The true marketing revolution: the peak of the pyramid (we’ll get there)

Part III 

Now, just like all good communities throughout the history of time, the marketing community has evolved. In the late 60s – and we continue to see this focus from marketers worldwide today – we spent a lot of time looking at our products and services as brands. (Granted the activity of branding goes much further back than the 1960s, but branding as we define it today originated with the exponential rise in popularity of information distribution: print, radio and television.)

A brand is a set of expectations, memories, stories and relationships that trigger a consumer’s decision to choose one product or service over another.

Seth Godin, December 2009

 

There are a couple of things to consider when we combine both Seth’s definition of a brand and Abraham Maslow’s Hierarchy of Needs:

First, in positioning our products and services as brands, we have moved businesses to the third and fourth rungs in the Hierarchy: Love/Belonging and Esteem.

As a consumer, knowing (albeit subconsciously) that a brand stands for something – an expectation, a memory, a story – you start to consider whether or not you actually want to be a part of that experience and acquire whatever status or reputation it bestows upon you. Should we choose to take part in this experience – to feel it for ourselves – we now become part of a community; we share the stories and the memories. We essentially add to the value of the brand; or take away from it depending on the outcome of our interaction(s).

As a brand, Seth’s definition clearly demonstrates that YOU are looking to create stories and build relationships!

For both the consumer and the brand itself, branding hinges on motivational cues in the love/belonging and esteem realms suggested by Maslow.

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Secondly, the brand triggers a consumer’s decision to choose its product or services over another. To a certain extent the precious value of choice touches on all three of the higher rung motivators in Maslow’s Hierarchy, even self-actualization. I suggest this, not with a unicorns are real sentiment, but rather because – especially in certain industries and product lines – the choices I make as a consumer are made because I believe they help me achieve my goals, dreams and ambitions.

Branding empowers consumers to choose.

 

And therein lies a lot of fear, doesn’t it?

We have created a differentiator so powerful, it bestows the power of choice onto our audiences rather than ensuring our own control over the volume of product or service we sell or the revenue that we make. For businesses this realization may have translated to a slow nudge in the opposite direction of the Hierarchy of Needs. Businesses may be slipping back onto the Security rung where they continue to struggle with acquiring and keeping resources of all kinds, while trying to grow revenue and acquire a larger market share for fear of not being able to survive the economy and the changes in the world today.

Considering that consumers and businesses appear to be going in separate directions, we may be experiencing some difficulties, wouldn’t you agree? Not usually the best way to build and sustain relationships!

Vala Afshar (@valaafshar), Chief Customer Officer of Enterasys Secure Networks (A Siemens Enterprise Communications Company), and a very wise friend (I met via twitter), frequently reminds us that:

 

Give some thought to your audience and your business. Where do you find yourselves on the hierarchy of needs? Are you in the same place? Moving in the same direction? Are you a match made in heaven? How is your brand working as a powerful differentiator that will align your reasons with those of your audience?

The true marketing revolution will elevate the role of the business from making money to satisfying consumer needs and desires to making genuine contributions in their communities (local, national and global).

In Part IV, I’ll suggest a slightly different primary shape for the Hierarchy of Needs and from there, the discussion (I hope) will go on!

The true marketing revolution: the peak of the pyramid (still sorta)

Part II

As we continue the journey to the peak of the pyramid, I think it’s also important to look at where we came from. What are some of the things that we – businesses and brands – have been doing? Things that work, things that don’t work. It’s especially important as we seek the real nugget, getting to what businesses are so desperately seeking these days: genuine advocacy.

To quickly define our elusive brand advocates: they are those people who actively influence (or, at least, attempt to) others who are looking – and sometimes, not looking – for whatever it is your brand offers. We can discuss the value of a brand advocate in terms of profit in a later post but for now, allow me to direct you to this post by Edelman Digital.

Now, back to our climb of Maslow’s Hierarchy of Needs.

Assuming that Maslow was right, and that in 1943 the only way to apply his theory was to look at it as a hierarchy where one motivational need must be completely satisfied before focusing on the next, then the explanation for discounting is clear.

 

Focus on the Safety need:

We will all recognize the notion of discounting, couponing, BOGO (buy-one-get-one). These types of promotions work wonders drawing in a crowd. We are living through an economic crisis and there is proof after proof that couponing is alive and well! In fact, according to NCH Marketing, in 2011, American consumers received over $4.6 billion in savings in 2011 – and that trend was up by $500 million over the year before. This works; this drives business; and gosh darn it, people like this!

But, there’s an issue with this method of reaching and drawing in an audience. First, competing on price in any industry will only drive revenues down to everyone’s detriment independent of the fact that costs are going up. Not good. Secondly, from a consumer standpoint, when businesses compete on price – the wallet wins but a few things happen:

1. I always look for the cheapest price first. So, I have no loyalty to you unless you continue to be the lowest priced widget seller in my region.
2. I am unlikely to get good service because in order for businesses to cut costs as they drive prices downward, compensation is likely affected in turn affecting employee motivation and service levels.
3. I am likely to be selecting a product that very well could negatively impact my local economy (in turn affecting my community) as businesses seek out cost cutting methods to support their low price efforts.

Based on Maslow’s Hierarchy of Needs, promotions are focusing on the 2^nd lowest rung – Security. There is no doubt that in our economic climate, this is an important factor to pay attention to, but let’s be clear: Security does not drive loyalty or advocacy.

Are you looking long term? Are you considering the consumer of tomorrow? And, more importantly, what are you doing as a business to ensure that you are building genuine advocacy built on sustainability, value sharing, and relevancy?

Your consumers are people. Your employees are people. Chances are these people need more than to be stuck on the bottom rung of some psychological metaphor for a pyramid, wouldn’t you agree?

The true marketing revolution will elevate the role of the business from making money to satisfying consumer needs and desires to making genuine contributions in their communities (local, national and global).

Part III considers the way marketing continues to evolve and personifies brands.

The true marketing revolution: the peak of the pyramid (sorta)

Part I

In the latest post exploring what could be the true marketing revolution, we looked at creating experiences that generate positive emotional triggers for your audience. Ideally, you can infuse each interaction, each touchpoint, with these positive triggers. We know now that positive emotional triggers will generate repeat behaviour. That’s so critically important for a business because it means repeat business and, in a perfect world, it means advocacy.

Now, like all good studies, understanding one thing means asking more questions about another… and the question, in this case, is “how” do I tap into these positive emotions and succeed at creating genuine advocacy for my business?

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I shared some thoughts on this question at #140MTL yesterday; and it has a little something to do with this:

 

Maslow’s Hierarchy of Needs, 1943

 

But, I don’t want to go there just yet –to start, as I did during the presentation, I’d like to set the stage.

Flash Marketing History 101:

In one of the Lemontwist’s previous posts, we looked at some history around marketing thought (over marketing practice). Let’s just take a quick look at the proposed marketing eras:

• Production (late 1800s)
• Product (early to mid 1900s)
• Sales (mid to late 1960s)
• Market (late 1960s to late 1980s)
• Customer (late 1980s to 2000)
• And, now, the relationship era (21^st century)

What marked each of these eras is a focus on technological and scientific advancements. From the printing press to improved roadways to sociology – businesses have been adapting how they work based on society’s innovations and progress. Having a great grasp on what they do, businesses spent centuries refining how they do things, and how they communicate, how they increase revenue, how they become the largest brand, how they buy other companies, how, how, how…

Unfortunately, that left very little space for the humanity in business. It seems we’d forgotten that people – human beings – founded business; they run the business and they work for the business. You and I!

So, why have we spent centuries focusing solely on WHAT and HOW – on product and process – without somehow also thinking about WHY we’re in business (and for who)? No; money is not the reason you are in business. It is not the answer to WHY. Money is a necessity and an outcome, not an answer.

The answer to WHY has to do with humanity: you wanted to improve something, change something, save your parents from cancer. You didn’t choose your profession because of money; you did because you actually cared about something, or liked something, or wanted to explore something. Think back to your childhood days – you wanted to change the world, fix something, save someone. It wasn’t about money. WHY was it?

So, how do you consider the humanity in your business – in the interactions between the people who own the business, who run the business, who buy from the business… who are the business?

The true marketing revolution will elevate the role of the business from making money to satisfying consumer needs and desires to making genuine contributions in their communities (local, national and global).

 Part II looks at what businesses are doing today… y’all come back now!

In 2012, know what you stand for

As the year draws to a close, it is time to reflect on 2011 and determine the course of action for 2012. Or so, this is what is believed. In fact, even brands, companies, businesses (whatever label you’d like to give them) spend some time at this time of year determining what they’ll do for the next. Even if your fiscal year end doesn’t actually close on December 31^st, this is the time to consider what happens next.

Now I won’t downplay the tradition of a good New Year’s resolution, but I will suggest that it is not (or at least, should not) be the paradigm shifting, earth shattering, groundbreaking “thing” that some people believe it is. Going back to the first post of 2011, you’ll recall the introduction to Simon Sinek’s book: Start with Why.

The whole premise behind the concept of “Start with Why” revolves around understanding the deep root of everything you do. Not WHAT you do, but WHY you do it. Why do you wake up in the morning? What do you believe in? What makes you tick? What do you stand for? The difficulty in understanding these answers is two-fold:

1. These questions conjure up emotions, which most of us know, are incredibly difficult to genuinely express in words; and,
2. The honest answers to these questions inevitably turn some people away from you, which is hard to accept as a human being.

However, the reality is that taking the time to find the real answers behind those questions actually makes us happier and more productive.

As a collective: a brand, a business, a product team – taking the time to answer these same question with respect to whatever entity you are in charge of also makes for a happier, more productive (and very likely more lucrative) outcome. It ensures that each member of the team is rowing in the same direction and it ensures that focus is placed squarely on those consumers who matter.

Consumers who matter? What? All consumers matter, right? I respectfully disagree. The consumers that matter are the ones who believe in what you believe in and who respect (and support) what you stand for. Why does this make them matter more than other consumers? Those consumers are the ones who are more likely to understand some business decisions. They are the ones who aren’t looking for discounts, but are looking for value and integrity. They are the ones who are more likely to forgive you in difficult times. And, they are the ones who will promote you to all their friends… and throughout all their social networks. Now that’s real reach and a real opportunity for influence.

So, back to the concept of the New Year’s resolution… As a marketer, let me suggest two options:

1. If you haven’t yet sorted out your WHY, start there. Make 2012 the year where you can articulate what you stand for, and start building the roadmap to showcase how you do it.
2. If you know what your WHY is, then focus your efforts in 2012 on really connecting with those consumers who matter most. After all, without the most valuable consumers, you are not in business (for long).

What will I do for 2012? Well, I’ll continue to develop this blog and the ideas that emerge from it. I consistently believe that businesses can genuinely make a difference in this world we live in – from greening our planet to helping the homeless to promoting education to creating jobs to supporting innovation and advancement across the world.

In the end, I still believe we are on the cusp of a marketing revolution. And that the true marketing revolution will elevate the role of the business from making money to satisfying consumer needs and desires to making genuine contributions in their communities (local, national and global).

On that note, I wish each and everyone of you the best for 2012. Thank you for reading the Lemontwist, and I look forward to more discussions in the year ahead.

The true marketing revolution: the emotion connection

As I continue to delve deeper into the real need that (I believe) businesses must have in understanding human emotion – and how that emotion will link to longevity for the business, I was introduced to Plutchik[1]. In his study of emotion, Plutchik hypothesized that emotions and emotional reactions are evolved – not only during the course of an individual’s life, but through the course of humanity and its history. Now, you may be wondering why the history and evolution of emotions is of any importance to business; this, after all, is all about psychology only, right? Wrong!

As I’ve mentioned in a previous post, it is my genuine belief that consumers interact with your brand based on an emotional catalyst. From the conversations I’ve had after writing that post, it would appear that some people agree. As I studied (and continue to study) some of Plutchik’s work, some truly interesting facts stand out. Of particular interest for marketers and brands:

1. Emotions are broken into 2 parts:

• Being exposed to a stimulus, and
• Evaluating that stimulus.

A couple of things are important to note here.

• First, the stimulus can be anything from a person to a thing to an event. For a brand, this means every person; every touchpoint; every product; and every phone call is a stimulus!
• Secondly, the evaluation, which is how the emotion is selected, comes from the individual’s lifestyle, genetics, history, work and life environment. For a brand, this means that a person’s context in life is critical to understanding how and why people react the way they do to your brand and to your messages.

2. Emotions trigger behaviours. In fact, the effect of an emotion is to create an interaction (positive or negative) with the trigger of the emotion.

This explains a few things for brands.

• Everything you do – from advertising to posting on a Facebook page to selling your wares – will trigger an emotion. (We haven’t discussed intensity yet, but suffice it to say your audience is feeling something.)
• When your audience feels something, they will do something. Every emotion triggers a behaviour. (We also need to remember that not every behaviour will be overt.)
• The content of the interaction becomes the stimulus for the emotional trigger. As marketers, we need to ensure that the content triggers a positive emotion to link to a positive behaviour. We know all too well the results of negative emotions, now don’t we?

3. An emotion triggers a behaviour; and the result of that behaviour inevitably engenders another emotion. So the cycle is started…

This reality is of particular importance for brands and marketers. Consider an event – an interaction between your brand and your audience.

• A negative reaction (aka negative emotion) will result in your audience sharing the experience. When people talk about their negative emotions, the dialogue often turns visceral and the negativity increases in intensity – not to mention increases in reach in our hyper-connected world. Needless to say, your brand comes out as the villain in a story that can only have one hero – your competitor!
• On the flipside, a positive emotional outcome also has reach and the opportunity for a shared experience. When people share positivity, especially as the emotion intensifies, the benefits – from both a biological and psychological standpoint – increase for that individual. When that happens, people tend to have the desire to repeat the behaviour that started it all.

Brands should pay attention to this last point. The idea that consumers will repeat behaviour sings a beautiful song to brand owners, marketers, and business people. It supports the notion that somehow, somewhere loyalty to a brand exists. And it does, but it doesn’t just happen because someone smiled. Take another look at that paragraph – the key is in the intensity of the positive emotion. The deeper the emotional bond, the more intense the positive reaction and the richer the experience, the more likely the consumer will repeat the behaviour.

Generating that type of intensity requires much more than product knowledge or customer service training. Getting to that point with your consumer demands a genuine demonstration of caring. You must go beyond the desire to sell your product or service simply for the benefit of your bottom line. You need to show an authentic desire to help your consumer, to improve their lives in some way.

So, what are you doing to value your consumer’s context, develop engaging content and demonstrate genuine caring?

It’s time for us as marketers, brand managers, business owners and leaders to realize that…

The true marketing revolution will elevate the role of the business from making money to satisfying consumer needs and desires to making genuine contributions in their communities (local, national and global).

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[1] Robert Plutchik (21 October 1927 – 29 April 2006) was professor emeritus at the Albert Einstein College of Medicine and adjunct professor at the University of South Florida. He received his Ph.D. from Columbia University and he was also a psychologist.

Consumer Republic – A book review

This post is long overdue – so I apologize. Not only to the folks who read this blog, but also to Bruce Philp who wrote an amazing book that I devoured at record speed and should have shared with others earlier this summer. So, without further ado, here we go:

 

Somewhere in a small town along the shores of the Georgian Bay, Bruce Philp really loves his toaster… Why should you care?

Well, according to Bruce – in his recent book, Consumer Republic: using brands to get what you want, make corporations behave and maybe even save the world – you should care about whether he, or any other consumer out there, really REALLY loves any of the products, services and brands they come in contact with. Why? Because THAT is how you will get real references and evaluations of said products, but also because THAT is how you can then find the communities you want to associate with. (Why? Because that’s where your consumer is!)

Consumer Republic is a book that was clearly written for the consumer. It helps us understand that we are truly experiencing the democratization of consumerism*. Consumers, and we are all consumers, learn an important lesson in Philp’s book: we have the power to make corporations behave. Now, in theory, we always have. In fact, the reason businesses are IN business is because consumers (yes, you & I) spend money on their wares – whatever they may be. If we didn’t spend money with those brands – or rather, if enough of us didn’t spend money with them – they would go out of business and we’d never hear from them again. So what we understand in Consumer Republic is that if enough of us stop spending money with a certain brand we can, in essence, put them out of business.

Bolstering the power consumers already have is this onslaught many have called: Web 2.0 or is it 3.0 now – social media. Philp explains that social media gives consumers the power to bond (Maslow’s 3^rd pyramid rung) around their feelings for a brand. Did they love it or hate it?

Bruce prescribes how consumers can use the power of the web: access to information, communities and quick rallies to demand accountability from brands. As business owners and brand managers, this book is a must-read. If you know how your consumers can mobilize communities to help or hinder, you can design products, processes and community content that is valuable, relevant and can tap into the positivity of groups.

If you haven’t yet picked up this book… GO!

 

*Democratization of consumerism:

By definition, this simply means the move towards more democracy for society’s preoccupation with the acquisition of consumer goods and services.

In my opinion, what we are experiencing is consumers’ realization that they have the ability and power to shape businesses’ behaviours. The tables have turned. So, how will businesses stay afloat?

 

My suggestion? Consider the last few posts.

The true marketing revolution will elevate the role of the business from simply making money to satisfying consumer needs and desires to making genuine contributions in their communities (local, national and global).

The true marketing revolution: not a simple mathematical formula

Throughout my research, what has stuck out for me is the systematic error that marketing practice* models have made. The constant default position that demands logical explanations for consumer behaviour then uses statistical models to interpret those behaviours and finally relies on mathematical methods to calibrate economic levers with the ambition to shape or influence that behaviour.

The evolution of marketing thought* (as well as psychology, sociology and behavioural economics) repeats – time and time again – that people make choices based on desires, values, beliefs, and yes sometimes even their genetic make-up! Understanding this is a first step; and that first step is one that most people and companies have willingly taken. The problem is with the next step…

A business’s goal is to achieve the bottom line: some form of monetary result that has been established as satisfactory and desirable. Usually, that bottom line is achieved in a sum of multiple single transactions to achieve revenue targets – ideally, without further customer service costs (which are considered overhead and impact the balance sheets).

Though businesses have agreed that emotion plays a role – and have added metrics to measure the impact of emotion to the end result – the measures of success remain generally numerical with little true regard for the value of interactions, the depth of interactions and the true value of brand ambassadorship.

In order to get to the heart of the matter, it’s critical to understand how to genuinely tap into the emotional side of a consumer interaction — which can play a dual role of hook & close.

“Emotion is the complex psychophysiological experience of an individual’s state of mind as interacting with biochemical (internal) and environmental (external) influences. In humans, emotion fundamentally involves “physiological arousal, expressive behaviors, and conscious experience.” Emotion is associated with mood, temperament, personality and disposition, and motivation. Motivations direct and energize behavior, while emotions provide the affective component to motivation, positive or negative”

(according to Wikipedia.com)

Other definitions also highlight emotions as the resulting feelings from natural human tendencies of balancing approach and avoidance. For example: you want to go to a party (approach) but it’s Monday night and on Tuesday morning at 8am, you are asked to attend an executive policy review meeting (avoidance).

For a marketer, this understanding is critical. It basically tells us: individuals are making decisions (i.e. to buy or not to buy) based on their emotions (approach & avoidance conflicts). I would even go out on a limb and say – they are making decisions based on their emotions only.

Allow me to explain:

If I need a car, and even if I say – I just need a car to get me from point A to point B (a rhetoric I hear frequently), emotion is still the catalyst of the need. A variety of situations may have caused the actual need (not want) for the car (i.e. I moved outside of the transit area; I have children or animals; my work demands it; etc.…). Each of these situations in turn creates the need and come with their own set of emotions, which cannot be denied. It is as those emotions arise that the consumer “needs” come to the surface and must then be acted upon.

So, even without actually looking at what has traditionally been identified as emotional triggers – i.e. colour, brand name, status, etc.… – we have already tapped into an emotional catalyst for this need.

I propose that the key for success in any business that needs consumers (and which business doesn’t?) is therefore to ensure that the resulting emotion from making a decision is a positive one. Since Pavlov (1901: reflex conditioning) and Skinner (1904: operant conditioning), we’ve known that an action, which delivers positive emotion, is likely to result in repetition of the action. You see, it’s always been about emotion; and we’ve known this for over a century!

As more people understand this, there is a higher demand for actions that result in positive emotion (as opposed to frequently used fear tactics). This requires businesses to adjust their perspective in order to provide the customer with multiple “positive emotion points” in order to continue to reinforce the value of the relationship between the brand and the consumer. In turn, this will lead to repeat transactions, brand ambassadorship and – ultimately – consumer loyalty.

Measuring success will require more than mathematical models – traditionally referred to in business as ROI models (return on investment). A wise twitter friend – Ted Rubin – refers to a new set of metrics: ROR (return on relationship). What Ted proposes are a set of measures that look at – not only the number of people who follow or “like” you in social media, but also who interact and share your content… people who are engaged. Ted’s focus is on social media, but the theory of expanding measures from pure number of interactions to the reach and influence that specific interaction had can be applied beyond the Internet.

I believe that companies will succeed as they realize that they are not operating within communities; they are a part of those communities… citizens within.

So, again, I re-iterate the drive for this blog series:

The true marketing revolution will elevate the role of the business from making money to satisfying consumer needs and desires to making genuine contributions in their communities (local, national and global).

* See this post for the difference between marketing practice & marketing thought

**Photo source: http://bit.ly/m18vJs

The true marketing revolution: Business born out of a heartbeat

Maybe I’m late to the game, but as I continue my exploration of the history of marketing – I discover many things that enlighten me. For example: in actual fact there are two different methods to studying the history of this field:

• “The history of marketing thought, giving theoretical accounts, and
• Marketing history, focused on the history of marketing practice”

When I think back to my marketing education, the focus was squarely on the 2^nd of those bullet points: marketing practice. Recall the lessons on the infamous 4 Ps of marketing? Of course when you study marketing to become a marketer, learning the practice is – not only important – but a basic need for entry. I would argue though, that as we become a more educated and a more connected society, this practice evolved over a period of 100+ years needs do a deep dive to truly understand how it got here, and then look at revolutionizing what we do today. As I mentioned in my earlier post, understanding where you came from is critical to setting a path for where you want to go.

I simply wanted to use this preface to explain my choice of focus for these posts on the history of marketing thought. I confess: these are my “open thoughts” as I work through what – I believe – will be a paradigm shift for the marketing practice. Your company on the journey is welcome and appreciated.

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The term marketing has been used for centuries – mostly for defining the simplest of transactions: buying and selling. In its original form, marketing’s purpose was simple: to move a product (services were not considered separate at the time) from the seller to the buyer. Some of the 4Ps were experienced, but not as we know them. And, the most critical 5^th P – people – wasn’t even a thought!

Though there are arguments against some of the thoughts and theories put forward by Robert Bartels (1913-1989), he is still considered one of the pioneers of marketing thought. Bartels explains that early students of marketing were in actuality – economists – but that they brought forward divergent theories, which set them apart from traditional economic science.

Economy vs. Marketing

In the early 1900s, economic science was still putting forward that demand was driven by purchasing power. (Put simply: the more you can buy, usually based on the amount of money you have, the higher your purchasing power.) Marketing thought however, challenged the notion that only purchasing power drove demand and suggested that human desire combined with the ability to purchase had a much deeper impact on demand than the simpler suggestion offered by economists.

The notion that humanity had anything to do with moving products from seller to buyer was a revelation in and of itself! For business owners the question was: how can I move more product and make more money? For early marketers, the question was: how can we use the economic methods we already know to take advantage of this revelation and move more product – to make more money?

Enter: Behavioural economics

The early days of behavioural economics saw a drastic shift in belief of how people made choices for what they buy. Early behavioural economists were just skirting the issue of rationality vs. irrationality suggesting that given a number of (predictable) parameters, people would make the most rational choice. There were lots of limitations in this proposed theory.

Herbert Simon (1916-2001) put forward the notion of bounded rationality. The theory of bounded rationality suggests that people always intend to be rational, but due to lack of information or lack of time, they cannot and make the best decision with the parameters they are given. “One may think of any decision as arising from two sources. One is the external environment—how we respond to the incentives facing us. The other is the internal environment—those parts of our internal make-ups that cause us to deviate from the demands of the external environment.” (Simon 1996b) Consideration for someone’s emotional and genetic make-up as an influencer of consumption behaviour was finally in the books – it was 1996! Now, Simon had been discussing these shifts in decision-making as early as 1935, but they didn’t really take-off until much later.

Even today however, I still find myself hearing commentary and participating in discussions highlighting the “old way of doing things” where bottom-line is the only thing driving business, but somehow not the only thing driving the people running those businesses.

Colour commentary

If businesses are run by people and produce goods & services for people, then why are they still guided by rules and regulations born out of science and mathematics? Look, I’m not trying to be naïve: I’m well aware that no one goes into business to lose money. But, let’s go back to the first post of the new-year. In particular, I want to draw attention to Simon Sinek’s concept of “Start with Why”.

We can all agree that no one goes into business to lose money, but can we also all agree that no one actually goes into business to make money? People go into business because of passion – passion they have for their art, their industry, their values and their beliefs. Agreed?

OK, so if people are in business because of passion – then they are not driven by the laws of science and math. They are not driven by their brain; they are driven by their heart. And, if that’s true of people who run businesses – wouldn’t we also believe that the people who influence business success – i.e. employees & customers – are also driven by their hearts & passions? (OK, granted that’s a rational explanation and I’m arguing this point here…)

Are we all on the same page? Back to the argument that marketing needs a revolution…

If people are driven by emotions then why do we still rely on logical and rational arguments to make marketing decisions? How can we consider criteria/parameters that empower us to take account for our own irrationalities and those of our consumers in order to make the best decisions possible? How can we ensure that our products, services and messages speak to the passions of our consumers? And, how can we allow our emotional self into business to make more natural/human choices & decisions?

CAVEAT

Folks – there is much more to the history of marketing thought than I can cover in any one post.  Your input and dialogue can only build the case more strongly. And, as I continue to uncover nuggets of enlightenment, I promise to share them. These posts will only scratch the surface, and hopefully start a conversation about how we can move to the next level – one much more in tune with what the world needs today.

I re-iterate my thoughts:

The true marketing revolution will elevate the role of the business from making money to satisfying consumer needs and desires to making genuine contributions in their communities (local, national and global).

Photo source: http://www.geniusdv.com/news_and_tutorials/2008/09/after_effects_heartbeat_part_3.php

Guest post: It’s too late to apologize (author: Laura Williams)

 

Hello there. Judi has kindly invited me to do a guest post on her blog. I have my own blog at Lectrify.ca, but my primary focus is on anything that electrifies our lives. For me, that means entertainment, and so I frequently post on movies, music, books and art. That said, today’s post is about the shift we are seeing in relationships between corporations and customers. This has been prompted by the natural changes in society, and is being lived out on the social media stage. I encourage Judi to pipe in with her own comments, given she has direct experience with this topic. So, Judi, allow me to set this up and then, take it away.

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Sorry – so sorry

When I started my career, the alpha dog in our company frequently said “Never apologize.” It seemed like good advice at the time. I took it to mean confidently standing behind your decisions. But I quickly came to realize that it also means never admitting error, even when an error has been made. A lot of companies still practice this, refusing to admit to customers that their product is faulty when they know it is, or that their service is lacking. They’ve had a nice run of it, but with the growth of social media, bad behaviour is no longer tolerated. Nowadays, it’s outed. Through mediums like Twitter, Facebook and blogs, injustices big and small are reported, discussed and condemned. For the consumer, it’s a fast, inexpensive and invaluable way to draw attention and get results.  For the companies that are not ready to evolve, the bad press can be devastating.

Remember back in 2009 when Canadian Dave Carroll’s guitar was broken on a United Airlines flight to Chicago? He tried to get the airline to pay for repairs, but was ignored, refused and then told to stop bothering them. So with his band Sons of Maxwell, he recorded the song “United #1” and posted the video to YouTube. In the first day it reportedly had 150,000 views. By the next day it had also prompted a response from United. The statement read:
“This has struck a chord with us. We are in conversations with one another to make what happened right, and while we mutually agree that this should have been fixed much sooner, Dave Carroll’s excellent video provides United with a unique learning opportunity that we would like to use for training purposes to ensure all customers receive better service from us,” (click here for more)

Dave Carroll also went on to record United #2 and #3. To date, United #1 has had close to 10 million views on YouTube.

In August 2010, a terminally ill child named Tanner Bawn flew Air Canada for a fundraiser in his honour. Upon arrival in New York City, his family realized that his wheelchair had been damaged.  His aunt, blogger Catherine Conners and author Scott Stratten reported the incident on Twitter. Air Canada was slow to respond, but the internet went nuts. The next day Air Canada released the following statement:

“We are deeply sorry that Tanner’s personal electric wheelchair arrived damaged at La Guardia airport, and we are investigating this. Despite several attempts to replace it temporarily throughout the day yesterday, we know that the only one that could do the job was Tanner’s own. We found an all-night repair service in New York, and are pleased to report that it has been repaired and delivered in person by one of our managers to Tanner this afternoon.”

Air Canada has since also offered the family a trip to Disney World, which is one of Tanner’s wishes.

In these two incidents, the proper channels did not work, or did not work quickly enough. Dave Carroll spent months trying to get acknowledgement of liability from United. When he got louder, through the megaphone of YouTube, he became unignorable and within days after going public with his story, he got results. Although Tanner relied on his wheelchair, the airline initially told him that it would be days until he could get a new one – long after the fundraiser was well over. Once the outrage spread across Twitter, however, the company found a way to help.

Although United and Air Canada staff may have followed corporate protocol, this was a blinders-on approach that made things worse.  Why does it take bad publicity to force a more human response? We all know what happens in personal arguments: If you have to yell to be heard, you have twice the amount of things to be mad about–and will need twice the amount of response or retribution to be satisfied.

These cases were big, but there are small examples of this every day. We see it when a company ignores our concerns or responds with a form letter from an unidentified staff member. Perhaps they mean to “frustrate” us into abandoning our complaint.  That’s not acceptable. It never has been, but now the customer has a method to fight back. Companies need to pay heed. As Laura Fitton, CEO of One Forty said in the MIT Technology Review, “Face criticism. Be apologetic if you need to be. People want to see you engaging with stakeholders and listening to their concerns.”

Apology alone is not enough. “Sorry” mumbled insincerely doesn’t mean sorry. If anything it means, “Sorry that I don’t look good in this situation” or “Sorry that I got caught”. When companies react quickly in a crisis, respond like a human being instead of a machine, respond directly to critics and respond maturely by taking responsibility, apologizing sincerely for the error and correcting what needs to be corrected….then customers will be happier and the company will potentially be stronger than ever before.  Ignoring issues or denying them just won’t work anymore. Times have changed and they are not going to change back.

 

Photo source: http://www.flickr.com/photos/pixelatedheart/3366734058/

The true marketing revolution (the prequel)

What’s in a word? A look at history to define the future

In the spirit of “no fear”, I’m prepared to start a series of posts discussing the history, evolution and proposed revolution of marketing. My premise – in this world that has pre-conceived notions about the bad and ugly of marketing – is that we need to redefine what we do. In many aspects, we’ve been trying to do this for years, but I’m not confident we’ve gotten very far. Just as we argue that businesses that sacrifice long-term vision for short-term gain will get left in the dust, I argue that if we continue to sit on an evolving definition of marketing, we will lose the true value marketing can really bring. It’s time to consider a revolution (not an evolution).

Over the next series of posts, I will present – what I hope will become – an exposé of where marketing came from and some thought starters on the marketing revolution we need to internalize, adopt and act upon. It’s time to start a movement.

In all good “movements”, history is a good teacher… so, let’s start by taking a look at our (marketing) history.

Some history of marketing

According to the online etymology dictionary, the term – marketing – dates back to the 1560s where it essentially meant, “buying and selling”. So, where sales was a matter of taking the wares you had and simply offloading them in exchange for some form of currency, marketing was a process where businesses – in their increased sophistication – bought from a supplier and sold to a consumer. Marketing was the “middle man”.

A number of academics: Keith, 1960; Dawson, 1969; Bartels, 1974; and Kotler & Keller, 2006, offered marketing “periodizations” as follows:

• Production
• Product
• Sales
• Market
• Customer

The idea, put into words by Robert J. Keith[1] in 1959, was that businesses – like Pillsbury – were created because of accessibility to raw materials and an idea from the founder. Companies were not created because there was a market need or desire. Over time, business people realized, like scientists before them, that the “centre of the proverbial universe” was not what they thought it was. Businesses realized that the consumer was at the centre of the market – not the business itself. This was news. From the new perspective, businesses built marketing departments and teams for each product; then each was responsible to grow their product(s)’ market.

Keith dubbed this categorization and period change: a “marketing revolution”; it shifted business thinking to focus on the customer.  Keith suggested that this new system worked; in fact “it worked better and better as maverick marketing men became motivated toward tonnage and profit”.

Even Keith, however, made it clear that his marketing revolution was not over – he closed his article with the following statement: “Soon it will be true that every activity of the corporation – from finance to sales to production – will be aimed at satisfying the needs and desires of the consumer. When that stage of development is reached, the marketing revolution will be complete.”

It’s now over 50 years later, and folks – we are not there yet. I say this because if the goal is to essentially get the entire organization rallied around satisfying the needs and desires of customers, I don’t believe we’ve achieved this goal. Do you?

Think about procurement. The role of the procurement department is to acquire goods and services at the lowest possible price point. I understand that I will get the argument saying that the point is not to transact at the lowest price point, but rather at the highest value; I’ll let you be the judge of whether or not that has actually transpired. In either case – lowest price point or highest value – the second argument will be that if the elements are purchased at said “best price” then the consumer’s end price is also at its lowest. Agreed. But here’s the issue – there is proof (to be discussed in later posts, but certainly that you can think of now) that consumers are not always looking for the lowest price. Consumers truly are looking for the highest value. And, to a consumer, the highest value is often determined by an intangible element that can’t be priced by traditional methods. How else do you explain the success of a five-dollar cup of coffee?

Now, if that is the case – that consumers seek high value – then the procurement department in its traditional sense, still in existence in some businesses today, is not rallied around the cause of satisfying the consumers needs and desires. Therefore, although Mr. Keith’s concept was born over 50 years ago, it has still not come to completion.

Even if it had, I would argue Keith’s closing comment – the marketing revolution will not be complete when the entire organization is aimed at satisfying the needs and desires of the consumer. In fact, the marketing revolution will only truly begin then… It will only begin because it will only be then that organizations will truly be able to be a genuine part of their consumers’ communities: not only aimed at selling their products and services to satiate, but aimed at making the communities they operate in better and sharing in the citizens’ duty of thriving for a better future.

The true marketing revolution will elevate the role of the business from making money to satisfying consumer needs and desires to making genuine contributions in their communities (local, national and global).

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[1] Robert J. Keith was Executive Vice President, Consumer Products area and a Director with The Pillsbury Company

Photo source: Philadelphia Courier-Post (Jan 3, 1996)