Monthly Archives: May 2008

Duran Duran, luck and marketing

Simon LeBonAt one point during my college days I wanted to be an A&R guy for a record label.  My reactions to smoke-filled clubs and early-to-bed habits caused me to rethink that career option.

But music, and the marketing of it, has remained a lifelong interest.

Last night, my wife and I saw Duran Duran at Merriweather Post Pavilion in Columbia, MD.  This was her 11th or 12th time and my 10th time to see the band.

When you go to a Duran Duran show, you know you’re going to see a great performance, an enthusiastic crowd and hit after hit.

What I didn’t expect was a textbook example of creating and maximizing a marketing channel, and an example of how big a part luck plays in everything we do as marketers.

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An offer you can't refuse

1957 Dodge CoronetHow can you tell if an offer is good, i.e., is a strong consumer offer that makes money?

The answer is when the organization making the offer continues to use the offer.  The case in point is Chrysler’s “Let’s Refuel America” $2.99/gallon gasoline offer, which I wrote about recently.

The offer was supposed to expire in early June, but based on early results–including 25% more web traffic and a 34% increase in Internet leads–the promotion has been extended through July 7th.

Apparently Chrysler has re-crunched the numbers and found the financial results worth continuing making what’s turned out to be a very strong offer.  This is good news for the car buyer looking for a deal, the dealers who like the floor traffic and is good for Chrysler, as far as “moving the metal” goes.  (Overall, though, Chrysler is still in trouble.)

The takeaway is that Chrysler’s promotion has, once again, proven the old direct response maxim: If you want to dramatically increase your response, dramatically increase your offer.

When was the last time you looked at your offer? How might you reallocate your offer cost to create a more exciting offer that’s a true consumer benefit?
Creative Commons License photo credit: epicharmus

Make your mantra "make it easy"

Getting up close with my dinnerGuy Kawasaki, who is one of my favorite regular blog reads and speakers, is the author of The Art of the Start, which is a quick and worthwhile read for anybody thinking about starting up their own company.

One of the 10 things you should do, according to his book, is “Make Mantra.” I absolutely loved this, because it accurately describes what all truly innovative companies are doing and, more tellingly, what a lot of big companies are not doing.

I think that Papa John’s has “Made Mantra” with their focus on making it easy for the customer to order.  They’ve sold over $1 billion of pizza via their online ordering tools.  According to the CNN article, it’s just the start of likely dozens of new ways a Papa John’s customer can order.

Now that’s a mantra–make it easy to order.

So what are you doing to make it easy for your customer to buy more of your products?  Or more often? Or more efficiently?

Guy Kawasaki talking about “Make Mantra” is below.

Creative Commons License photo credit: ronnie44052

Step up your marketing

Octane Fitness Q37ce elliptical trainerIf you’ve gone through the hard work of developing physical products for customers, why not take advantage of the low-cost and free Web 2.0 tools available to help increase adoption of your product and reduce your sales cycle?

A perfect case in point is Octane Fitness and their line of elliptical trainers.

We were in the market for an elliptical trainer for about 6 months, when we finally pulled the trigger in early April on an Octane Q37ce trainer.  Since then, we’ve been extremely happy with the investment.  I’ve found that a six-day-a-week workout routine is easy to maintain and have seen marked improvements in my level of cardiovascular fitness.

So why did it take 6 months to purchase a product that I; a) really wanted; b) really needed; and c) is a terrific product that fits my needs exactly?

After reflecting for a month and doing some additional research, it’s clear that Octane could have cut the sales cycle down to under a month.  Here’s how. Continue reading

Seth Godin and common sense marketing

Purple CowSeth Godin and I have, unsurprisingly, a similar attitude toward marketing.  Compare, for example, his post What Do You Know? with my People Don’t… post of a few months ago.

Both basically remind the marketer that your “targets” (and this probably isn’t a great term) really don’t care about you and that the rules have changed in the Web 2.0 world.
Creative Commons License photo credit: psd

Free samples!

SamplingAre you using sampling in your marketing efforts?  Ad Age had a quick article on some of the sampling efforts being undertaken by major marketers this summer.

What’s old is new again.  Is it better to hit a prospect with 3 to 5 impressions and tell them about your product or is it better to put the product in their mouth or on their skin and show them how great it is?

If you think about it, the Web 2.0 technique of giving away your entire product dates back to the days of the local shopkeeper.  

Back in the day, the general store owner would give you a taste of what was in the barrel to get you to purchase the product.  Now, digital products and services providers allow you to use virtually all of their services free of charge, with the hope that you’ll come back repeatedly and purchase the premium (paid) product or generate pageviews to generate advertising revenue.

Sampling’s an old marketing technique, but it’s taken hold in Web 2.0 products and, with the advent of more granular tracking tools, is becoming more popular with traditional CPG.

As Winston Churchill once said, “The further back I look, the further forward I can see.”  What other “old” marketing techniques can you think of that can be resurrected in your marketing efforts?

Veto votes and brand dilution

Veto voting childGood marketing isn’t about chasing after the corner case–that last possible customer who might be buying from you, but who isn’t.

Overruling the veto vote to extend the reach of your brand often backfires.

Think of Starbucks and how they added breakfast sandwiches to the menu. It gave the customer who was considering a breakfast sandwich a reason to go to the local store instead of McDonalds.

The problem was that it made the stores smell lousy and more like McDonalds, which is a problem when you’re trying to sell $4 cups of coffee, a decidedly un-Golden Arches price point.

Thank goodness wisdom prevailed and Starbucks has gone back to their roots (coffee) and nixed the breakfast sandwiches.

Now Baskin-Robbins is making the same mistake and trying to solve for the Least Common Denominator by adding soft-serve to their menu. Now B-R is going to move away from what they’re known for (an interesting array of quality, scooped ice cream flavors) and start to compete with everybody in soft serve. So is Baskin-Robbins quality scooped ice cream or cheap soft-serve? My guess is the answer in the minds of consumers will be “neither.”

It’s always tempting to solve for the “veto vote” LCD or corner case to increase sales. Unless that’s done very carefully, it results in a widening of the target audience beyond what is reasonable, addition of vaguely related products and an “everything to all people” branding effort. Not a great place to be and, like Starbucks, you tend to find yourself focusing back on your core business after you’ve confused the customers.

Always focus on your core audience and core business and expand away from them only after very careful consideration.

One way to think about your core business and core audience is to ask the typical targeting questions in reverse. Ask “who isn’t in your target audience?” and “what don’t you do?” I find those questions are often answered more easily than the same question asked in the affirmative and with more clarity.

Summary and takeaways

  1. Be wary of “everything to everybody”. Trying to negate the “veto vote” or adding product features to address a corner case are warning signs. Tread lightly.
  2. Understand what you don’t do. It can help focus your marketing efforts on the right audience and right target markets and cause you to put aside distractions to your branding efforts.

What do you think? Will Baskin-Robbins succeed with soft serve ice cream? Are there other solutions to their growth problems?

Now that's an offer!

gas-pump-closeup-comp.jpgChrysler’s guaranteeing gas for your new vehicle will stay under $2.99/gallon for the next three years.

Talk about a great offer that addresses a couple of problems:

  1. Chrysler has too many large vehicles to sell, with lousy gas mileage.
  2. Gas at $3.00+/gallon is putting a crimp in the budgets of potential buyers, slowing down overall sales.

Rather than go the traditional route of putting cash on the hood of the trucks, in the form of rebates and/or lower interest rates, Chrysler whipped out the calculator. It doesn’t really matter where the “offer cost” goes from a P&L perspective (neglecting any GAAP requirements for the moment), but it does matter from the consumer’s psyche.

The glow of a low price on a 12 mpg truck fades pretty quickly when faced with $3 or $5 gas. Now the customer can at least put a cap on how much they’ll spend for gas over the next few years and take that worry out of the purchase equation.

Summary and takeaways

  1. Think creatively when developing incentives. Don’t restrict yourself to the traditional BOGO, “X% off”, “FREE X with purchase” offers. The more complex the purchase equation, such as a motor vehicle purchase, the more opportunities you have to create interesting offers.
  2. Use your calculator. Once you’ve got that great idea, make sure you do the math carefully. In the case of Chrysler’s offer, it could get expensive if gas rockets to $8/gallon. On the other hand, if it drops to $2, this could be one of the best offers of all time. (Assuming it helps sales.)

Don't move your billing forward to take advantage of the postal rate increase.

Penny Black postage stampIf you’re mailing Standard Rate, you’ve got until Friday to present your material for entry at the USPS at the current rates. I hope you’ve been getting ready to mail at the old rates.

Is there anything you shouldn’t try to get in the mail at this point?

I can think of a couple things.  While it’s temping to get your billing out under the current postage rates (typically by accelerating a few bill cycles from next week to this week), my test results have shown that it’s not usually worth it.

For every cycle you push into this week (using an example of daily billing cycles and 6 day-a-week payment processing) you reduce the time for the customer’s last payment to get into the billing run.

Believe it or not, a lot of customers wait for the last minute to send in payments and they have a very good sense of the time it takes for a payment to work through the USPS.  Customers have a sixth sense about their payment cycles and changes to that timing tends to create problems.

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Posts and comments from around the web

istock_000005779413medium-comp.jpgI was doing some SEO work this morning (and SEO will be the subject of a longer article in the near future) and happened to find a few articles where I was interviewed on topics ranging from membership to deploying analytic platforms using SAS software to education and internships.

Here’s a quick look at a few articles that might be of interest.

How important is membership to a non-profit organization? The Chronicle of Philanthropy did an article in 2005 about non-profit membership numbers and how the organizations count their supporters. It’s an interesting look on the philosophies that non-profits use. My takeaway and experience is that you should ask questions about an organizations membership and support numbers, especially if those are important to you.

I was really proud of the work I did with our CIO at WWF to upgrade our analytics capabilities using SAS. This article from the SAS user magazine has a few terrific examples of what Greg Smith and I were able to accomplish by moving aggressively to upgrade the organization’s analytic capabilities and improving our access to marketing data.

While I approach marketing from an analytic, direct response point of view, I also track brand marketing efforts to see if the principles of DR can be applied. KFC ran a promotion in late 2007 to encourage lunchtime visits to their stores by office workers. I gave it high marks for creativity, but was worried about the execution.

Finally, with college graduation approaching, I found this article at Utica College’s website where I was interviewed and offered thoughts on the importance of internships for college students.