From the marketing trenches...

How To Beat A Larger Competitor (You don't have to be the leader to lead.)

Once again Target is taking on the giant and winning.

The leader (Wal-Mart) is now becoming the follower. The NY Times today posted a story announcing Walmart.com is now hawking luxury goods:

"Walmart.com has broken through its own glass ceiling, selling high-priced platinum and diamond jewelry, cashmere sweaters and other goods designed to appeal more to the Tiffany crowd than to the bargain hunters who browse the company's terrestrial stores."

Target is winning the battle over the affluent shopper with their "cheap chic" strategy. And now the giant must compete on Target's playing field and adopt a me-too strategy. But this is unfamiliar ground for Wal-Mart (and their customers). Well designed products at a good price is Target's biggest strength.

Witness the power of creating your own playing field and forcing your competitors to play by your rules. (Rules that give you the advantage).

As I stated in my earlier post about creating your own playing field and changing the rules by which you and your competitor play... it's a lot easier to win when you change the rules in your favor.

Your Brand = Your Employees.

It is amazing how much focus and attention (and money) companies give the branding process (typically done with expensive consultants) and, yet, their employees are left clueless.

Aaron Dignan of Brandplay gives us a great example in a recent open letter to FedEx/Kinkos:

...THIRTY FIVE minutes later, a girl comes out from the back with our printout.  And guess what?  It's the wrong size.  We left irate, and Kinkos spent thirty five minutes to make ONE DOLLAR (which we got refunded). What happened during those thirty five minutes?  We watched seven customers approach the desk with different questions and challenges. Every single one of them left pissed off.  Come to think of it, I don't think I've ever seen anyone (customer or employee) truly happy to be at Kinkos.

So why can't companies with such immense resources get it right?

Because most marketers and branding agencies don't focus enough on the principal method a brand is presented to the marketplace...via the company's employees.

Great effort goes into planning and strategizing logos, ads, colors, tag lines, positioning statements and the like. In fact, most branding consultants create enough charts and graphs to make your eyes spin (or glaze over).

But if the guy at the counter taking the customer's money or the operator manning the phones at the call center doesn't live up to it...then it's all irrelevant.

And being "too big to pull it off" is no excuse. Hertz is a great example of that.

Every one of my Hertz experiences in every single city is evidence that a large company can get it right. Each Hertz employee I've encountered acts as if the company's mission is tattooed on his brain. (An even more amazing feat when you consider Hertz is owned by conglomerate Ford.)

It's not new information that internal branding is essential. Yet, surprisingly, it is where most companies (and their brands) fail. If employees don't live the brand...the brand will die a slow and painful (and now with blogs, a very public) death.

If employees don't live the brand all the expensive branding voo-doo in the world won't make it work.

5 Ways to Make Your Brand's Story Stand Out.

Welcome to the attraction economy. Where permission marketing is passe because, with attraction, customers now come to you. Where the currency of this new economy is emotion. And where stories are the fuel for this new economic engine.

This is all according to Kevin Roberts, CEO of ad firm Saatchi & Saatchi. In an appearance at last week's Ad:Tech conference he put it simply as:

"Reason leads to conclusions. Emotion leads to action. We're in the business of generating action."

Whether or not you buy into the idea of a shifting economy, one of "attraction", as a marketer you can't avoid the truth: we're in the business of generating action. And how do you emote someone to act in today's noisy, crowded marketplaces and our current world of information overload?

That's where Kevin's new currency comes in; storytelling. It was once easy to stand out as a good storyteller. The difference today lies in the mass quantities of information and stories competing for our attention. We need to filter out most of it in order to understand any of it. That's made us better judges of authenticity. We've all got pretty good B.S. detectors these days.

So how to make your story stand out?

1. Stand for something. And stand there. It's very tempting as a marketer to glob onto the next big "cool" thing. Or to instigate change. That's how we're wired. It's part of what makes us good at what we do. Drawing a line in the sand and saying this is what you stand for and not wavering makes your stories resonate. It makes your stories matter.
2. Involve your customers. Stories are much more powerful when told by those who live the experience.
3. Tell your story from "their" point of view. Too often, we marketers cast our company and product as the hero of the story. After all, it's our story, so shouldn't we be in the starring role? Actually, by putting your audience member as the main character, you've given them a stake in the game. Of course, your product is what makes them live happily ever after. But it's a story about them, not you.
4. Show more. Tell less. Think of your story as a children's book...there are more pictures than words. Engage both sides of your audience's brain.
5. And, most of all, you must be authentic.

John Moore, the brilliant proprietor of Brand Autopsy,  put this last point beautifully in a recent blog post:

"When working with clients, I stress the importance of TELLING THE STORY and not Making Up a Story. 

TELLING THE STORY is about designing marketing communications to deliver on the promise all the while being clever, savvy, authentic, and true to the brand. It’s about treating consumers as being interesting and interested."

Another whack in the head by Mr. Rushkoff.

Douglas Rushkoff has posted another excerpt and commentary on his upcoming business book, Get Back in the Box. This time he continues the conversation started on his blog about customers' involvement in the innovation process:

"...So here's a natural extension of the idea that the people we used to call "customers" are now in the lead, and should be welcomed into the process of innovation as equals...Those who are confident in their own core competency have nothing to fear from employees or customers with good ideas."

Amen! I think it's common wisdom you can't innovate in a vacuum. However, it's not common thinking you can't innovate without customers' input. I like to put it this way: Innovation is a team sport and your customers are on your team. My company learned this lesson earlier this year when we began inviting our customers to contribute in our innovation process (development of our product road map and strategic conversations about future areas of growth opportunities).

However, not everyone in our company was supportive, much less enthusiastic, about this approach. These detractors said things such as "customers don't really know what they want" and "they don't understand the true complexity of what we do".

I think this last statement veils a fear of open source collaboration. If our customers find out what is in the black box they won't need to pay us to provide our hocus-pocus. As one who has worked as a marketing executive in both large and small companies, I have experienced this attitude among marketing types to be prevalent.

As marketers, we often feel it is our duty to keep the curtain closed around our particular brand of Oz's wizard. To make what is being done behind the scenes seem so utterly complicated that a prospect would never consider finding out how to do it themselves and come to the conclusion they must buy it from us.

The simple fact, though, is people buy what they understand. Nobody wants to feel inadequate or looked upon as the village idiot for asking "that" question. When we as humans more or less "get it", we're much more apt to ask questions about the finer details. Thus, as marketers we have created the beginnings of a conversation with our prospects. And what better goal to have as marketers?

My company also learned the conversation, when extended into an open discussion around our company's thoughts on future innovation, is extremely valuable to both company and customer. Instead of it causing the customer to think about performing our service themselves, it has quite the opposite effect...they are actually more loyal customers because they now have a personal stake in the game.

If you can't beat 'em...change the rules.

Remember what it was like when you were playing a game as a kid and losing? Wouldn't it have been great if you could have called time out and then changed the rules?

No doubt, your older brother wouldn't let you get away with it in Monopoly. But you can get a way with it in business.

Let's say you're faced with a dominant competitor with considerably more resources than you. And you're losing the game.  What can you do?  First, here's something you shouldn't do: Don't try to level the playing field. Instead, create your own playing field. In short, change the rules. Here's a great example:

Target vs. Walmart
They don't make Goliaths any bigger than Walmart. The retail landscape is littered with those who tried to beat Walmart at their game. But Target was different. Target created a new playing field, we'll call it "Tar-zhay". On the Tar-zhay playing field, it isn't about the lowest price. It's about value-priced cool. And affordable chic. It's about good design for a good price.

So while Kmart, Montgomery Ward and others were trying to slay Goliath on Goliath's turf, Target was changing the playing field and, thus, changing the rules. We all watched what happened to both Kmart and Montgomery Ward. Target not only survived the confrontation with Goliath, they thrived.

Ok, so maybe you don't operate on a scale as large as Target. It can still be done. I know because we did it here at my company over the last two years...

Loyalty vs. Transportation
We took market share from the top 3 express companies (think Brown and their ilk). And we did it by changing the rules of the game.

We offer a service that handles returns for online and catalog retailers. Similar services are also offered by the other, much bigger, guys. We knew we had to change the rules. If we played by theirs, on their playing field (we'll call it "transportation"), we would get crushed.

So, we created a playing field that played to our strength. We'll call it "Loyalty". Our system was geared to do more than move return boxes to retailers. It also helped foster customer loyalty and increased the ability to retain customers...a huge metric in the retail world. We created an entirely new language for the world of retail returns to go along with our slightly, yet significantly different take. And it worked.

Now when our competitors walked into their prospect's office, they weren't asked for the lowest transportation price available. Instead they were asked questions such as: What can you do to boost my customer loyalty? How does your system help me retain my customers? Needless to say, our competitors could talk transportation and boxes all day long but weren't remotely prepared to talk about this stuff. These topics weren't covered in their rule book.

In a little over 2 years, we grabbed significant market share with over 80 retail brands using our service instead of the big three's.

Trust me, it's a lot easier to win when you change the rules in your favor.

From the inside looking...well...in.

The always dead-on John Moore recently distilled a systemic business problem while commenting on his Brand Autopsy blog about word-of-mouth marketing:

"The major reason why word-of-mouth hasn't taken off is not because marketers lack the metrics to measure it. It’s because most products, services, and businesses simply aren’t worth talking about."

Just chew on that for a while and you'll soon see just how brilliant a statement that is.  There's a new business book that helps explain what we in business can do about it.

Douglas Rushkoff gives business a whack in the head with his new book, Get Back In The Box.  To whit:

Too many companies are obsessed with window dressing because they're reluctant, no, afraid, to look at whatever it is they really do and evaluate it from the inside out. When things are down, CEOs turn to consultants and marketers to rethink, rebrand or repackage whatever it is they are selling, when they should be getting back on the factory floor, into the stores, or out to the research labs where their product is actually made, sold, or conceived.

I've worked as an executive in both Fortune 500 and midsized companies and this problem is prevalent within both. Who better knows your strengths and weaknesses than your own employees? Just ask...and they'll tell you.

It's equally important to ask your customers. My company recently invited 10 clients to our headquarters. We learned that we were doing a lot of things well. But we also learned where we were falling short and, most importantly, by sharing our vision of the future (including our product road map) we were able to receive true, unvarnished feedback. Adjustments were made. And we're glad we asked.

When looking in your own box, don't forget the customers that are in the box with you.

Word of mouth: Who are they anyway?

Olivier Blanchard hit it between the eyes today on his blog (brand builder) when commenting on Word of Mouth:

"It starts with the great product though. Always. No exceptions. That product can be a piece of software, a car, a bike helmet, a customer service department, a window display, a story, a photograph, an ad, whatever.

I can't tell you how many times I've bought stuff based on recommendations from people I trust. As a matter of fact, I hardly ever buy anything now without asking someone what they think of it. A new triathlon bike. A pair of running shoes. A digital camera. A movie ticket. A video game. A cell phone."

Brilliant! While most of us occasionally swim against the current, we typically rely on input from those we trust.

But, here's the thing. A lot of times we rely on input from those we don't know, much less trust. Or, we rely on dubious sources. Here's what I mean...When is the last time someone told you "...they say it's supposed to be good". Or "...they say it really works". I'm willing to bet you've not only heard and acted on such advice, you've passed it on yourself (I know I have). So, who is THEY? Why do THEY know so much and why do we listen to THEY if we don't even know who THEY are?

We are by nature social creatures. We want to fit in, get along, be a part of the crowd. Test this theory by watching any playground. Spot the inevitable kid being teased relentlessly by his playmates. He stays and takes it because it is better to be a part of something (even if painful) than to be alone and a part of nothing. That's where THEY come in.

Who is THEY? The answers are numerous...the press, bloggers, the kids at the local high school, marketers. THEY come in many forms. But it doesn't really matter where it started. We all still listen to them.

Think of the industry in which you market. Who is the THEY in your industry? An analyst, a certain magazine, or, god forbid, your competitor? Think about it and act before it's too late. Become the THEY in your industry. Or at least die trying.

P.S. In addition to Olivier, check out John Moore's blog Brand Autopsy for more brilliant commentary  on the Word of Mouth topic.

Pictures sell.

Kathy Sierra, coauthor of the Head First  book series totally hit the mark on her recent blog posting: Words + Pictures > Words. To whit:

And even seemingly simple ideas can take a lot more time to convey if you don't use pictures. We value our reader's time tremendously, and that's a big part of why we are so graphic-heavy.

How many boring, text heavy powerpoint presentations have you endured? Countless, I'm sure. I think most people inherently understand that pictures get the point across faster and more effectively than just words. So why the endless powerpoint copy? Simplicity scares people. Simple connotes unsophistication or simple-mindedness. After all, we read books with pictures when we were kids, right?

But nothing could be further from the truth. Simplicity creates an easier sell. It creates an instant "I get it" from your prospect and from there a dialog begins.

My company used simplistic imagery like the one at the top of this posting to build a "how we do it" poster. It was the most successful trade show we've ever experienced. People were intrigued by the illustration and had fun while tracing the life cycle of our product. And most of all, they got it. Quickly. And once they got it, they wanted to know more.

We oft hear of the pen and sword analogy. But nothing cuts through the clutter of the prospect's mind like a picture.

Ask your customers. Adjust. Repeat.

I've written several posts lately about my company's recent successful customer advisory group. We  learned some valuable lessons (some of them painful) and, as a result, our product roadmap looks much different today than it did the week before the customer meeting. In short, we're glad we asked. Not to mention the advice was free.

Here's another "listen to your customers" success story. This one is courtesy of Chiefmarketer.com. Profiled in this article is the online retailer, Bluefly. Bluefly went to their customer to find out what motivates them to buy from Bluefly. In the article, Bluefly's CEO is quoted as saying,

“It's clear that our customers want to talk with us,” Payner says, “and they felt they had a lot to say to us."

Indeed. Bluefly was overwhelmed with customer responses. The result was a hugely successful marketing campaign, based on what their customers told them they wanted to hear. Bluefly saw a 100% spike in traffic.

Our customers have a lot of valuable things to say. They just need the opportunity to do so.

More with less

It's that time of year when in-the-trenches marketers are asked to create a budget for 2006. And if your company is like most (and like mine) we are being asked to do more with as much or perhaps even less. Here are a few ideas we're doing this year that may spark a thought for you as you work on your own budget:

• Focus on PR. Stop advertising and let your customers do your talking for you. Prospects would much rather hear one of your customers talk about how you've helped them succeed. It means a hundred times more than anything you say yourself.
• Testimonials/Case Studies. In addition to PR, or even in place of it if you can't afford to pay a PR agency, is getting your customer to tell your story with their words through a case study or customer testimonial. This doesn't have to be anything fancy. Post quotes on your website or create a pdf and post it on your website or even just email it out to your prospects.
• Create a customer feedback group. This group will prove invaluable (and inexpensive) and will trump any expensive marketing research you do. This group can either meet in person, over the web, or even over the telephone 2-3 times per year.
• Create PDF's of all your collateral. Many prospects would rather have information emailed to them and it cuts your printing costs considerably.
• Communicate to your prospects via a newsletter. A quarterly newsletter is a very cost effective way to stay on the top of your prospect's mind. Create content about your industry in general, not just about your company. Interview authors or consultants in the industry...they're always looking for free publicity and it makes your newsletter content more relevant to your readers. Plus, it's a lot cheaper than direct mail.

Back to my budget...more ideas later.