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Posts from September 2011

Don’t Netflix It

Posted on  28 September 11  by 

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Internal CommunicationsAll right, Netflix has apologized to me, not just once, three times. Reed Hastings told me he “messed up” in an email last week, he also repeated himself in long form on the Netflix blog, then went on to deliver it face-to-face with colleague Andy Rendich on YouTube with a trashcan and service entrance in the background.

Being a customer, I wasn’t impressed, not because I believe Netflix has its strategy all wrong, but because they’ve missed a great opportunity. People pay attention to contrarian messages, but instead of delivering a brave statement about the future of media Netflix made many confusing statements. Saying something confusing in three different places won’t make it clearer.

If only this were simply a Netflix problem. Read More »

Three Reasons Your Customers Don’t Buy

Posted on  27 September 11  by 

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Stalled deals are becoming more and more of a reality for B2Bs these days.  We know customers are opening a few of our email newsletters and clicking through to the website (maybe even downloading a whitepaper or spec sheet).  Though they are delaying contact with Sales reps, customers do eventually engage, but then…nothing.  Customers who seemed like they were ready to buy hit the brakes.

Why does this happen?  Assuming they didn’t suddenly lose their budget or experience a major corporate shake-up, when customers don’t move forward it is because marketers haven’t convinced them that the proposed solution can deliver what they need.  I know that sounds simple, but effectively meeting customer needs is no easy task.  Oftentimes the problem is that marketers are too focused on who is buying (title, industry, geography) or what they are buying (technical specs, features, benefits), instead of why they are buying.  By the time customers are in the mid-funnel and beyond, their “whys” are more important than their “whats.”

Our research has uncovered three “whys” in particular that, when not properly diagnosed and addressed, can lead to a stall (or worse, a competitor being selected). Read More »

How Floor Staff Can Simplify the Retail Experience

Posted on  27 September 11  by 

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merchandisingIn a world of overflowing choice, shoppers get overwhelmed by purchase decisions.  Finding the right product can be even harder in-store than online, since you can’t filter by category or consumer ratings, for example.  Indeed, MLC’s recent research shows that consumers tend to find websites simpler than stores. And with foot traffic on the decline, simplifying the in-store experience is more important than ever to entice shoppers back into stores.  [For information on other ways to boost foot traffic, please see Courtney's recent post or shoot her an email.]

The simplest retail experiences involve staff who help you find the right products for your needs. But with high turnover, it can be hard for sales reps to learn different segments’ needs and product preferences.

What store staff need is a simple way to guess what customers want. Since preferences aren’t always visible, staff need a few quick questions for diagnosing needs – and the fewer the better (to avoid annoying customers).

In some ideal cases, a single question will be enough to send shoppers to the right section of the store.  One pet store, for instance, asks the question, “Do you buy your pet a Christmas present?”  This question alone helps determine whether to direct pet owners to the luxury section of the store or not.

Another great example of the single-question segmentation technique comes from a beer maker. To identify their target customers, they simply ask: “Do you like to get drunk quickly?”  An elegant segmentation technique indeed!

But finding those one or two questions that accurately predict shopper needs is no easy task. Most companies turn to their segmentation studies, but these are typically 100+ question surveys that can’t possibly be repeated in a store environment.

La-Z-Boy has solved this conundrum.  They reduced their 100-question segmentation survey down to just 2 simple diagnostic questions.  These 2 questions enable floor staff to predict which section of the store will be right for each shopper – with about 80% accuracy.

MLC members, learn more about La-Z-Boy’s in-store segmentation questions and learn how they came up with them.

Mobilizing Shoppers, One Smartphone at a Time

Posted on  27 September 11  by 

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mobile marketingGeneration Y is a hard crowd to please.  Being a Millenial myself, I know that our generation never stops demanding more from the world around us.  Over the past two decades, no part of our lives has ever been static.  Our music tracks blasted from cassettes, then CDs, then mp3s.   Our online chatter accelerated from dial-up to DSL to cable.  As students, we took notes on paper notebooks, then laptops, and now tablets.

Of course, few things are more important for a female Millenial than shopping.  Now I haven’t been the most ardent shopper amongst my friends and peers (and not just the ladies, mind you), but I have been an ardent observer of their passion.  From what I’ve personally noticed, shopping, too, underwent a layered transformation, one that is particularly significant to marketers. Read More »

4 Ways Energy & Utilities Companies can Beat Commoditization

This post was written by former colleague Andrew Kent of the Sales Executive Council. Visit the original here.

In my previous post, I argued that the conflict of interest between energy & utility companies and their customers makes these companies’ business models unsustainable. In short, the more efficiently customers use energy, the less money energy suppliers make—and customers won’t remain in the dark forever.

The solution, I believe, is to stop selling stuff (kilowatt-hours, therms, or joules) and start selling outcomes (light, heat, and motion). Indeed, one forward-thinking utility company recently shared with us their new Commercial Teaching pitch that focuses B2B customers on the money they could save from energy efficiency building retrofits, and off the price per kilowatt-hour.

It’s a compelling pitch, especially in deregulated markets. The customer saves money off its energy bill (the payback period is typically just 3-5 years), and the supplier picks up a new account.

But while energy investments make economic sense, customers have been surprisingly slow on the uptake, frequently rejecting energy projects that are in their economic self-interest.

For example, a contact in the green building industry warned me that most decision-makers are unreasonably skeptical of energy solutions, due to a lack of case studies proving they work, and the inherent difficulty with quantifying energy savings (i.e., external conditions may cause energy use to increase, even though that increase may be less than it would have been otherwise thanks to energy saving projects.).

Therefore, just as in any case when a customer is not thinking about its business properly, the burden falls on Sales to reframe how customers think about energy use. Read More »

Branding Strategies for the Holiday Season

brandingEven though the weather and leaves are just beginning to turn, and we still have to get through Columbus Day, Halloween and Thanksgiving before turning our thoughts to visions of sugarplums and eight crazy nights, marketers are hard at work figuring out ways to close the year off strong with a good holiday season.

But how should they do it, while stengthening their brand positions for the year to come? We’ve got a few tips below:

Find ways to lighten the load. For kids, the holiday season is a magical, wonderful time of presents, candy, and sometimes magical elves. For adults, though, it’s probably among the most stressful times of the year – even if the stress is likely to pay off in the form of fun with family and friends.

Great brands recognize that not only is the season particularly hectic, the very act of brand interaction might be, too. Finding ways to save consumers time and money, as well as raising the chances they’ll make the right choice when it comes to gifts, can pay dividends throughout the rest of the year.

So how does this play out practically? Offer your consumers some measures of assurance that they’re making the right choices. Some brands we’ve studied have done this through transparent buying guides – presenting consumers with a range of criteria and offering relevant gift ideas for each – while others have gone the technology route, using social networks to make gift recommendations.

Clarify the brand promise – and deliver it, 100%. There’s no better time to make sure brand promises are airtight – and delivery consistent – than the holidays. The uptick in shopping offers brands an opportunity to make a positive imprint on the consumer, but if crowd-weary shoppers aren’t satisfied with what they get, you may suffer the consequences the rest of the year.

MLC has a wealth of material designed to help companies consistently deliver their brand promises: for instance, here’s how Exxon Mobile motivated employees to consistent brand delivery, how Starbucks ensured consistent brand delivery across all touchpoints – human and not human, and how we recommend brands ensure consistent brand delivery across geographies and segments.

Find avenues of emotional differentiation. Here’s the place where brands – particularly consumer and retail brands – have a golden opportunity to set themselves apart from the competition: finding areas of shared values and ways to emotionally differentiate themselves from competitors. We’ve found, for instance, that brands that align with consumers around emotional values perform at a much higher level than brands that emphasize functional differentiators.

Luckily, emotions are running high during the holiday season, and there are a number of brands that have particularly strong associations with the holidays. Macy’s, for instance, is associated in my mind with the holidays: their sponsorship of the Thanksgiving Day parade and the movie “Miracle on 34th St.” form that association in my mind, and I’m much more likely to shop there during the holidays than at any other time.

Understand and fit into seasonal routines. Routines shift a bit during the holidays for a lot of people and families. I’d say that, on average, one is more likely to bake cookies on a random Tuesday night during December than in other months; one is more likely to visit a mall in December than in other times, one is more likely to drive around looking at tacky Christmas lights – all sorts of things.

Brands that unearth subtle shifts in consumer routines during the holidays can capitalize big on them. For instance: there’s the classic case of General Mills’ Betty Crocker brand figuring out that parents often spent the first week of the holidays doing nothing special, then felt guilty about doing so. So the brand targeted cookie-baking in the second week of the holidays, figuring this was an easy way to assuage parental guilt about not being festive enough.

MLC members, how are you shifting your brand communications mix for the holidays? Let us know in comments below.

All Worked Up About Mobile ROI

Posted on  21 September 11  by 

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Mobile MarketingI had the pleasure of attending Retail Advertising and Marketing Association’s CMO meeting here in DC last Thursday.  Conversation ranged from loyalty to simplifying consumer decisions (MLC presented this year’s B2C findings) to the growing economic divide in developed economy consumer populations (our friends from Iconoculture shared their insights on this topic).

But the most fireworks happened around a discussion on mobile marketing. Sean Bartlett, the director of mobile strategy & platforms at Lowe’s, presented on recent mobile activity by that company.  What they’ve accomplished is great mobile work for marketers to emulate. The new Lowe’s app, which has been on the top download boards in the App Store, scores very well against MLC’s 11 criteria of a world-class mobile execution.

Why the fireworks? One marketing leader in attendance asked a simple question: how does Lowe’s measure the ROI on its mobile efforts?  The assumption behind the question was that Lowe’s is spending well into six digits, or even seven digits, and so how to justify the resources internally?

(light fireworks here)  The discussion quickly bounced back and forth between various other retailers in the room, several of which stated that the ROI discussion is over—that was for 5 years ago.  Consumers are moving so quickly that it’s not a question of if, but how.  One retailer shared that it had just launched m-commerce the week before, and watched as its mobile sales ticked up to 3% of total–in just 3 days!!  The CMO indicated customers must have been wondering what took the retailer so long to offer mobile purchasing.

The discussion took on a life of its own, and ultimately landed in a place that struck me as a turning point for retail marketers—if you’re obsessed with ROI to the point that it’s hampering getting some big mobile bets up and running, you’re moving too slow for your consumer.  I’m sure there are exceptions in categories that serve older generations, but by and large, the mobile train has left the station.

MLC members, score your mobile concepts against world-class criteria using our Mobile Execution scorecard.

Boosting Retail Foot Traffic

Posted on  20 September 11  by 

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retail marketing(Our current research stream on in-store marketing for retailers and CPGs is on its way in a few months, and we’re looking for interested marketers to talk to about the topic! If you’re working on any in-store activations – shopper, mobile, etc. – please e-mail me and we’ll set up a time to chat!)

Last week, Target generated so much buzz that increased traffic shut down its website and some stores sold out of new merchandise within hours.  Surprisingly, this wasn’t a big Black Friday-style sale – it was the introduction of a new clothing line.

With e-commerce sites increasingly encroaching on bricks-and-mortar sales, retailers are being forced to innovate to keep consumers coming back to their stores.  From 2009 to 2010, e-commerce revenue increased 15.8%, while general merchandisers’ revenue increased 2.9% and department stores saw a revenue decrease of .8%.

A major factor in this shift to e-commerce is the rise of price transparency.  Before the rise of smartphones and price trackers, consumers would have to either go to many physical stores or leaf through many weekly circulars to know which stores offered the lowest prices.  Since both of these methods are incredibly time-consuming, though, consumers didn’t research the products and prices as much.  This gave retailers some wiggle room to offer slightly higher prices without alienating their shoppers.

But now, price trackers and smartphones abound.  Consumers are able to research products in-store, getting historical price information on sites like camelcamelcamel and finding cross-store location-based price information on sites like Goodzer.  And since so many shoppers have smartphones, they are now able to do this anywhere – even while standing in one retailer’s aisles, examining the product.

So what’s a retailer to do?

Make stores more of a destination experience.

One way to do this is to make the shopping experience incredibly fun, like I wrote about earlier about the American Girl Place or the World of Coca Cola.   Retailers are making their stores more novel by pursuing strategies like launching lines of unique merchandise (like Target’s Missoni example above), while others are hosting classes and events (like Home Depot’s Kids Workshops).  These unique products and classes can intrigue shoppers enough to get them into the store, and they will often buy more things once they are there.

Several retailers are also adding departments that feature products that can’t be or aren’t yet often purchased online.  For examples, health clinics can encourage shoppers to come to the store.  Since most visitors to a health clinic will pick up little things like cough drops and medicine on their way out, these health clinics can help increase both foot traffic and sales.  Groceries, too, can help increase foot traffic.  Since most grocery products have relatively short shelf lives, most consumers go shopping on a weekly basis, boosting foot traffic.

Use technology like mobile alerts and coupons.

New technologies like Shopkick can reward consumers for going into a store by providing points and coupons.  These points for checking in may be enough to actually get to the store, and the coupons may be enough to get them to buy more once they are there.

Take the store to the shoppers.

This summer, H&M successfully took its merchandise to the consumers by building a beachfront pop-up store that sold summer clothes and accessories, like shorts, swimsuits, and sundresses.  Shoppers were able to buy the beach gear and use it almost instantly.  This model increases foot traffic by significantly reducing the effort shoppers must exert to get to the store.

Other retailers are doing this by building smaller locations that cater to local shoppers.  This is taking the form of City Target, a store under construction that will be in a historic building to blend in with the nearby streetscape, and it will feature products like apartment furnishings to cater to neighborhood shoppers.

We have just begun our 2011 research on ways to boost foot traffic.  If have any ideas on how retailers should do this, please email me at colong@executiveboard.com to get involved!

5 Interesting Things You Can Buy in Japan

In western countries, economic and business history have interacted to create a certain kind of consumer environment – the people that buy your products have certain expectations and ideas as to how those products will work and what the buying experience will be like.

But it’s important to recognize that this history isn’t universal, consumer expectations and experiences are very different elsewhere, and stepping out of the context of your own market is an awesome way to generate innovation and growth.

Last year, we looked at the ways that western companies are repositioning and localizing their product mix for the growing Chinese market. It was a collection of very cool ways that companies incorporated local knowledge and preferences into their product and marketing efforts. But the land of even crazier consumer products is just across the East China Sea – Japan.

We collected five cool, unusual, or surprising things you can buy in Japan – hopefully these will jog your imagination a bit:

1) Odori-don

Odori-don is a Japanese word that means “dancing squid”, and it’s a dish that lives up to its name: a (very) fresh squid is placed atop a bowl of fish roe and steamed vegetables. When soy sauce is poured over the squid, the salt in the sauce activates still-live nerve endings in the squid’s tentacles – leading to the spectacle you see in the video above.

2) Mobile Television

In 2006, the Japanese government worked with broadcasters and mobile phone makers to create a broadcast standard capable of being streamed live to cell phones. It’s a little different than video on American phones: in the States, video is delivered over wireless data networks, and is typically downloaded first (although a few live-streaming services exist).

In Japan, videos is delivered over a network similar to free-to-air television in the States, resulting in better picture quality, less risk of dropped service, and a more…James Bondian viewing experience.

3) Robots. Everywhere

Remember the bit about economic history above? That’s a big reason why Japan, as a society, generally relies more on robots than other advanced countries: a very low birth rate, combined with a traditional resistance to immigration, has led to a bigger role for automation and robot workers.

Robots perform all sorts of roles in Japan: there are robots for cleaning up nuclear waste, robots for taking care of the elderly (although they don’t seem too popular), robots to help around the house, and even a robot suit that helps farmers work harder and faster.

4) Stuff from vending machines

Going along with Japan’s love of automation, vending machines occupy a central role in consumer life, particularly in big cities like Tokyo. Vending machines sell things like flowers, umbrellas, and even fresh eggs:

5) Fighting Obama toys

When President Obama was inaugurated in January 2009, Japan’s Gamu-Toys (link  in Japanese only) released an absurdly-detailed action figure of the new US leader. Complete with a machine gun, a pistol, two brightly colored ties (red and blue), and an outlandishly-oversized American flag, this cool figurine is ready to bring hope and change to the world – by force, if necessary.

4 Lessons from Great Tech Campaigns

Posted on  20 September 11  by 

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internet advertisingAt MLC we’re always scouting all things marketing. As I was reading through a list of top 100 global brands for 2010, published by brand agency Millward Brown, I couldn’t help but notice that 6 of the top 10 brands were from the technology industry. What has made technology brands such a runaway success? Are there any lessons in marketing strategy we could take from technology companies?

One could argue that technology has become omnipresent and all pervasive in our lives, and it’s natural that technology brands are likely to enjoy higher brand equity. On the flip side, technology brands also operate in an environment of fast paced competition, shortened product life cycles, and a lingering threat of obsolesce. The intense rivalry among technology companies today makes it ever harder for these companies to compete on product attributes – the conventional approach used earlier.

The question then arises, how can technology companies differentiate their marketing and stand out? I examined 4 successful global campaigns from the world of technology, and here is what we can learn from them:

Make it about the customer, not you: Technology companies may be tempted to over-emphasize the technical aspects, and superiority of their products. While this serves good fodder for the tech-geeks, the average buyer is often unimpressed. Through their More You campaign, Dell computers have helped buyers understand what their product can help them do. The practical approach has pushed up Dell’s brand perception to the top spot in the 18-34 year age group.

Ensure your tagline is what you really do: When recession hit, IBM suffered reduced business growth. Conventional technology marketing didn’t get the company new clients. Introspection of what the company really did, helped IBM come up with Let’s Create a Smarter Planet campaign, which reflected the business IBM was really in. The upfront value proposition had high resonance, and won the campaign a Gold Effie Award in 2010.

Empower the customer: Technology buyers may feel threatened and overwhelmed by the uses they can put the technology to. With its Power to You campaign, Vodafone lets customers take charge of their phone, and allows them the flexibility of designing their own experience on its network. Vodafone presents an empathetic human face to an essentially technical offering. In many markets, such as Ghana, the campaign won Vodafone new customers.

Transcreate (not translate): Apple’s simplistic messaging in all its campaigns has a universal appeal, ever wonder why? Definitely not for minimalistic jargon, and powerful use of simplistic imagery, but for using these in a way that connects the audience to it. Apple transcreates it’s messages, and not just translates them. Transcreation is a process of capturing the essence and spirit of a message, transforming it into one that is locally relevant and meaningful (see an Apple example here).

These campaigns would have never been possible without a strong global marketing organization. MLC members, our work on Structuring for Global Success provides guidance on organization design for global marketing success.