can co-create new products and services. How cool would it be if we could actually work with our elected officials to create legislation? Why should we only allow for public input and voting on election day? Social media can bring the public's voice to legislative creation and prioritization 365 days a year! Let us "Digg" up the issues we want addressed and make every day an opportunity to "vote."
A True Community Organizer
Think of how effective a financing strategy of gathering a large number of small donations was compared to seeking a small number if big donations. The campaign showed us repeatedly that organization at a grassroots level is often more effective than major national programs. There is the opportunity to greatly increase the overall amount of community service if the public can be enabled to contribute their time in smaller, more frequent ways.
While America was founded upon the principle of elected representation, its sovereignty lies with the people. My hope is that Obama continues to continue to show interest in the power of online technology and use it in his governing. Now that would be change we can all believe in.
Nov 6, 2008
Working with research as often as I do, I see a lot of numbers and have become very comfortable with Microsoft Excel. I doubt there's more than a handful of people at work who even know what a Macro is (and they all work in accounting). And as I try to find new ways to push the limits of Excel with insanely complicated formulas and massive spreadsheets, I never knew Excel could be so cool.
Check out the video below, which shows how AC/DC made their latest music video by combining old school ASCII-style art with a stat geeky spreadsheet, which can actually be downloaded an an Excel file from the band's website.
Since when did rock bands turn in their jeans and guitars for pocket protectors?
A few months ago I noticed an application on CNN.com that enabled readers to buy t-shirts carrying the website's headlines. CNN says the promotion was meant to build awareness of the CNN.com brand and drive traffic to the site. I will be the first to admit that I like t-shirts and have more than I could ever possibly wear, but I never quite understood the appeal of this promotion.
The $15 t-shirts just had a reprint of the story's headline along with the date and time it appeared. No cool design or graphic. No clever slogan, except for the two best selling headlines which had been "Colossal squid has soccer ball eyes" and "One in three office workers hung over." Apparently many people thought as I did, as only 2500 shirts were sold since the application launched five months ago.
That was until something truly newsworthy happened. Like an historic presidential election.
The election of Barack Obama sent Americans scrambling for keepsakes of the historic moment, including nearly 5,000 CNN t-shirts emblazoned with "Obama inspires historic victory." Under the headline is "I just saw it on CNN.com" and the time and date 11:04 p.m., 11-4-08. The interest resulted in almost $75,000 in sales, doubling the total from the first five months of the promotion.
Read the story here at AdWeek
Buy the t-shirt here
Nov 5, 2008
Nov 4, 2008
I took this picture as I was driving home on Tuesday, listening to election coverage on the radio. The sun was just setting behind the large snow-covered mountain to the west of our valley, illuminating the cloudy sky and the yellow fields that stretch as far as you can see. American flags lined the two lane road down the hillside and into the valley. The setting, eerily reminiscent of Obama's campaign logo, signified all that was right and beautiful about America.
I didn't vote for Obama, but in the end that isn't what mattered to me in that moment. Instead, what made the moment so memorable was the joy knowing that I had a right to vote, and that is what has made and will continue to make this country the greatest country in the world.
BBDO's relationship with its newest client, Starbucks, may have gotten off to a rough start. The agency, who was named the coffee chain's agency of record just a few weeks ago, turned around a quick campaign with online advertising and a 60-second commercial that aired during this past weekend's episode of "Saturday Night Live." The promotion offered to give free coffee on Election Day to anyone who comes into a Starbucks and says they voted.
Just one problem.
Washington state officials reached out to the Seattle-based java giant to notify the chain that state and federal election law prohibit any form of remuneration for voting. That means no free coffee to voters. Instead, Starbucks had to alter the promotion so that anyone, not just voters, could enjoy a free tall-coffee.
Starbucks has always been resistant to TV advertising. Now their new agency just spent a ton of money to advertise a promotion they couldn't do, and instead had to give away coffee all day long. That couldn't have been a pleasant client call.
Still not sure how similar election promotions at Krispy Kreme and Ben and Jerry's have fared.
I have planned on making a post this evening or first thing tomorrow discussing the lessons marketing managers could learn from this election. But then I failed to adhere to one of the first laws of marketing, don't let someone else beat you to market. Seth Godin had a brilliant post this morning about that very topic, so I thought I'd post his thoughts here.
I'll add some of my own thoughts and takeaways later this evening.
Stories really matter.More than a billion dollars spent, two 'products' that have very different features, and yet, when people look back at the election they will remember mavericky winking. You can say that's trivial. I'll say that it's human nature. Your product doesn't have features that are more important than the 'features' being discussed in this election, yet, like most marketers, you're obsessed with them. Forget it. The story is what people respond to.
Mainstream media isn't powerful because we have no other choices (see below). It's powerful because they're still really good at writing and spreading stories, stories we listen to and stories we believe.
TV is over. If people are interested, they'll watch. On their time (or their boss's time). They'll watch online, and spread the idea. You can't email a TV commercial to a friend, but you can definitely spread a YouTube video. The cycle of ads got shorter and shorter, and the most important ads were made for the web, not for TV. Your challenge isn't to scrape up enough money to buy TV time. Your challenge is to make video interesting enough that we'll choose to watch it and choose to share it.
Permission matters (though selfish marketers still burn it). The Republican party has a long tradition of smart direct mail tactics. Over the years, they've used them to aggressively outfundraise and outcampaign the Democrats. In this election cycle, smart marketers at the Obama campaign toned down the spam and turned up the permission. They worked relentlessly to build a list, and they took care of the list. They used metrics to track open rates and (at least until the end) appeared to avoid burning out the list with constant fundraising. Anticipated, personal and relevant messages will always outperform spam. Regardless of how it is delivered.
Marketing is tribal. This one, for obvious reasons, fascinated me this cycle.
Karl Rove and others before him were known for cultivating the 'base'. This was shorthand for a tribe of people with shared interests and vision (it included a number of conservatives and evangelicals). George W. Bush was able to get elected twice by embracing the base, by connecting them, by being one of them.
John McCain had a dilemma. He didn't particularly like the base nor did they like him. His initial strategy was not to lead this existing tribe, but to weave a new tribe. The idea was that independents and some Democrats, together with the traditional pre-Reagan core of the Republican party, would weave together a new centrist base.
Barack Obama also had a challenge. He knew that the traditional base for Democratic candidates wouldn't be sufficient to get him elected (it had failed John Kerry). So he too set out to weave a new tribe, a tribe that included progressives, the center, younger religious voters, weary veterans, internationalists, Nobel prize winners, black voters and others.
Building a new tribe (in marketing and in politics) is time consuming and risky and expensive. Both set out to do this.
Then, McCain made a momentous decision. He chose Sarah Palin, and did it for one huge reason: to embrace the Rove/Bush 'base'. To lead a tribe that was already there, but not yet his. He was hoping for a side effect, which was to attract Hillary Clinton's tribe, one that in that moment, was also leaderless.
Seen through the lens of tribes and marketing, this is a fascinating and risky event. Are people willing to suspend disbelief or suspicion and embrace a leader in order to maintain the energy of their tribe?
If it had worked, it would have been a master stroke. He would have solidified his base, grabbed key constituencies of Clinton supporters in swing states and wooed the center as well. Three tribes in one pick.
In McCain's case, it failed. His choice cost him the economically-concerned middle (which went to Obama's carefully woven tribe). And it clearly cost him the mostly female Clinton tribe. Yes, he energized the conservative base, but he lost the election. If he had chosen Mike Huckabee, one could wonder what would have happened. Would this less polarizing figure been able to collect a bigger tribe for him?
This is a real question for every marketer with an idea to sell. Do you find an existing tribe (Harley drivers, Manalo shoe buyers, frequent high-end restaurant diners) and try to co-opt them? Or do you try the more expensive and risky effort of building a brand new tribe? The good news is that if you succeed, you get a lot for your efforts. The bad news is that you're likely to fail.
Motivating the committed outperforms persuading the uncommitted. The unheralded success factor of Obama's campaign is the get out the vote effort. Every marketer can learn from this. It's easier (far easier) to motivate the slightly motivated than it is to argue with those that either ignore you or are predisposed to not like you.
Attack ads don't always work. There's a reason most product marketers don't use attack ads. All they do is suppress sales of your opponent, they don't help you. Since TV ads began, voter turnout has progressively decreased. That's because the goal of attack ads is to keep your opponent's voters from showing up. Both sides work to whittle down the other. In a winner-take-all game like a political election, this strategy is fine if it works.
So why didn't the ads work this time?
The tribe that Obama built identified with him. Attacking him was like attacking them. They took it personally, and their outrage led to more donations and bigger turnout. This is the lucky situation Apple finds itself in as well. Attacking an Apple product is like attacking an Apple user.
We get what we deserve. The lesson that society should take away about all marketing is a simple one. When you buy a product, you're also buying the marketing. Buy something from a phone telemarketer, you get more phone telemarketers, guaranteed. Buy a gas guzzler and they'll build more. Marketers are simple people... they make what sells. Our culture has purchased (and voted) itself into the place we are today.
Did I mention you should vote?
Nov 3, 2008
One of the more entertaining videos I've seen on YouTube in some time, changing the lyrics to match what is actually going on in the video! Long live Tears For Fears!
Seth Godin has another great post out this morning about the difference between reacting, responding, and initiating. Most employees in the business world today spend too little time initiating or creating change. We cross things off a to-do list rather than take the time to innovate. Yet, as marketers that is precisely the area we ought to be dedicating the most time to.
You can read the post on Seth's blog here.
Most knowledge workers spend their day doing one of three things:
- React (badly) to external situations
- Respond (well) to external inputs
- Initiate new events or ideas
Zig taught me the difference between the first two. When you react to a medication, that's a bad thing. When you respond to treatment, that's a plus.
So, think about your team or your front line staff or your CEO. Something happens in the outside world. An angry comment on Twitter or a disappointed passenger on your airline or a change in the stock price...
Do you react to it? How much of your time is spent reacting to what people say in meetings or emails?
The rest of your day may be spent responding. Responding to a request for proposal. Responding to a form in your inbox. Responding to emails or responding to status updates on Facebook. Responding is gratifying, because you go from having something to do ---> to having something done. There's a pile in a different spot on your desk at the end of the day. You responded to the needs of the tribe you lead, or you responded to password-change requests or you responded to the boss's punch list.
And that's it. You go home having done virtually nothing in the third bucket.
We tend to reserve the third bucket, initiate, for quiet times, good times, down times or desperate times. We wait until the inbox is empty or the new product lines are due (at which point the initiative is more of a response). It's possible to spend an entire day blogging and twittering and facebooking and never initiate a thing, just respond to what's coming in. It's possible to spend an entire day at P&G (actually it's possible to spend an entire career) doing nothing but responding...
Take a look at your Sent folder. Is it filled with subject lines that start with RE: ? Consider your job at the University--do you actively recruit people who don't even apply for professorships? What about your blog--does it start conversations or just continue them?
What did your brand or organization initiate today?
What did you initiate?
Think about the changes you'd have to make (uh oh, initiate) in your work day in order to dramatically change the quantity and scale of the initiatives you create.
Some marketing jobs are about responding. None are about reacting. The best ones are about initiating.