Archive for the ‘Marketing & Advertising’ Category
Today’s post was inspired by a series of interactions I had with VirginAmerica this week . Two lessons to be learned….
In one week, the family is headed to Southern California for a vacation. Although not as convenient and more expensive than flying out of Richmond, we decided (after standing up to considerable pressure from our daughter) to fly VirginAmerica from DC. Don’t tell her, but I’m looking forward to the experience.
Like all airlines, VirginAmerica has a rewards program. Theirs is called Elevate. Prior to purchasing our tickets in January, I joined the Elevate program. This past week, I received the following email from VirginAmerica:
You joined Elevate but have not flown us. That just won’t do. We want you to come and see what you’ve been missing, so here’s a special offer just for you – 30% off our lowest advertised fare on your flight with.
Now I love a good deal and this clearly is one, but there’s a big problem here. You see, I already bought tickets to fly with them, and I might add, didn’t get the 30% discount, so why doesn’t their Marketing department know that??? Companies that deliver a truly exceptional customer experience, do so consistently at every touchpoint. My expectations for VirginAmerica have been set high based on feedback from other customers and their advertising. That e-mail sent the message that they aren’t aware I’ve already booked flights. That is not what I would expect from a company focused on a great customer experience.
Lesson #1: Take advantage of the rich customer information you have at every touchpoint. Don’t send a solicitation that says “Hey, when are you going to buy my stuff” if I already have!
Twitter to the Rescue
Many companies have established a presence on Facebook and Twitter, but the ones that approach those communities as listeners and facilitators are the ones demonstrating that they get it. VirginAmerica (@VirginAmerica on Twitter) is one who gets it. This morning, I mentioned my frustration about the email experience in at “tweet” to Nick Schwartz, the guy behind the VirginAmerica Twitter presence. The response was almost immediate. He gave me his email address and asked me to send a note telling my story (in more than 140 characters), which I did. To be clear, I was not asking for nor did I have any expectations that my email would result in a fare reduction or other adjustment. I simply wanted to communicate an opportunity to inprove the customer experience. Nick passed my email up the chain and within an hour I got a reply from VirginAmerica Guest Care indicating they had forwarded my concerns to the marketing department.
I love the immediacy of being able to tap a company on the shoulder and start a conversation with out having to go to their place (i.e. website, 800#).
Lesson #2: If your company is participating in Social Media channels, take a lead from companies like VirginAmerica. Listen and Help first. The value that you deliver by doing that helps to strengthen your brand over time.
“Tennis is a ridiculously hard game, and there are a relative few who can, in the real world, reach pro status. Few of us can do much of anything well enough to attract real acclaim. But it’s a blast to try. And it’s even more fun to feel some pleasure of success from your efforts. To forget–even for a few foolish minutes–that you aren’t an uncoordinated undesirable left standing on the sidelines. That, instead, you are gifted. Talented. A winner on the court. The kind of person the captain picks first for the team.”
If you’ve played Wii Sports, you understand this and it got me thinking about why some experiences can trigger very passionate responses in people. Videogame designers have has evolved the medium from relatively simple (albeit fun) arcade style formats to realistic 3D-like environments with genres that appeal to sports enthusiasts, pilot wannabes and fantasy/role players. The Wii’s interactive controller design takes that to a new level allowing the player to use physical movements to control the game. This immersive experience puts the player on the court, field, fairway or in the case of the wildly successful Guitar Hero series, on the stage.
The question is whether or not these simulated experiences can motivate some players to try the real thing.
Beyond the numerous debates regarding the level of exercise a person gets playing Wii Sports, I haven’t seen any reports suggesting a game-inspired sporting goods sales surge, but Guitar Hero appears to be an altogether different tune.
Since its introduction on Playstation 2 in November 2005, Guitar Hero has spawned its own culture of fans and fanatics. Just check out the number of Guitar Hero videos on YouTube. The Guitar Hero series has been financially lucrative for Activision, the company behind the games. In April, 2008, Wired magazine reported that the franchise had sold 14 million units which equates to about US$1 billion in sales. Sensing an opportunity to tap into the passions of music enthusiasts following the initial launch of the game, music instrument retailer Guitar Center partnered with Activision to be the in-game virtual music store starting with Guitar Hero II. It appears their instincts were right as the musical instrument retailing industry has seen record year over year competitive store increases since the game was first introduced.
Guitar Center recently conducted a survey which “confirmed that the majority of those who play the games are more interested in picking up real instruments, it also revealed that most musicians who play the games use their real instruments more frequently as a result.”
Guitar Center’s move encouraged others in the music business to get their products into the game (literally). The latest versions of Guitar Hero are music marketing masterpieces with product placements by everything from bands to music publications and beyond. On a basic level, there is embedded advertising for products from leading manufacturers like Gibson, Mackie and JBL. These product and logo placements are both passive (a logo on the stage monitor) or active (play a Les Paul guitar). Beyond the direct music tie-ins are lifestyle placements from brands like Axe and Pontiac, and music publications like Guitar Player and Kerrang. From a content perspective, record labels have replaced the cover versions found on the original game with the real artist recordings. Players are exposed to new and “new to you” music. The more you play, the more new stuff you hear and you are more likely to listen to a song that you might otherwise turn off because you are interacting with it. The results are impressive:
- Sales of gear for first-timers at Guitar Center has surged. In the holiday selling season in the last quarter of 2007, Guitar Center saw a +20.7% jump in comparable store sales for beginner-level electric guitar & amplifiers. This surge grew even stronger through the first nine months of 2008, when Guitar Center’s cumulative comparable store sales for the category increased +26.9%.”
- Gibson said that it had seen sales on the rise, particularly those that are featured in the video games such as the iconic Les Paul guitar.
- Digital downloads of older and more obscure music featured in the game have increase dramatically.
So at its core, what is it about Guitar Hero that allows it to not only be a great piece of entertainment but also an effective marketing vehicle and an inspiration for some to take up real guitars?
It’s all about appealing to a lifestyle. Like the way Harley Davidson has figured out how to be a lifestyle company, Guitar Hero resonates with rock music Passionistas because it taps into that inner rockstar that so many have wanted to be at some point in their lives. It works because it gives players a taste of an experience that they want in a way that lets them forget–even for a few foolish minutes–that they can be more than just a fan in the audience. That, instead, you are gifted. Talented. A rocker on the stage. The kind of person who gets their face on the cover of Rolling Stone.
Do you have Passionistas as customers? Are you helping them to tap into their inner rockstar?
I started my professional career as a programmer with Circuit City in 1985 and I remember vividly how very cool a place it was to work. Not only were you part of a company that sold a cool product, but the organization treated people like family. On top of that, consumer electronics retailing was a specialty back then and Circuit City was the king of the mountain. There were many reasons for their dominance but the biggest was that for all intents and purposes, it was still a family business and the values that founders Sam Wurtzel and Alan Hecht built the business on were ingrained in the culture.
I’ll digress for a minute to share some very early Circuit City trivia as a way to convey how savvy a businessman Sam Wurtzel was. Bear with me, there is a reason for this detour. It was the summer of 1948 and Sam was driving his family to Florida for a vacation. Coming through Richmond, VA, Sam saw a billboard announcing that WTVR – “The South’s First Television Station” was on the air. Sam figured that with a TV station here, Richmonders were going to need a TV store. With that as his business idea, Sam rented out a corner of a Sears tire store and went into business selling TV’s door to door. The concept of Tryvertising has been talked about in recent years, but it’s basically how Sam approached selling TVs. He would deliver the TV on Tuesday and let customers keep it for a week to try it out, which of course meant that they got to see NBC’s hit Texaco Theater with Milton Berle on Tuesday nights. The following Tuesday, Sam was to pick up the TV, but not wanting to miss that evening’s Milton Berle show, most customers decided to purchase it instead. Simple idea, brilliant approach!
Sam and Al developed the WARDS TV business during the 1950’s. The “W” stood for Wurtzel and the “ARDS” were Sam’s kids’ initials. During the next three decades, several other store formats were experimented with. The name change accompanied a regional expansion and public stock offering in the 1980s. All along the way, Wurtzel, and later his son, Alan, built the business on the the 4-S Model: Service, Selection, Savings & Satisfaction, which was credited in Jim Collins’ 2001 classic “Good to Great” as the differentiator that allowed Circuit City shares to perform 18.5 better than the market between 1982 and 1997.
The 4-S model was the customer lens through which every “associate” viewed their work. Whether developing software or working on the sales floor, everything you did was about delivering those four S’s to the customer. Earlier this week, The Consumerist posted a video compilation of old Circuit City TV spots from the company’s heyday years of the late 80s and early 90s. The messages in these spots rang true then, but sound like empty promises a decade after the 4-S model was abandoned and management stopped focusing on what mattered – The Customer. The results speak for themselves. With a stock price now around $0.28 (yes, that’s 28 cents!) and likely to follow CompUSA into retail oblivion, it’s sad to think about how the leaders of this company were able to destroy it in just ten short years. The comments on The Consumerist post tell the story of how the brand is perceived today.
Take a walk down memory lane (if you’re old enough), and remember that you brand is not what you say it is, but rather what your customers say based on their experience with you.
Make a claim which is true only because of a small disclaimer. Then, repeated it to the point that people take it on face value. Its one of the oldest marketing ploys in the book and it’s what AT&T is doing with their “More Bars in More Places” campaign. You’ve seen them. TV ads that present a humorous situation, often based in the US, where someone isn’t receiving an important call because they don’t have AT&T. The disclaimer at the bottom clarifies that “More Bars in More Places than any other Network” is based on Global coverage. So yes, technically AT&T has more bars in more places, but does the target domestic audience really care that I can get AT&T Wireless coverage outside of the US. I don’t think so. Without the disclaimer, their domestic coverage does not live up to the claim. From Ad Age:
Consumers ‘equate bars with satisfaction and quality. It might work if people believe it.’ “Consumer Reports doesn’t. In its 2006 telecommunications survey, which was conducted last September and tallied the surveys of 42,000 readers, AT&T, formerly Cingular, had average or worse scores for dropped calls in the 20 cities it surveyed. As for ‘more bars’ or, as the Consumer Reports survey put it, no service,’ Cingular also was rated as average or worse in each city with the exception of Dallas, where it was rated better than average.
This campaign replaced the “Fewest Dropped Calls” campaign which ended last year. AT&T was unable to support that claim, even with a disclaimer. It seems AT&T has a history of using deceptive marketing tactics to make their product sound better than it really is.
As a customer of less than a year, I am constantly frustrated by seeing “No Service” on my phone in places that should (and according to AT&T’s coverage map, do) have coverage. Perhaps they should have another disclaimer that says “as long as you are not inside a building, like your house”! It’s bad enough that their service does not live up to expectations. What irks me the most is the frequent running of those TV spots which are clearly meant to put lipstick on a pig. Every time I see one of those ads, I feel compelled to requote the tagline, “No Bars in More Places than any other Network”.
When the 2007 holiday season kicked off a little over a month ago, US-based electronics retailer Circuit City introduced a series of TV commercials focusing on the simplicity of the digital lifestyle. With the ads, Circuit City introduces their latest moniker “Simplicity Guaranteed“. According to Circuit City’s Chief Marketing Officer, the new spots “illustrate how Circuit City makes it simple to Shop (on-line), Buy (in-store) and Enjoy (firedog services) your digital lifestyle this holiday season and beyond”. ”Simplicity Guaranteed” is the latest in a series catch phrases used by the retailer over the last few years. Previous slogans have included “Imagine That” (2000-2001), “We’re with You” (2001-2004), “Just What I Needed” (2004-April 2007) and “Circuit City Makes it Simple” (2005 Christmas Season)
All of these past slogans describe brand perceptions that Circuit City aspired to but failed to achieve. Why? Because a company’s brand is not defined by its catch phrase, logo, aesthetic style or culture. A company’s brand is ultimately defined by the experience they deliver to their customers and Circuit City has been unable to consistently deliver experiences that supported those brand promises.
The latest revival of the Simplicity theme is part of a larger strategic framework that I helped develop for Circuit City a few years ago (you can hear about it here). Making it Easy for customers to shop, buy and enjoy is one of the four key ingredients to the vision my team proposed. We also recognized that delivering experiences consistently supported the “Make it Easy” idea would require significant changes in processes, culture and internal success measurements. Almost two years after those recommendations were made, Circuit City has “re-branded” many of the same operational features that they have been touting for years with the “Simplicity Guaranteed” label, but has not done any of the heavy lifting required to support the long-term strategic vision of sustainable growth through exception customer experiences.
Marketing strategist Scott Glatstein suggests five steps for building a strong brand and optimizing customer experience:
- Identify your reasons to believe.
- Identify customer touchpoints.
- Determine the most influential touchpoints
- Design the optimal experience
- Align the organization to consistently deliver the optimal experience
Reasons to believe are those things that the customer experiences that support the brand promise. Circuit City has decided that Simplicity is one of their reasons to believe, but they have not executed any of the other steps suggested by Glatstein. Without those crucial components, the customer experience can easily fall short of the brand promise. Here’s an example:
We made the purchase and left, with tab in hand, for the local store. When we arrived, the iPod was waiting for us as promised, but there was no $15 iTunes card. Our concerns about the conflicting offers are validated and we are now entering confrontation zone.
We showed the tab to the customer service associate who wasn’t sure how to deal with the situation. Someone else was brought over to correct the problem. He suggested to “return” the web order and resell it to get the iTunes deal. The CSA did that, but in doing so, the price went back to the advertised price of $149.99. The CSA called the assistant back and the process of “fixing the order” began. At one point, we were told that we owed another $0.70. At another we were going to get $).09 back. Clearly, the front line associates; the ones that come face-to-face with the customers every day, are not prepared to deal with this problem. The processes have not been optimized to deliver a great experience.
With the line backing up behind us, the CSA team finally found a way to make deliver the transaction with the free iTunes card at the price advertised on the website. The total in-store transaction time was over 20 minutes. Our expectations were not met and the other customers in line behind us got to share our experience as well.
So did Circuit City satisfy their 24/24 guarantee. Technically, yes as the web order was ready in less than 24 minutes. Did the experience reflect “easy to shop, easy to buy”? Absolutely not! Circuit City has not identified and evaluated all of their touchpoints against the “Simplicity Guaranteed” reason to believe. They have not designed optimal customer experiences that include these touchpoints, and they have not aligned the various channels and business functions to deliver an optimal experience. This may sound like an isolated incident, but it is not. Where else is dealing with Circuit City not Simple? How about rebates, scheduling an in-home service or getting a product repaired under warranty if you didn’t buy the extended service plan?
Circuit City was once a retail powerhouse. They practically invented the “Specialty Superstore” concept. Today they are struggling to remain relevant in what has become a commodity market. They have to compete with mass marketers like Wal-Mart and Costco who can price aggressively, niche players like Gamestop and Verizon who can beat them at the “authenticity” game and web marketers like Amazon and eBay who can always deliver a better selection and competitive prices. At $4.62, their stock price is trading a 52-week low and is flirting with a 5-year low. Circuit City will have to find a way to build a truly differentiated brand if they are going to survive. Simply adopting a new slogan that says you “make it easy for me” isn’t going to cut it. They must also consistently deliver a customer experience that supports the claim. Without that, the slogan only serves to set expectations that won’t be met and further erode the brand.
Many of you may have shopped Circuit City in the past couple of months. I would love to hear about your experiences and your ideas regarding how Circuit City could improve the customer experience.
Earlier this week, I received an email offer from Enterprise Rent-A-Car. Too bad I couldn’t read it. It was sent to me in Spanish. Now I’ve supported Direct Marketing IT operations in the past, so I understand how this could have happened. Still, that doesn’t make it right. Companies who use direct marketing often walk a fine line between sending junk mail/spam and something that will be of value to the customer. The objective of course is to be highly accurate in the targeting to maximize response rate and minimize costs. Web-mail marketers don’t have the cost incentives that snail-mail marketers have, but they should still be vigilant to ensure that their marketing is, at a minimum, not an annoyance, and optimally, seen as something of value to the recipient.
In the case of Enterprise, I don’t know if just my record has been mistakenly updated to indicate a Spanish preference, or if this was a larger problem affecting many people. Apparently Enterprise either doesn’t know about it either or perhaps they do but don’t care enough about their customers to send a follow-up explaining what happened. Either way, it’s sloppy marketing and reflects poorly on their company.
With that as a backdrop, here are a few other annoyances that I’ve been meaning to whine about for some time now.
It’s bad enough that your monopoly (in my area) on highspeed internet access allows you to gouge me for your services, but when you send glossy, four color mailers to me every other day and usually send multiple copies (one for me and one for my wife), I have to wonder how much less I could be paying each month if I didn’t have to subsidize your highly inefficient marketing.
Geico must have one of the largest advertising budgets of any company. You can see their messaging everywhere from TV (multiple simultaneous campaigns) to banners flown behind crop dusters that fly up and down the Northern Outer Banks of NC and yes, I switched a year ago and I am saving 15% or more on my car insurance. So why do you keep sending direct mail pieces to me telling me to switch to Geico??? Do you not update your prospects list after people switch to you? Like with Comcast, I wonder how much more I could be saving if you stopped wasting money soliciting customers you already have.
Back in August, both my wife and I received notes from Capital One saying that they would be raising the rate on our cards to some outrageous figure north of 20% in 60 days. That was an effective campaign for their competition as we immediately took the “offer du jour” from one of the other 10 credit card companies that solicit us and transferred our balances to fixed low rate accounts. Perhaps that’s what Capital One wanted, but clearly, the message that I heard was that we were not valued customers. Of course, Capital One continued their weekly barrage with offers telling me I can get low interest loans and even transfer balances at a low fixed rate to our newly zeroed credit cards. They never did raise the rate on our cards and I have not used any of their services since.
I could go on with things like misspellings and blatantly wrong names, but you get the point. Whether big or small, companies that choose direct mail/webmail, must earn and maintain the respect of their valued customers and prospects. Here are some thoughts on that:
- Take the time to validate your campaign at critical points prior to release. Was the target group selected accurately and was that same group sent to the production house?
- Are you ensuring that your data is scrubbed and accurate. If you don’t care enough to get my name right, why should I consider your product or service? Are you sending things addressed to people who no longer live at my address? Does the rest of you operation lack the same attention to detail?
- If you are selling a service (like Geico or Comcast) stop sending solicitations once your prospect signs up with you. I know that the target lists are often selected weeks ahead of the actual mailing, but it’s pretty easy to insert a process to pull names from the list just before the pieces are generated by the production house. A couple of weeks overlap is OK, but much longer than that becomes annoying for me and costly for you.
- Ensure that the message you are sending in a marketing piece does not conflict with other messages, whether from marketing or other parts of your organization.
What are your direct marketing pet peeves and what suggestions do you have for direct marketers to help them earn and maintain the respect of their customers?
Apparently Enterprise became aware of their Spanish email problem. Today I received another email from the apologizing for their mistake and offering me a discount or upgrade on a future rental. Which reminds me of another takeaway:
- Make sure you monitor your campaigns to ensure that they execute as planned. When they don’t, as in the Enterprise case, make sure you follow-up with your customers with an apology.
Last week, I guest blogged over at Greg Verdino’s Marketing Blog and reprised a post that I had done here back in June on Niche Marketing. The central idea is that by targeting very specific groups who will relate to and find differentiation in your offering, you are no longer a commodity and you can increase your margins by charging a premium. Do this over and over with different products and services, and you can generate volume and growth that makes up for your narrow targets.
That doesn’t necessarily mean that you product or service has to appeal only to a narrow segment. Products with a very broad application can be marketed to very narrow groups by focusing on the things that that niche finds appealing.
Case in point: Toyota, who just release a new 30-second spot targeted at gamers. Shot in the on-line game, World of Warcraft, the spot is for the Tahoma pick-up truck, a product that appeals to an extremely wide array of customers. Toyota has released a couple of ads that convey the truck as being invincible. Last year there was one that depicted the truck escaping from the Loch Ness Monster. The new spot, which parodies the legendary WOW Leeroy Jenkins video, will have immediate appeal to WOW gamers.
If you aren’t familiar with WOW, you probably won’t get understand the spot’s appeal, but to gamers, it rocks! In just one day on YouTube, it had been viewed close to 400,000 times and word of the ad is spreading quickly through social networks.
Toyota isn’t the first brand to create a TV spot directed at WOW gamers. Coca-Cola China created a couple of WOW-themed ads last year, but this is the first US ad that I am aware of. It’s also the second gaming-related ad for a US brand in recent weeks. Southwest Airlines recently parodied widespread reports last year of Wii remotes being thrown into TVs by gamers whose wrist straps had failed – or who hadn’t used the wrist straps at all.
Both Southwest and Toyota have done something very smart here. I suspect that the typical gamer (early twenties, male) is in the sweetspot of the Tahoma’s target market. The same holds true for Southwest. By creating ads that speak directly to gamers, these brands will gain significantly more credibility with that niche market than with a generic ad.
What do you think? Is this an effective slant on Niche Marketing? What other niches groups could “mass brands” be more effective with?
My friend Greg Verdino is taking a little relaxing vacation at Walt Disney World this week. Greg didn’t want his blog to “go dark” for the week, so he asked some folks to guest blog in his absence. Greg always has great content and is focused on Marketing. I wanted to give him something that was thematically aligned, so my post is an updated version of one I did here a few months back. The subject is Niche Marketing and it should be posted on Monday.
I’m just the warm-up act. The guys that follow me are really great writers so be sure to go to Greg Verdino’s Marketing Blog every day this week to read posts from Ryan Karpeles, Jonathan Salem Baskin, & Matt Dickman.
Update: I’ve had some interesting responses to this post in the past week. A couple of interviews are scheduled and Geoff Livingston over at The Buzz Bin asked me to do a guest blogger recap which should come out this week. Thanks for your ideas and keep ‘em coming!!
Testing…. Testing… is this thing on?? Good! Every day, we hear about the power of social networks to…
- share new ideas
- make a difference through charity
- connect people with common interests
- enable long-distance collaboration
This is truly the Age of Conversation and there is much to talk about. Thanks to the social networks that I have been participating in over the last 18 months, I have “met” and had conversations with more interesting people from around the world than I ever imagined. As LinkedIn demonstrates, the real power comes the fact that the people in your network also have networks. I may have 100 friends but if each of them has 100 friends, then I potentially have 10,000 friends and this enables ideas to spread very quickly. Given that potential, I would like to take my extended network for a test drive to see what it can do.
A few weeks ago, I told you about a small IT consulting business called Impact Makers. Started by Michael Pirron, a Richmond, VA Social Entrepreneur, Impact Makers is “competitive social venture,” a for-profit business model with a nonprofit mission. The idea is simple -
Create a company that works to make profits, but instead of being based on maximizing shareholder value it’s based on maximizing community value.
To my knowledge, this is a new and unique business model. It is a nonstock corporation overseen by a volunteer board of directors. Its books are open to the public, its officers earn salaries but no equity, and all profits are donated to charitable partners. Those partners must be nonprofit organizations that meet four criteria: They must be secular, nonpolitical, local and have a philosophy of helping people help themselves. For its first charity, Impact Makers chose Safe Harbor, a Henrico County-based advocacy organization for victims of domestic violence.
Steal this business model, please!
While Pirron wants prove that the model works through Impact Makers, his larger objective is seeing the business model spread. He wants people to steal the idea, refine it, apply it to other types of business and create community value in as many places as possible. After writing about Impact Makers and connecting them with some of my readers who also participate in Social Entrepreneurship, Pirron asked if I would help with “marketing” the company’s business model and concepts through social media. In other words, get the “Conversation” started.
That’s where you, the people in my network, come in. I would like your help by suggesting ways to communicate the concept and by communicating it to people in your networks that might find it interesting or even actionable. There are lots of ways to get involved:
- Share the idea with people in your networks. Have a conversation about it.
- Interview Michael Pirron for your blog or podcast
- Connect Michael with other prominent bloggers/podcasters who focus on innovative business models or social causes
- Suggest ways to effectively communicate Impact Makers’ message to non-profits and academia
Get the idea? Take a look at my previous post and Impact Makers’ website for a quick overview of the company. Then use the comment box to let me know what you think. If you want to contact me for a “conversation”, my e-mail address is here.