Marketing 101: Selecting An Overall Positioning Strategy - Value Proposition

There are buzz words and phrases in marketing & branding that seem to have an "aura" or "mystery" revolving around them.  There are also phrases and words that people who have careers in marketing don't understand at all.  One of the most used terms in existence is the Value Proposition.  Yet, so many of my colleagues don't really know what one is, or how to use it.  So let's spend some time defining it and exploring what it is and how you use it.

What Is A Value Proposition?
Simple question, right? Yet...it's a bit of a complicated answer. So if I'm going to define this as simply as possible, I'm going to say it like this: A Value Proposition is the full positioning of a brand, product or service.  If I were to expand on the definition, then I would say that a Value Proposition is the full mix of benefits that the brand, product, or service is differentiated and positioned upon.  A Value Proposition answers the question: "Why should I buy this?"

Above is a fairly standard illustration of the matrix of Value Propositions.  On the top, we have three Price categories: More, The Same, and Less.  On the side, we have three Benefits categories: More, The Same, and Less.  So when we assemble a Value Proposition, we are pairing a level of Benefit, with a level of Price.  For example, I may choose to take a More for the Same approach, meaning I'm going to offer more features and benefits than my competitors, for the same price.

The combinations in the matrix that are green represent the most favorable approaches to take with your Value Proposition.  Those in red are rarely profitable, and tend to lead to problems or a loss of focus down the road.

Let's begin exploring some of these categories of Value Proposition.

More For More
When we tout a "More For More" value proposition, we are telling the consumer that we are providing them the best possible product or service, and we are charging a higher (some would say "premium") price to cover the costs of giving you the "best".

In the real world, it is easy to see who the "More For More" players are.  One of my favorites is Apple.  They are not shy about "More For More". Apple gives you the best design, the best quality, the best experience, at a price that meets their corporate goals for gross margins and profits.  When a company truly stands behind this value proposition, giving the consumer a premium product, with premium service and an experience that is consistent over time (the Macintosh has been around for 30 years), then it can be very successful.

In order to compete in a "More For More" market segment, you are going to have to find a product or service category that is under-serviced.  If there is a void in the market segment for a premium product, and if the market segment has consumers that can afford a premium product, then you can consider moving in to that area.  However, there are cons to following a "More For More" value proposition.  When you have a premium product, there will always be imitators that will produce a similar product or service, and claim that it has the same quality for a lower price.  Amazon has been marketing it's Kindle Fire HD as a higher quality, lower priced alternative to Apple's iPad Air tablet.  "More For More" brands, products and services will always be under fire by those who use a "More For The Same" or "The Same For Less" value proposition.

More For The Same
How do you counter a "More For More" competitor?  You present a "More For The Same" value proposition.  A "More For The Same" value proposition entales offering a product, service or brand with comparable quality, at a lower price.  Depending on the costs associated with producing your product or service, you may have the same margins as a "More For More" competitor, or you have have smaller margins, which you are hoping to make up for with a higher volume of sales.

What does "More For The Same" look like in the marketplace?  The auto industry is a great example. Lexus, Infinity, Kia and Hyundai are perfect examples.  Lexus and Infinity were the first to attempt to uproot major luxury "More For More" brands such as Mercedes, BMW and Cadillac.  Offering more car, for the same (and usually lower price), these brands were able to take away more and more market share. As a result, Mercedes and BMW realized that there were more customers available at lower price points.  More recently, Hyundai and Kia have followed the same approach, introducing their Genesis and Cadenza models to the marketplace.  However, "More For The Same" can fail, if you are not backing up your value proposition with the quality and features that you claim you are providing the consumer.

The Same For Less
Probably the most powerful Value Proposition is "The Same For Less". Why?  Because we all love getting a great deal.  Great product?  Lower price?  Yes please!  Need a high quality PC for less?  Get a Dell.  Need great quality food, clothes, and electronics?  Go to Costco.  Want door busting deals on name brand electronics?  Go to Best Buy or Fry's Electronics.  Need name brand groceries for much less?  Go to Winco.  You get the idea.

Less For Much Less
If you remember my discussion of social and economic groups, then you know the reality of the consumer: few people want, need, or can even afford the very best products and services.  As a result, there will always be a market for value products.  "Less For Much Less" is summed up with a definition of "offering a brand, product, or service of less quality, for a lower price".   In most cases, the reality of a consumer's monthly budget forces a consumer to stick with "needs" over "wants" during the buyer decision process.

This means you are going to provide a lower "performing" product (less quality and features), at a much lower price.  This also means that you are usually relying on a higher volume of sales to make up for much lower margins.

More For Less
I'm going to briefly touch on one Value Propositional tactic that we see fairly often in the marketplace.  "More For Less".  That's what we all want, right?  More features, more product, more value, for a really low price.  We typically see "More For Less" when a new brand is entering a target market with established players.  Many claim to offer "More For Less" today.

At first it's easy to do.  You are ripe with new investment capital, or you are a large company that has just budgeted a large amount of money towards a new product segment. So you market your product, and sometimes sell it at a loss, offering more features, for a better price.  However, over time, it becomes very hard to maintain a "More For Less" value proposition.  Companies will typically fall into this trap: losing focus.  With each new generation of your product, you will add more features.  All of this product development, all of this marketing, costs money.  Lots of it.  And unless you have other products in your stable that are selling well and creating profits, you will have to raise the price of your product in order to cover the costs associated with bring it to market.  If you don't, you lose money.  Not only are you losing money, but your product and your brand become so "busy" and "cluttered", you begin to lose out to your competitors, who are more focused, and have a more focused product and message.  In essence, you eventually confuse your consumers, and once your prices go up, they look elsewhere during the buying decision process.  Stay away from "More For Less", unless you can keep your focus, and you can manage your bottom line.

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Marketing 101: The Buyer Decision Process: Evaluation of Alternatives

In my examination of the Buyer Decision Process, I've started by exploring the first two stages: Need Recognition and Information Search.  Need Recognition refers to the instance when a consumer recognizes that a need, or problem exists that needs to be satisfied, ie: I need a new refrigerator.  If the need is strong enough, an Information Search is usually initiated.  As a consumer does more research they will inevitably become aware of competing brands and products that are available for purchase.  It is at this point that the Evaluation of Alternatives begins.  An Evaluation of Alternatives is the stage of the buyer decision process in where a consumer uses the information gathered in the Information Search to evaluate alternative brands in the product category.

So how does a consumer choose among these alternatives?  The truth is that there are several processes at work inside the consumer's mind, forming beliefs and attitudes about all of the products to choose from.  However these processes all "evolve" based on the individual's buying situation.  The situation evolves from the set of attributes the consumer is choosing to evaluate products by.

Let's say a consumer is evaluating the attributes of a groups of computers. They have identified four attributes: performance, design, price, and value.  During the evaluation the consumer will place different levels of importance with each attribute based off of what is most important to them.  The consumer will "evaluate" each brand and form beliefs on how each brand rates on each attribute.  The consumer may turn to friends and family, consult consumer reviews, or discuss their situation with sales people during the Information Search.

We know that all brands vary in their degree of appeal to each consumer.  A consumer may buy a brand based on a single attribute, or a number of them.   If during the Information Search you were able to deduce how a consumer assigned value to each attribute you could predict the buying behavior more accurately.  Marketers must study buyers to discover how they actually evaluate brand alternatives.  If you know how your target customer's evaluation process occurs, you can take steps to influence the buying decision early on and lead the buyer to purchase much faster.

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Marketing 101: The Buyer Decision Process - Information Search

In my last posted I started to discuss the Buyer Decision Process.  Simply defined, it's conducted by a consumer before, during, and after the purchase of products and services. The process consists of five defined steps or stages that typically occur in a certain order: Need recognition > Information Search > Evaluation of Alternatives > Purchase Decision > Post-Purchase Behavior.

Need Recognition refers to the instance where a consumer recognizes that a need or problem exists that needs to be satisfied.  Need Recognition is usually triggered by an internal stimuli when a particular need, such as hunger or thirst, rises to a high enough level to become a drive.  Once the need has been identified and has become a drive, the pursuit of information begins.

Information Search
Information Search is the second stage of the buyer decision process.  In this stage consumers are driven (by their drive) to search for more information related to their need.  If the drive is strong and a satisfying product is near at hand, the consumer is likely to buy it then, barely collecting any information, or skipping this stage altogether.  If the drive is not strong, the consumer will usually store their need in memory and begin an information search.  As a consumer does more research they will inevitably become aware of competing brands and products that are available for purchase. 

Appliances are a product category where consumers conduct lots of research and there is ample competition.  Let's say a consumer needs to replace their refrigerator.  Because the most effective sources of information tend to be personal in nature, a consumer might start their information search by asking members of their friends and family social and cultural groups what refrigerators they would recommend.  Next, the consumer will typically begin to use commercial sources of information to "fill in the blanks", such as advertisements, editorial reviews, and in-store sales staff.

Marketers must design their marketing mix to make target customers aware of their brand in the midst of all of this "noise".  Ad messaging must address the typical needs, lifestyle aspirations and answer the common questions of their target demographics.  Sales staff must be properly trained and incentivized so that in-store touch points are as successful as possible.  If a marketing mix is properly created, it can help accelerate consumers quickly past the Evaluation of Alternatives stage and towards the Purchase Decision.


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Marketing 101: Variety Seeking Buying Behavior

In previous posts I examined Complex Buying Behavior, Dissonance-Reducing Buying Behavior, and Habitual Buying Behavior.  Finally, we will quickly define Variety Seeking Buying Behavior.

Variety Seeking Buying Behavior
Variety Seeking Buying Behavior refers to situations where there is low consumer involvement, but the consumer perceives significant differences between the brand options in front of them.  In variety seeking situations consumers tend to do a lot of brand switching.  There is no real brand loyalty.  Common variety seeking types of products are cookies and crackers.  Let's take a quick look at crackers.

Consumers may already have a few beliefs about crackers.  However most consumers will buy a particular brand with very little evaluation before the purchase.  In fact in product categories such as crackers, evaluation tends to happen during consumption of the product.  Beliefs and attitudes will come during the experience of eating them, or using them at parties.  The next time the consumer is ready to buy, they will sometimes buy the same brand if the experience was favorable.  However, they may also pick another brand purely out of boredom or to just try something different.  All of this happens for the sake of variety rather than any negative beliefs or attitudes about the cracker brand.
The marketing strategy might differ for the market leader versus the competitors trying to grab market share.  Leaders should encourage habitual buying - dominating shelf space and keeping shelves stocked, running frequent reminder advertising.

Marketers should encourage variety seekers to buy by using lower prices, special deals, coupons, samples, and ads that have messaging that give reasons for trying something new.

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Marketing 101: Dissonance-Reducing Buying Behavior

In my last post I examined Complex Buying Behavior.  Next, let's quickly dig into Dissonance-Reducing Buying Behavior.

Dissonance-Reducing Buying Behavior
Just like Complex Buying Behavior, consumers with Dissonance-Reducing Buying Behavior have high amounts of involvement.  However, buyers in this behavioral situation are perceiving very few differences among the brands they are selecting products from.  The key word here is perceiving.  There may be many real differences between the different brands, however the buyer's beliefs about the other brands are that there are very similar or essentially the same.  Let's examine a common product such as paint.

Choosing paint for the interior of your house is an extremely expressive process.  The colors a person may choose are varied and will always vary from person to person depending on their highly personal tastes.  Paint can also be expensive, with some brands costing over $20 per gallon.  When a consumer finds a group of brands in a determined price range, their understanding of the difference between brands may be very low.  As a result, a consumer may do some research, but in the end, they may be swayed by price or convenience of purchase in the end.

Post-Purchase Dissonance
Post-Purchase Dissonance is another way to say "after the sale discomfort".  It's also the on-set of "buyer's remorse".  Post-Purchase Dissonance will begin once a consumer begins to "notice" any disadvantages of their purchase, and begin to hear "good" things about the other products they did not buy.  To counter these feelings, marketers should be running after-sale communication campaigns with focused targeted messaging.  These campaigns should give encouragement and help support consumers, convincing them to continue to "feel good" about their brand choice.  These marketing campaigns should also be encouraging additional purchases or referrals, offering discounts and incentives for additional purchasing.

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Marketing 101: Primary Data - Contact Methods

In my last Marketing 101 piece, I spent some time introducing the Research Methods that we typically use in Primary Data collection.  Remember that Research Methods consist of surveys, experimentation and observation.  Surveys are the workhorse of Primary Data collection.  They tend to give us the bulk of our information related to customer trends and buying behaviors.  In order to conduct these surveys, information is collected in a variety of manners.  Typically these Contact Methods include mail, telephone, focus groups, and various other online technologies.

Mail
The mailed questionnaire is a classic primary data collection method.  It is very valuable, because it can be used to collect massive amounts of primary data for a very low cost per respondent.  We're talking the cost of paper and postage.  (Remember that you do need to calculate the labor costs of crafting the survey and processing the data once it comes back to you)  The data that you can collect from mail methods is usually considered very good for a few reasons.  First, there is little chance for "interviewer bias", because there is no live person there to ask the questions in a manner that could influence a person to respond in a manner different than they normally would.  Second, because they are not being interviewed in person, the respondents are usually more willing to give more honest responses.  And third, because you are not relying on the interviewer to record responses, no interviewer bias is introduced to the answers.  

However there are downsides to using mail as a contact method.  First, mail-based surveying is not very flexible, because all respondents are required to approach their surveys in the same way.  Second,  collecting primary data via mail is very slow.  It can take months before a reasonable amount of your sample sends the questionnaires back to you for processing.  Third, because written surveys usually take longer to complete, the response rate trends lower - simply because it takes more work.  The response rate is actually considred to be very fair.  It's harder to control the sample, beacuse you don't know which households will respond, let alone who at the residence will respond. 

Telephone
Telephone has always been a fairly good method of collecting Primary Data.  First, it is possible to collect massive amounts of data very quickly by using multiple people at the same time to call and conduct phone interviews everyday.  Second, telephone interviews allow for more flexibility, because your interviewers have the opportunity to provide clarity about any questions that respondents don't understand.  Third, you have excellent control of the sample, because interviewers can screen out callers before an interview is conducted. Fourth, with the right incentives, typically the response rate is actually very good.  

There are problems with collecting Primary Data via telephone as well.  First, the quality of the data you collect can only be considered fair at times, because the interviewer can inadvertently introduce bias into the answers based on how the questions are asked.  Second, because the respondents are interacting with a live person, they may not want to provide completely honest answers to questions that they may consider too private.  Third, telephone surveys are more expensive, because they require more labor.

Focus Groups
Focus Groups are a Primary Data collection standard.  Focus Groups have become a leading method for gaining valuable insight into consumer thoughts and feelings and their buying behaviors.  Traditionally focus groups consist of a moderator leading six to ten people.  However technology has allowed focus groups to be conducted through video conferencing and webinars via the internet, which allows people from different locations to be connected together which can improve sampling. These groups will participate in discussions about products, advertisements, services, and even organizations.  The focus group attendees are usually paid a small sum for attending.  The moderator will attempt to lead an easy and free flowing discussion hoping that free honest responses will be given.  Data is usually recorded by the moderator, however sometimes focus groups are observed by staff members via cameras or through one-way windows.  

Focus groups also have their issues.  First, focus groups use much smaller sample sizes in order to control cost and keep their sizes manageable.  Second, because sample sizes are so small, it is hard to reliably statistically generalize the results.  Third, attendees of focus groups are not always candid and honest.  The phyiscal and sociological environment of the focus group can create peer pressure, which leads attendees to alter their results in order to "fit in" with the people surrounding them. This is being combated by using environments that are relevant to the products and services being studied in order to get more relevant and open responses.  Fourth, focus groups cost much much more to conduct due to the costs of time, labor, location, and data acquisition.  Only use focus groups when it is appropriate and you are looking for specific types of data that you cannot reliably acquire with other Contact Methods.

Online Methods
The internet has single-handedly changed the Primary Data landscape.  Researchers are no longer confined to using mail, telephone, or physically location-bound focus groups.  There are many electronic alternatives to all three primary contact methods.

Email surveys and survey research websites are very affordable alternatives to direct mail and telephone interviews.  Because they are electronic, they are much less expensive to conduct, and data is instantly stored into a database that can be manipulated and analyzed. It is also quicker to create a large sampling, because your contact list can be created by interfacing with your existing customer database, or by purchasing lists of consumers from secondary data companies.  As with mail, the quality of responses tends to be very good, because it is an impersonal process and respondents feel more open to share more "private" information.

Another alternative to the telephone or physical focus group collection methods is Skype, or any other video conferencing type of technology.  Because Skype and services such as Oovoo are available for free or very little cost, it is much less expensive to conduct focus group research when the researcher needs to observe the reactions of the attendees.  These services will usually have the ability to record online "meetings", which allows you to store and refer back to interviews easily.


No matter what contact method you choose to use in your Primary Data collection process, it is important to spend extensive time up front evaluating the type of data you need, and which methods fit your required data types, cost, and schedule.


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Marketing 101: Marketing Intelligence: External Data Sources

When conducting Marketing Intelligence you will need to explore External Data sources.  Here is a list of popular paid and free external data sources.

ACNielsen Corporation
www.nielsen.com/us/
In 100 countries around the world, Nielsen provides clients the most complete understanding of what consumers watch and buy.  Provides television audience data along with supermarket scanner data on sales, market share, retail prices, and household purchases.

Ad Age Datacenter
http://adage.com/datacenter/
AdAge.com's DataCenter features premium content, including profiles of top advertisers, media, agencies and more.

American Demographics
American Demographics creates reports on demographic trends and their significance.

Arbitron
www.arbitron.com
Arbitron provides local radio market and internet radio audience data, along with advertising expenditure information data.

ClickZ Stats/CyberAtlas
www.clickz.com
Provides information about internet use by consumers, such as e-commerce statistics.

comScore Networks
www.comscore.com
comScore provides consumer behavior information and geo-demographic analysis of internet use.  They also have large amounts of data about digital media use around the world.

Dun & Bradstreet
www.dnb.com
D&B maintains a massive database with information on over 50 million individual companies around the globe.

Factiva
global.factiva.com
Factiva offers business and knowledge management solutions, and competitive intelligence data. They specialize in in-depth financial, historical, and operational data on public and private companies.

Federal Trade Commission
www.ftc.gov
The FTC website provides information on regulations and decisions related to consumer protection and antitrust laws in the United States.

Forrester Reasearch (Acquired Jupiter Research)
www.forrester.com/home
Forrester Research monitors internet traffic and provides rankings on the most popular sites.

Hoovers, Inc.
www.hoovers.com
Hoovers provides business descriptions, financial overviews, and news about major companies around the world.

IMS Health
www.imshealth.com
IMS Health specializes in tracking drug sales, monitoring performance of pharmaceutical sales representatives, and offers pharmaceutical market forecasting data.

Interactive Advertising Bureau
www.iab.net
iab creates statistics about advertising on the internet.

J.D. Power and Associates
www.jdpower.com
J.D. Power and Associates provides information via independent consumer surveys of product and service quality, customer satisfaction, and buyer behavior.

LexisNexis
www.lexisnexis.com
LexisNexis features articles from business, consumer, and marketing publications, and tracks firms, industries, trends, and promotion techniques.

NetBase
www.netbase.com
Offers social media analysis tools that help marketing and sales professionals analyze consumer insights, opinion, emotion, and behavior online.

Securities and Exchange Commission Edgar Database
www.sec.gov/edgar.shtml
This SEC database provides financial data on U.S. public corporations.

Simmons Market Research Bureau
www.simmonssurvey.com
Provides detailed analysis of consumer patterns in 400 product categories in selected markets.

SocialBakers
http://analytics.socialbakers.com/
SocialBakers is a premiere provider of social media metrics and analytics tools.

Stat-USA
This popular Department of Commerce site, highlighting statistics on U.S. business and international trade was closed in 2010.  Various websites provide links to all of the data that was hosted there.
http://library.apsu.edu/inform/21STAT-USAtransition.htm (Felix G Woodard Library)

SymphonyIRI (formerly Information Resources, Inc.)
www.symphonyiri.com
Provides supermarket scanner data for tracking grocery product movement and new product purchasing data.

Thomson Dialogwww.dialog.com
Thomson Dialog offers access to more than 900 database containing publications reports newsletters and directories covering dozens of industries.

U.S. Census
www.census.gov
The U.S. Census provides detailed statistics and trends about the U.S. population

U.S. Patent and Trademark Office
www.uspto.gov
This U.S. government agency allows searches to find out who has filed for trademarks and patents across the United States.

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Reality Check: Marketing Defined

Every so often you have to evaluate how you are doing.  If you are a marketing professional, it's your responsibility.  So when is the last time you stepped back, and took a look at what you were doing?  Sometimes the best way to do that is to start with the basic definition of marketing.

The simplest definition of marketing I can think of is: Managing profitable customer relationships.  The goals are to attract new customers through superior value, and to keep growing customers by delivering customer satisfaction.  If you are doing these things, then you will be able to capture value from customers to create profits and customer equity.

So if we break this down, then we get some basic questions that are extremely useful for evaluating your current strategic marketing plans:

1) Are your customer relationships profitable?
If you're not making money, then it's time to start figuring out why.  Start collecting data and begin looking for trends.  It's going to take time to get things back to profitability, so it's best to get started now.

2) Are you attracting new customers?
As much as we hate to admit it, we're always going to lose a customer.  Even the most loyal customers may eventually buy another brand.  If you're not attracting new customers, eventually your sales will fall flat, and you will not be profitable.  So what are you doing to attract new customers?  What value proposition are you presenting to them?  Are you properly differentiated from your competition in your target market?  If your value proposition isn't clear, if you're not clearly different from your competitors, then confusion may be keeping customers from being convinced you are the solution to their want or need.

3) Are you creating satisfied customers?
Are product's perceived performance exceeding expectations?  Meeting expectations? Are customers buying your goods and services again?  Are you gaining new customers?  Or are you dealing with dissatisfied customers and poor sales?  Remember that customer value and satisfaction are the building blocks for developing and managing your customer relationships.

4) Do you have key measurements of your customer equity?  
Customer equity measurements can be better indicators of your performance than sales and market share numbers.  If sales are high, and market share is high, but your customer equity is low, you're going to be losing sales and profits will be tanking soon.  Get some data so you can make some real decisions.

Sit down by yourself, and with your team, and take a day to honestly answer the above questions.  You may be surprised at some of the responses.  Now may be a great time to make adjustments to your strategic marketing plans.

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Marketing Strategies: An Overview

In my relatively short career I've met a lot of people and worked with a lot of organizations.  There are a lot of people who truly know what marketing is, and how to conduct it.  There are also a great number of people who believe that marketing is sending a flyer, an email, or is "just too expensive to do right now".  Many people think they know what marketing and branding are, but in reality, they don't have a clue.

There is a science to it, and more often than not, you need data to determine your strategy.  I'd like to spend the next few months continuing to discuss the basics of marketing.  Today I'd like to start to discuss Marketing Strategy.

Marketing Strategy.  Strategic Marketing.  What is it?  Marketing with a strategy?  Using strategy when you market?  I mean, it seems to define itself.  It seems so logical.  It's a bit more complicated than that.

Marketing strategy is a process that allows an organization to focus it's resources on the best opportunities to grow sales and maintain a competitive advantage.  Let's attempt to break this definition into digestible pieces.

It's a Process.
Marketing, and developing the strategies you are going to use, are part of a process.  It's not quick.  It's not fast.  If it's going to be effective, it takes time and data.  Don't rush.  Strategies are a fundamental part of marketing plans.  You can't even develop your strategy properly until your environmental scan is complete.  

It's centered on an Organization.
Marketing strategies are meant to help the organization meet it's goals.  They don't exist to meet your personal or departmental goals.  A key component of marketing strategy is to keep marketing in-line with a company's mission statement.  

It's all about Focus.
Marketing strategies are focused.  Focus comes from data.  Data helps you construct your multi-year plans.  That's how you achieve your goals.  When you stray from your focus, your strategies fall apart, and you start to bleed dollars from your marketing budget. 

Marketing requires Resources.
Marketing doesn't just involve the VP of Marketing & Communications.  It involves resources from all over your organization.  It's not just dollars (though you really do need the proper amount of them).  It's people.  It's staff.  It's ideas.  It's a team effort.  

It's about the Best Opportunities.
Creating marketing strategies allows you to focus on the best opportunities to grow.  Notice that I didn't say all opportunities, or some opportunities, or the easiest ones.  I said the BEST ones.  Just because you can do something, or spend your budget towards a certain media buy, doesn't mean you should.  It if doesn't directly fit the focus of your marketing strategy and your multi-year plan, then you shouldn't do it.

Marketing is supposed to help Grow Sales.
Marketing is worthless if it doesn't lead to sales.  Some of us don't want to admit that sales drive your business. Sales feed the company bank account.  Sales create cash flow.  Sales allow you to keep your job.  Never ever forget this.  If your marketing strategies aren't growing sales over a defined time frame, then it's time to change.  Remember, marketing strategies are supposed to have the ability to be dynamic and interactive.

Marketing should give you an Advantage.
Effective marketing gives you a competitive advantage.  You should always be differentiating yourself from your competitors.  You should always be selling your competitive advantage.  If you're not, then you're just blending in with the rest of your market segment.

Are your marketing efforts focused?  Are sales growing?  Are you working with your team?  Are you chasing after every opportunity and wasting precious marketing budget dollars?

Maybe it's time to reconsider your strategy.

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Using Online Communities to Create Brand Awareness - Part 2

This is Part 2 of my thoughts on Using Online Communities to Build Brand Awareness.  Last time I discussed how online communities help you build credibility and general awareness about your products and brand.  This time I want to discuss how online communities help you create SEO-aware content, and how they can help you build customer satisfaction.

Many marketing directors don't realize that as you are building awareness through your community posts, you are also creating SEO-aware content.  All posts and comments are index-able.  Search engines such as Google are able to look through and "store" your posts from an online community.  Because these posts are on a website other than your own, Google gives this content more weight, since it considers content about you on other websites more relevant.  As a result, your brand name and product information move up in ranking within relevant search results. 

Google also looks for links back to your website.  Make sure to put the address of your website in your signature.  This insures that your website's address is always displayed with every post, and that it is indexed as many times as possible when a search engine crawls the online community's site.

As you post more searchable content, it becomes easier for existing customers to find information that may help them solve problems.  Online communities are a great way to get involved in the first steps of basic customer service issues.  You can use the posts of others as an opportunity to acknowledge issues with your product.  You can also show your willingness via the public domain to serve the customer and create a positive brand experience.  However, remember that people tend to be more vocal on the internet, because it's a more anonymous experience.  You must always write posts that are calm, clear, and emotion free.  Use positive language, but never "beat around the bush" when a clear acknowledgement of a problem is best.

Remember that today being a part of online communities is necessary when marketing digitally, because it gives you a direct opportunity to build credibility, build awareness, create SEO-aware content, and address customer service issues.

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What Are You Doing To Create Awareness Today?

Did you do anything to market yourself today other than think about it?

Marketing doesn't happen by itself.  You have to do it.

People don't find out about you on their own.  They won't bring up Google and search for you unless they have a reason to do so.

So what are you doing today to create awareness?

If you need a jump start, here are some ideas that might be relevant to your customers:

1. Offer A Discount
Sometimes the easiest way to drive traffic to your website, or to retailer locations, is to offer a discount or a coupon.  However, remember that spending money can be an incredibly emotional thing.  The right price, or discount, can drive a person to spend money "easily" without any thought.  5%-10% off might not be the ticket.  Don't be afraid to explore 20%, even 30-40% off.  If you're concerned about your margins, make it a limited or exclusive offer to a select group of customers.  Once they are in the door, they tend to buy more.

2. Hold A Product Demo Event
People love to research products, and price-shop online.  But at the end of the day, a consumer that touches the product, tries it, and likes it, usually ends up buying it.  Consider putting on a demo event in a location that contains your primary customer demographic.

3. Ask For Product Testimonials Via Social Media
Social media makes it very easy to connect with your customers.  It can be a customer service haven and nightmare.  One of my favorite uses of social media is testimonials.  It's as easy as this:  Ask users of your product to submit positive experiences of your product: video is preferred, text and pictures are great as well.  Incentives are a must.  Offer discounts off of new product, or free accessories to those consumers whose testimonial you choose to post.  Post one a week for 13 weeks - the length of a typical television or radio ad buy.

4. Participate In Online Communities
This fourth option can take the most work, but it can reap some of the largest gains for building your brand's credibility.  It's as simple as joining relevant forums and blogs.  Put your name and company in your signature.  Make it clear who you are.  Offer advice and sensible solutions.  However, you cannot blatantly advertise your product in your posts.  It's best to offer sound advice that may or may not include any of your specific products.  Over time you will see a few benefits:
- Community members will see you as an expert
- Community members will begin to explore your website and your product
- All of your posts will be indexed by search engines (like Google) and it will increase the amount of searchable, relevant content about you online.

It's a good idea to put one of your best PR reps or customer service representatives in charge of online community participation.  Your Social Media Director is a great fit as well.  You can take this a step further by becoming an advertiser in that online community.  This allows you to blatantly post about your product and any specials you may be offering.

These four things are simple, yet highly effective ways to increase Brand Awareness for little cost other than labor and time.  If appropriate, and if used in a focused manner, they are a great way to connect with current and future customers, and can provide a great ROI for a little marketing budget expenditure.

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Targeting Ads Via Smart TV's Will Alienate Consumers

Let me say that I love technology.  I love gadgets.  I wish I had the money to buy more gadgets and try them out.  I love iPads, and iPods, and TV's and game consoles.  I have a special affinity for the good old fashioned television.  I'm a picture snob.  The idea of a "smart tv" with services such as Hulu and Netflix built in are interesting to me.  I've also come to accept the fact that "free" TV comes at a cost: the advertisement. 

I love the "ad".  It's a great way to reach a targeted audience.  It's an effective marketing and branding tool when used appropriately.  But allowing manufacturers to create their own ad networks and present ads via "smart tv's" is just a really fast way to alienate both the buyers of TV's and the viewers of media content.

At CES on January 9th, Samsung announced that it would enable the delivery of ads to a TV user's "home screen", even in 3-D on so-equipped models.  In November 2011, LG made a similar announcement.  This isn't a new model.  TIVO has delivered ads in it's DVR software, and many MSO's such as Cox and Time Warner display ads or poll-type questions via set top box software as well.

As it stands now, the current model is mostly passive.  A user may see an ad on a part of a screen they are on.  It is not part of the content they are about to consume, and it is not a road block that they must endure before viewing content, like the Hulu model for free users.  However, this could easily turn into a model where a television user, through the TV's operating system software, is forced to view an ad before tuning a live channel or opening an "app".  This absolutely cannot happen.  If after spending hundreds, if not thousands of dollars on a television, I must be forced to view an ad to do anything on my set, you will immediately alienate me as a customer, and the ad sponsor may also lose brand credibility with me.  The potential consumer backlash could be considerable.

Television is a passive form of entertainment.  It should never be active.  It should never be difficult for a consumer to get to the content they want to consume.  If there are too many road blocks (ads), then they will give up and not view the content.  This could keep eye balls off of sets, and off of normal broadcast and cable content, reducing ratings and potentially lowering the inherent value of  advertisement delivery via television.

This development does nothing but attempt to give TV's manufacturers a slice of the ad revenue pie, and in the process hurt the advertising industry as a whole.

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Number 1 2012 Marketing Resolution: Communicate Clearly

In 2012 we want to accomplish many goals:

- Sell millions in product
- Grow our brand awareness exponentially
- Achieve the largest marketing ROI for as little cost as possible
- Get promoted to, or hired as a CMO (I wouldn't mind that)

But before you can do anything above, or anything else, here's what you need to do from the first day of 2012: communicate clearly.

It seems simple, doesn't it?

In reality, communicating clearly involves a little bit of work.  Whether you're writing an email, or putting together a message for marketing, follow these steps, and you will be on your way to communicating more clearly:

1) Slow down.  When we rush, we make mistakes.  We say things that we don't intend.  We mix up our words.  Slowing down gives you the time to...

2) Think.  Think about the message you need to convey.  Ask yourself: Who is it for?  How will it be consumed?  What important information needs to be communicated?  After you slow down, think, answer these questions, and compose your message...

3) Review and edit.  You won't believe how often you will catch a typo here or there.  You may have reversed the order of your words.  You might catch a phrase or two that convey the wrong message, or potentially confuse the consumer of your message.

Using this three step method will help you communicate simple or complex messages more clearly and mistake-free.

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Be Purposeful Or Else You Will Be Ignored

On Tuesday, Facebook announced that it would begin adding "Sponsored Story" ads to users' news feeds in January.  This will not happen in mobile apps yet.  This announcement is another step in Facebook's plan to monetize it's business and make it a viable advertising platform. 

If you're an advertiser, this gives you an easier way to get in front of the eyeballs of millions of Facebook users.  If you're Facebook, you just earned yourself some more ad dollars and paid a few more bills.  If you're a Facebook user, you may have another reason to ignore Facebook today.  And that's the caution to throw into the wind:  "Sponsored Stories", if overused, will quickly be ignored, and will have little to no value for any advertiser.  In fact, if Facebook isn't careful, and if you aren't as a media buyer, "Sponsored Stories" could be a huge flop.

Remember that "reach" basically is the number of individuals you want to expose your message to through any type of media scheduled over a given period of time.  For focused groups of audiences, Social Media and other online advertising provide great reach.  However, frequency is where things can go wrong.  When you're visiting a website, such as a news outlet, you expect to see ads.  You're voluntarily allowing yourself to be exposed to them.  Even if advertisements appear, we tolerate them, because we're simply using the website to consume information in an impersonal matter.

Social Media isn't impersonal, it's personal.  Frequency can quickly die off with Social Media, because when ads invade our personal "space" online, we change our usage patterns; quickly visiting a services like Facebook less, or even stopping altogether.  Once that happens, you've lost that consumer, potentially alienating them from your brand (as an advertiser), and possibly losing another revenue generating user. 

That's the slippery slope.  As an advertiser, you need to make sure not to abuse Social Media advertising.  It's users may be more receptive to your messages, but if you over "communicate" to them, too frequently, and without specific value or purpose in your message, they will quickly ignore you.  Once they ignore you, your Brand Awareness measures and credibility may start to decline as well.

Facebook needs to quickly decide how much advertising they really want to force their users to view.  If they continue to add more "ads" to people's feeds, Facebook may quickly lose users, and one of the "pot of golds" of internet advertising may cease to be.

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Saying Apple Won The Mobile Flash War Is Misleading

Remember the headlines in November?  Ones like those in this CNET article saying Apple won the mobile Flash war.  Sources at Adobe were quoted as saying that "We will no longer adapt Flash Player for mobile devices to new browser, OS version or device configurations." (source CNET UK).  So Steve Jobs won.  Flash really is unnecessary on mobile devices.  Actually, it is very necessary.

Adobe made the right move, enabling a successful development platform (Actionscript) to exist in an "app" consumer model within the mobile space via Adobe AIR.  Let's remember what Flash is: a development environment for delivering rich, interactive content to users.  This has traditionally been done via the Flash plugin, allowing web browsers to decode and display this content. However desktop and laptop PC's have more CPU horsepower and screen real estate available for processing Flash content and Actionscript code.  Mobile devices, with their smaller screens, and slower processors, are not ideal vehicles for delivering Flash-based content.

Adobe, FINALLY, recognized this.

So Adobe took a step back, surveyed the situation, and realized what they have: a viable, established development platform.  This development platform not only delivers games and entertainment, but it enables advertisers to create dynamic ads and apps, allowing them to connect with consumers in new ways that traditional advertising does not allow.

That's why the mobile play is so important.  Traditional advertising methods don't work in a mobile environment.  In February of this year, Comscore reported smartphone usage was up 60% year over year (Business Insider).  If you want to get your costumer's attention, it's no longer via a television or a regular PC screen.  In order to win mind share, you have to get consumers in their pockets, so that they will open up their pocketbooks.

Flash/Actionsctipt development via Adobe AIR packaging makes sense. It allows Adobe to continue to sell software.  It allows Adobe to stay relevant with developers. It allows Adobe to be a key player in the mobile advertising realm.  It just makes sense.

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It's about the content, not the algorithm

SEO. Search Engine Optimization.  For the past few years, no other term (other than Social Media) has owned the mindshare of marketers and business owners when it comes to the web.  It's almost a foregone assumption: if I build a website, I must perform SEO.  If I own a website, I must perform SEO.

The next big assumption is that performing SEO means either hiring an expensive "SEO Company", or getting a "SEO For Dummies" book and doing it yourself.  What exactly are you doing when you are "SEO'ing"?  Altering "alt" tags, meta data, headers, tagging images, keyword selection, link-backs...it's almost as mind-boggling as trying to guess how many letters there are in a can of alphabet soup.  Why are we putting ourselves through this insanity?  It's because we desparately want to be at the top of Google's listings.  We want to meet, beat, and even fool Google's algorithm at it's own game. 

It's time to stop the insanity.  Sure, having as much of your content indexable as possible is worthwhile.  Sure, you want to have good keyword selection and contextual page titles.  But lets get one thing clear.  No matter the algorithm, if you don't have relevant content, and others don't think you're content is relevant, Google isn't going to care either.

Google cares the most about relevant content.  If your content is actually about what you claim your website or webpage is addressing, then your content is relevant, or contextual.  If you title your page "Dogs", but you present information about cats, then it is not relevant.  Google and it's genius engineers have figured out how to "crawl" your website, examine your content, and rate it's relevancy.  It grades everything on your page that it can search, or "index.

Not only must your content be relevant, but it must be updated frequently.  Google will index your site on a set schedule once it "finds" you for the first time.  How often you update your content, or create new content, will determine how often Google "decides" to visit your site.  If you create a site, and never update it, then Google will eventually "decide" to visit your site more infrequently, and as a result, it will lower you in relevant search results.  But if you continually update your site, and continue to create relevant content, Google will raise you in it's search results.  Old and stale = forgotten and unimportant.  Fresh and exciting = relevant and important.

Even if you write relevant content, and keep it fresh, unless others also think it is relevant, then Google will not raise you up the search ranking results.  How do others make you relevant?  Link backs.  The more people, in contextual situations, link back to you, then your content is relevant.  What is a contextual situation?  Link farms are NOT contextual situations.  In fact, Google has clamped down on this practice; recently altering its algorithms to remove link farms from the equation.  So many people were "playing" the system with link farms and dummy websites that Google re-worked it's code to severely discount the influence of link farms and dummy websites.

What Google did was increase the relevancy of a website, with content relevant to yours, linking back to you.  For example, a blog post talking about dog sweaters, mentioning your comments about them, and linking back to your site, is relevant.  A series of forum posts on a public community forum site about dog sweaters, with links back to you in those posts, are relevant.  A series of social media posts on Facebook or Twitter, mentioning content about dog sweaters and linking back to your site, are relevant.

Google cares about content that others care about, and if they care about you, then Google cares about you.  So go ahead and optimize those page headers.  Make your site's content match your keywords.  Make as much of your website able to be indexed as possible.  But if your content isn't relevant, and if others don't care about your content, then Google won't either.

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Another Ad Network = More Fragmentation

On Wednesday Yahoo released it's "Living Ad", interactive video ad format for advertisers.  This new ad format works within an ad network, that is centered around Yahoo's Livestand publication app.  Livestand, along with it's ad network, enters an already saturated ad "market" occupied by the likes of Flipboard, Zite, AOL's Editions, and Pulse.  Yahoo is pushing advertisting packages to buyers, some of which are said to run upwards of $500,000.

According to Yahoo, Livestand features a magazine-style layout.  It will launch with some content from third-party publications.  Those publishers will share their ad revenue with Yahoo.  The details of these revenue sharing arrangements are not yet known. These publishers can also re-sell ad packages on the plarform.  I can only deduce that Yahoo get's a cut of that revenue as well. Diane McGarvey at Scientific American, which is offering some content on the Livestand, states Yahoo will keep about 70 percent of revenue on ads sold to appear inline with Scientific American content.
Living Ad, along with Livestand, is one of many initiatives to attempting to make Yahoo a relevant player in mobile advertising.  Mobile advertising is projected to net around $1 billion this year in the U.S. and up to $1.2 billion in 2012, according to eMarketer. Yahoo is positioning itself to receive as large a portion of this pie of revenue as possible.

The mobile ad space is already over-saturated.  Frankly, none of the ad formats and networks bring anything new to the table.  Nothing currently compells a consumer to do anything after viewing these ads compared with any other form of advertising medium.  We don't need another ad network.  We don't need another "method" to get an ad to a consumer.  What we need is a new type of ad, a new way to interact with a product, that might actually compel a consumer to buy.

Advertisers, and content networks, need to bring new ideas to the table.  The internet and mobile phone networks bring whole new possibilities to advertising via interactive ads.  An interactive ad would allow a consumer to configure products, explore them, walk around them, try a focused "demo" of it.  After they have played with it, or configured it to their hearts content, they could be connected with a vendor to purchase that product within a few clicks.  This gives the consumer a quick way to satisfy their emotional desire to buy the product.

However, most online ads don't do anything other than present a picture, an animation, a call to action phrase, and link to a normal website.  There's no point to showing a traditional ad online or on a smart phone if there's nothing new about it's experience.  None.

Yahoo's Living Ad is trying to do this.  However, most advertisers don't seem to know how to create an ad "experience" that really compels consumer interest.  We need to stop telling

If advertisting is going to survive, and make money, the "ad" as we know it needs to evolve along with the technology available to deliver it.  With the growing popularity of mobile devices that are connected to mobile data networks, there is a new opportunity to truly try something new.  Who is going to lead the way?

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Where's The Beef?

I was born in 1980.  I remember lots of things from my childhood.  I remember GI Joe, the Transformers, Mask, the Challenger disaster, Christmas at my grandmother's, and a basic, loud phrase coming from an elderly woman on television: "Where's the beef?"

In 1984, a spot entitled "Fluffy Bun" appeared featuring actress Clara Peller, asking the question, "Where's the beef" upon receiving a massive hamburger bun containing a paltry piece of "beef."  Wendy's used this iconic phrase to poke fun and embarrass competitors such as McDonald's and Burger King, bringing to light the tiny, sliver patties being put into fast food burgers at the time.

Fast forward over twenty years.  The phrase has become part of our American culture, but the origins, and the meaning, have slowly faded away.  Over time, with Wendy's leading the charge, the major fast food restaurants have been offering more items with more natural ingredients.   Now they are upping the ante again, releasing a new line of value hamburgers that aims to one-up category leaders based on quantity and quality of the beef in the sandwich.  In order to do this, Wendy's resurrected "Where's the beef?"  It's a spot-on approach.

In order to bridge the gap between a generation of consumers from the 1980's and the 21st century, Wendy's used today's current retro fashion trends, placing "Modern Family" actor Reid Ewing in a 1980's styled "Where's the beef sandwich" walking down the sidewalks of urban settings.  Along the way, people familiar with "Where's the beef?" give him the proverbial "thumbs up".  The main character doesn't understand the recognition he receives, until he comes up to a sign at a local Wendy's.  Then it all makes sense.  Cut to juicy shot of large hamburger, product sold.

Frankly I think this is brilliant.  We could have seen Clara again.  We could have seen the big bun, small patty.  Instead, what we see is a brilliantly simple connection between two generations.  There's no hard sell, not silly gimmick, just a recognition of pop culture history, and a delicious looking hamburger.

The most powerful messages are sometimes the simplest ones.

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Is the 30 second spot relevant?

No one watches commercials anymore, right?  In the age of the DVR, we zip right past them.  Commercials are old school, they are relics of ages past.  It's all about the web, social media and gorilla marketing via YouTube, right?

Is there any point to a 30 second commercial on broadcast television?  Absolutely!  Not only are they relevant, but they are the best way to build brand equity through brand awareness.

In order to build Brand Awareness, you need to get the attention of your audience.  No other human sense gets our attention better than visual stimuli.  The phrase "a picture is worth a thousand words" is still very true.  Commercial advertising used to be all about the "sell".  Get a spokesperson, list off your product's features, and tell everyone to buy it.  There was no better way to sell a car or a frozen dinner in the 1960's and 70's than to list off your features and tell a viewer to go and buy it.  It doesn't work the same today.

Today you have to get someone's attention.  You have to pique their interest.  You have to create buzz.  You have to make the emotional sell.  Saying your car is "Imported from Detroit", or "You're In Good Hands With Allstate" speaks louder than telling everyone your insurance has lower monthly premiums.  Connecting with an older audience, while featuring someone from a new generation in a simple t-shirt does wonders when you want to get everyone to ask, "Where's the Beef?".  One commercial, one visual, can spark a flood of conversation that spreads from the office water cooler to the status updates of Facebook. 

Today television presents a great ROI, not just because you can reach millions of eyes at one time, but also because you can use it to drive people to more direct brand interaction and messaging.  The venerable commercial used to be a one-way experience.  The viewer watched it, and you hoped that the message would soak in.  You hoped they would go to a store and interact with your product.  Today a viewer can have instant interaction with your brand via the internet and mobile devices.

Today a commercial that doesn't just create interest, but moves someone to interact with you is essential to a successful campaign.  Want to find out more?  Go to our website.  Want to get great deals?  Visit Facebook or GROUPON to get 20% off your first purchase.  Visit YouTube for more clues and win your very own car.  You couldn't do this 20 or even 10 years ago.  Now you can.

No other medium allows you to reach as large an audience at once as television.  However, Jerry Shereshewsky, a New York City ad agency veteran and CEO of Grandparents.com, asserts that if you want to get narrower than a general demographic, you're out of luck.  With today's audience diversification and deep pool of niche channels, this isn't the case. TV is now a target rich environment, and it allows you the opportunity to tailor your message for any specific demographic.  Even better, that demographic is a willing listener.  You don't want to watch Food Network or G4 because you have to, you watch it because you want to, because you're interested in that hobby or vocation.  Viewers of these niche channels are already willing to buy items to suit their interests, and if your product fits these interests, they are willing to listen to you.

Getting attention, creating interest, and encouraging brand interaction are all possible today through the focused use of the 30 second spot. What used to be a multi-million dollar shot in the dark is now a viable, successful option for building brand equity through brand awareness and brand engagement.  Consumers are willing to watch commercials...are you giving them a reason to watch yours?

Wendy's Brings Back "Where's the Beef" - Chicago Tribune
Which Ad Strategy Works For You? - Entrepreneur Online

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Is Anyone Aware?

One of the items I mentioned last week was Brand Awareness.  What is Brand Awareness?  It is the measure of a consumer's knowledge of your very existence.  The "aggregate" level is the proportion of consumers that "know" your brand.  Why is this "level" even important?  It's important, because the creation of brand awareness is the PRIMARY goal of advertising, and it influences the behavior of the buyers of your product.  However, remember that all of your measurements of brand awareness are, at best, approximations.  They are not exact. The more measures used, the more complete your understanding of brand awareness will be.

Brand awareness is measured "simply" by showing a consumer the "brand and asking whether or not they knew of it beforehand.  Many textbooks have conceptualized brand awareness simply as the knowledge that the brand is a member of a particular product category, such as fast-food.  However, common practice says there is more than one recognition and recall measure, all of which test the brand name's association to a product category cue.

However, "knowledge" doesn't give us much data to do anything with.  So, we use three common metrics that can be measured:

• Brand Recall - Either the brand name or both the brand name and category name are presented to survey participants.
• Brand Recognition - The product category name is given to participants, and are then asked to recall as many brands as possible that are members of the category.
• Top of Mind Awareness - Brand Recognition, but more specifically only the first brand recalled is recorded (called "spontaneous brand recall" by some).

These measurements can be used for creating an understanding of Brand Equity.  Brand Equity is the positive effect of the brand on the difference between the prices that the consumer is willing to pay compared to the perceived value of the benefit received by your product.  The more value, the more a consumer will pay for your product.  Brand Equity is built by brand awareness activities such as advertising, PR, and promotion.  Simply put, the more Brand Equity, the more you might be able to charge for your product.  Higher prices can lead to higher profits.  You're in the business to make money right?

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