Business Inspiration for the New Year

January 5, 2009

As I was catching up on my RSS reading, two posts by Seth Godin and Fred Wilson really caught my attention as inspiration for the New Year.

In the first, Seth Godin posed the question, “Do ads work?” In particular, Seth is asking about digital ads where he feels the mindset of marketers should be “We have an unlimited budget for ads that work.”  In his own words:

Digital ads are different (or they should be). You should know cost per click and revenue per click and be able to make a smart guess about lifetime value of a click. And if that’s positive, buy, buy, buy.  And if you don’t know those things, why are you buying digital ads?

Seth goes on to give the example of Amazon during the Dot Com boom of the late ’90’s.  He says that during this time, the mantra at Amazon was $33. “They would buy unlimited ads, of any kind, as long as they generated new customers for $33 or less each.” Was $33 too high of a number to be sustainable?  Possibly.  But their internal ROI showed that $33 was the magic number and there was unlimited money to buy ads under that figure.

In other words, don’t use the excuse that you don’t have the budget.

Any idea that you have proven will build your sales and share should be invested in…and it should be invested in at the expense of ads that aren’t proven.

In the second thought-provoking post, Fred Wilson talked about creating a great business team in “Putting the Band Back Together.” Fred has noticed that as times get tough, many successful serial entrepreneurs are rejoining people they have worked with in the past.  Or as he puts it, “they are getting the band back together for awhile.”  Fred sees this as an encouraging sign because:

Teams that have worked together successfully before know the strengths and weaknesses of each other and they know how to get along, make hard decisions, and move the ball forward each and every day.

I think this is a brilliant insight and one that most businesses don’t think about often enough.  Think about your own brand team at work.  How long has the most junior person been on the team?  Or how long have the most senior members worked together?  What about your agency?  Have the same people been on the account as long as the Brand Manager or Marketing Director?  I’d be willing to bet that there has been considerable change over on both sides.

I think more brands need to follow the advice of Fred and “get the band back together.” 

If you have a successful brand and agency team, then practice continuity and keep them working together.

Business is a game of teamwork and it takes time to develop good working relationships.  In sports, All Star games are boring because the best players don’t practice together every day.  So when you throw them together, they don’t know how to work together.  Just look at what happened to the USA “Dream Team” in 2002 – 2004 when we lost to teams that had played together for years.

The same thing might be happening to your brand when you change the players every year.

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eMarketer: Facts and Numbers for Teens / Tweens

November 19, 2008

Over the weekend I had a chance to catch up on some of the recent eMarketer reports.  They have been releasing quite a bit around Teens / Tweens and technology.  In particular, their Kids & Teens Communication Revolutionaries provides some stellar information for any Brand Manager marketing to the youth market.  For instance, by 2012 US youth will be almost 1 out of 5 Internet users.

kids-and-teens-communication-revolutionaries-emarketer

Furthermore, this generation wants to communicate in different ways than older generations, with a much higher preference text messaging than e-mail.

digital-tactics-for-reaching-young-adults-emarketer

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Congratulations Motrin. You just proved why every brand needs to understand Social Media

November 16, 2008

Are you still trying to convince your management why your brand should be monitoring Social Media?  Well if you are a Consumer Packaged Good brand (or any brand really), just look at what happened to Motrin over the past couple of days and the reaction of Motrin Moms.

A simple search on Twitter of #motrinmoms will show you that they pissed off a lot of people with their latest ad around “babywearing.”  Mommy Bloggers are not people you want to mess with and you sure better understand the sandbox you are playing in if you do them wrong.  For instance, just look at this Consumer Generated Media that has already popped up in response.  Not exactly brand content you want at the top of search results.

The Lesson for Brand Managers:

Motrin screwed up.  It happens.  But in today’s world of Social Media, the place they really screwed up was in not monitoring what people were saying about the brand.  This PR disaster is happening underneath their nose and no one on the brand is responding.  Not their advertising agency, not their Public Relations group and not the brand itself.   The unfortunate fact is that company’s haven’t trained Brand Managers to respond quickly to situations like this.  That needs to change….and it needs to change fast.

People are going to be talking about your brand, with or without the Brand Manager‘s permission.  This simple fact is reason enough that you should be monitoring the conversations around your brand.  Motrin is just the latest brand to learn this lesson the hard way.

UPDATE – Well it looks like Motrin is trying to respond.  If you commented on their website, it looks like their VP of Marketing has a response that is being sent out (Thanks to Amy Gates for the lead).  And the Motrin.com site has been taken down for now, but thanks to the power of YouTube, you can still see the video at http://www.youtube.com/watch?v=BmykFKjNpdY (Thanks Bill Seaver)

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Five lessons on brand building from Jim Stengel, P&G’s former Chief Marketing Officer

October 20, 2008

Jim Stengel, former P&G CMO

Jim Stengel, P&G ex-CMO

This month, Jim Stengel officially retired as Chief Marketing Officer of Procter & Gamble.  As the leader of the largest spending marketing organization in the world, Jim was often named the most influential marketer and brand-builder in the industry.  Last week, he gave his final speech as P&G’s Chief Marketing Officer, speaking at the Association of National Advertisers Masters of Marketing conference in Orlando, FL.

Here is Mediapost’s summary of Stengel’s five lessons of brand building:

Lesson One: Put people at the center of all you do.

Treat your people the way you would want your customers treated. “We too often forget brands are people. It’s the collective intent of people behind them,” he says.

“I have learned in my career that the most important legacy is the impact you will have with the people you work with. We all have rough months, rough years, which blend together, but what you will remember is relationships and people.”

Lesson Two: Engage your heart and mind in everything you do.

Says Stengel, “We need balance. Too often as an industry we approach everything with head, not heart. We often talk within P&G of personal relationship as a metaphor for marketing. How many of us internalize that and apply it to how we approach business and customers?”

“If we thought about everything we do in marketing, if they all tried to emanate from this idea of great relationship we would do and measure things differently.”

He offered brands other than P&G’s as examples: Apple, Southwest Airlines, online shoe company Zappos, and Amazon.com. “What we find with the strongest brands is they have strength and competitive advantage in emotional areas that drive brand,” he said.

Lesson Three: Results.

“In our industry we tend to make things complicated, focusing on activities that don’t drive brand,” said Stengel. “Why are CMO tenures short? Look at organization designs across companies; they are all over the place Too much spend goes to short term and tactical that doesn’t build loyalty and relationship with consumers.”

He asked, rhetorically, why many CEO’s and CFO’s don’t value marketing. “Because too much we focus on a bustle of activities, not the few things that drive growth of brand. Sales are important but if you don’t look at other measures of brand health, you are being short sighted.”

Lesson Four: Creativity is about solving problems.

We too often have the wrong discussion with agencies. We talk fees, etc, short term stuff, not how to come together about how to create a powerful brand.”

Lesson Five: Have a purpose.

“I am devoting the next chapter of my life to this mission. He cautioned that, by purpose, he doesn’t mean cause-based marketing, but an inspirational, motivational reason for being. “For example, Nike’s purpose is to build self esteem, to be an inspiration for athletes around the world.”  The purpose of Pepperidge Farm Goldfish? “To bring optimism to children. Old Spice? To help guys navigate the seas of manhood,” he said.

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Stumble It!

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5 Principles to Your Best Action Plan Ever

September 29, 2008

Today’s guest post is written by Bryan Radtke, P&G’s Shopper Based Design Brand Manager, Bengals fan, and all around good guy.  Special thanks to him for picking up the slack on Hard Knox Life while I am out this week.

A few months ago I embarked on the annual painful journey that is fiscal year action plan development. The goal of this exercise is similar to many companies…put down on paper the stuff you are going to focus on for the next year, get your management buy in and sign off, and finally file it away, never looking at it again until next year. Yay! Time well spent.

I’m not sure if it’s my old age (I’m 29), the additional responsibility I’ve gained in the past year, or simply a new found passion for productivity, but what I hate more than anything is inefficient use of time. The Action Planning process definitely felt inefficient, so something had to change…and fast.

I decided to look at Action Planning for what it truly can be; a personal strategy to achieving your business goals. Excited yet? Didn’t think so.

Think about it this way. Businesses and organizations that succeed do so more often than not behind a solid, well thought out and executed strategy. Chances are if you are reading this you have a decent amount of ambition and would like to succeed in everything you do, including your career.

Think of your action plan as your personal strategy to that success.

If that didn’t hook you then try this. The unfortunate truth is no job is secure in today’s highly competitive business environment, and that includes your job. You need to earn your employer’s loyalty and bulletproof your career by communicating the unique points of difference and VALUE you bring to the table. The action plan becomes a personal compass to ensure you are:

  • Adding unique value
  • Elevating those around you
  • Demonstrating strategic thinking and ambition

Here are the 5 principles I followed: Read the rest of this entry »


Upcoming guest writers on Hard Knox Life

September 28, 2008
Cincinnati skyline

Image by joseph a via Flickr

Over the next week, I will be making the move to Cincinnati to start my new assignment in Procter & Gamble Corporate Marketing.  Since I haven’t yet mastered the art of mobile blogging, I have asked a few of my peers and closest friends to keep the fires the burning here at Hard Knox Life with a series of guest posts.  Special thanks in advance to these guys for lending a hand during the move.  I have a feeling you are really going to enjoy reading what they have to say:

Depending on how long it takes to get everything set up at the new home, I should up and running again by October 6.  In the meantime, these guys will do an amazing job of providing interesting reading and I should be relatively active on Twitter.

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Al Ries and I don’t see eye-to-eye on Megabrands

August 11, 2008

The 22 Immutable Laws of Branding by Al Ries is one of my favorite branding books out there.  In fact, it was one of the first books I read when I started full-time at P&G.  But though I generally have a ton of respect for Ries, I don’t see eye-to-eye with him in his latest AdAge article entitled “The Pitfalls of Megabranding.”

The reason is that Ries has the wrong definition of a “Megabrand”

Now let’s be clear; I agree with the basic premise of the article in that sku proliferation is a major problem in Consumer Packaged Goods.  Ries argues that brands are introducing too many flavor variations, such as the “11 flavors of Wheat Thins.”  These are more choices than a person needs, since they often just want the original flavor.  But that is a discussion for another post entirely.

What I want to point out is how Ries, one of the leading branding experts in the world, gets the concept of Megabrand wrong.  Here are the definitions that Ries uses for a Megabrand throughout the article, including how a “Megabrand” comes to be:

  • An innovative new product gets turned into a megabrand in a series of stages that can take decades.  
    • Stage 1: A company introduces a new brand that pioneers a new category. The brand stands for something specific and becomes red hot. 
    • Stage 2: No category can keep expanding forever. At some point, sales level off, so companies figure they need to do something to accelerate their growth, so they introduce line extensions.
    • Stage 3:After awhile, the numerous line extensions have undermined what the brand stands for. So the company decides to turn the extensions into brands and the brand into a “megabrand.”
  • “The whole idea of a megabrand is to strip the brand name of any actual meaning and turn it into a Paris Hilton. Famous for being famous.”

So the argument Ries makes is that a megabrand is a series of line extensions, including new flavors or skus within the core category, and that these extensions are done to provide “more choice.”  He even points out how P&G made a megabrand out of Olay and is doing it with Gillette at the moment. 

But I think Ries missed the mark on megabranding for two core reasons:

  1. Megabrands are not about new flavors, sizes or variants within the same category:  Ries is right about Goldfish, Wheat Thins and Gatorade having too many flavors.  But the fact these brands have multiple flavors and sizes within the same category is not a “pitfall of megabranding.”  A megabrand has nothing to do with having lots of sku’s….that is just about being a big brand with lots of sizes
  2. A megabrand is not about stripping the brand name of actual meaning…in fact it is just the opposite:   A Brand Manager can’t just wake up one day and say they are going to turn their brand into a megabrand.  It is a long process where you first have to create a distinctive equity and then you need to see what categories that equity would translate to.  Take Dove for instance, which proved the New York Times wrong when it emerged as a megabrand.  For years their bar soap stood for moisturizing.  They were able to extend that distinctive equity into deodorants, skin care and hair care because consumers gave them permission and believed in their equity.  And that is why Ries was right that Special K, Olay and Gillette are megabrands.  They have distinctive and ownable equites that can give them an unique position in categories they expand to.

Ries is generally dead-on with almost everything he writes about branding, positioning and marketing.  And he brings up a great debate when he says brands are bringing out new varieties just for the sake of new varieties.  But when it comes to saying that a meganbrand is just new flavors and line extensions without meaning, he is just plain wrong.