Branding Strategy Insider

Marketing Sense Versus Common Sense

Each year, hundreds of graduate schools of business turn out thousands of marketing people. When they arrive on the scene, these newly minted marketers want to make their mark. 

So they dismiss their advertising agencies and hire new ones. They revamp the marketing plans, even including new systems of compensation for the sales force. They change names, logos, slogans and strategy statements. 

Welcome to the world of marketing. This happens every year, usually around budget time. 

Actually, I didn't write those words today. I wrote them 16 years ago in an article published in the June 19, 1994, issue of The New York Times. Headline: "Marketers, Stop Your Tinkering."

That was also the year a USA Today panel of top ad agency creative directors named Little Caesars as the "best ad campaign of 1994." Maybe you remember the Cliff Freeman & Partners campaign. 

"Pizza. Pizza."

"Two great pizzas for one low price." Thanks in part to its brilliant marketing program, Little Caesars that year was the second-largest pizza chain in America. Here are 1994 U.S. sales of the four major pizza chains. 

• Pizza Hut: $5.4 billion
• Little Caesars: $2.1 billion
• Domino's: $1.9 billion
• Papa John's: $450 million 

The following year, the tinkering began, starting with a major tinker. The company converted 30 takeout units in the Detroit area to "Little Caesars Italian Kitchens." Besides pizza, the new menu included lasagna, chicken, Greek salads, dessert pies and three kinds of pasta (tortellini, penne and farfalle). By the end of 1995, Little Caesars expected to operate 100 Italian Kitchens. Needless to say, that never happened. 

Marketing And Happiness

Happiness is a hot topic these days. Scholars have recently noted some non-intuitive dynamics as to what makes people happy, and, of course, Americans are always in the pursuit of happiness.

Marketers rarely, if ever, talk about happiness directly, but in designing digital offerings that promise an "experience," or when focused on building customer relationships, the covert subtext of most advertising should be the creation of the feeling of happiness.

Must-Have vs. Want

A complication usually arises, though, when advertising creative meets the CMO's meat-grinder that tends to delimit brand into tomorrow's sales' numbers. Perhaps one way out of this dilemma is for marketers to note the difference - emotionally, experientially and cognitively - between consumers' must-ing and wanting.

Marketing Is Not Communications

 

A 5-page foldout magazine advertisement opened up with the following 39 attributes spread out over two pages: Renegade, fearless, unexpected, bold, true, spontaneous, curious, intriguing, unwavering, rare, brash, provocative, intuitive, genuine, daring, uncommon, irreverent, brazen, absolute, unusual, visionary, idyllic, proud, maverick, wild, undaunted, resolute, poetic, dynamic, soulful, unconventional, strong, romantic, authentic, brave, unorthodox, deft, radical, dreamer.

What brand could possibly combine all these wonderful attributes? Turn the page and get the answer: The 315-hp FX45. And who makes the renegade, fearless, unexpected, bold, true, etc. etc. FX45?

There in small type at the bottom of the next page is the answer. Infiniti, accelerating the future.

What’s wrong with this advertisement and thousands more just like it? It assumes that the primary function of advertising is to communicate. ‘Tell more, sell more’ was the old advertising adage.

The idea that advertising is a form of communications is deeply embedded in the corporate psyche. Many Advertising Departments are now calling themselves the Marketing Communications Department or ‘Marcom’ for short. Too bad. The name encourages advertising people to go in exactly the wrong direction.

The Obama Marketing Lesson

Nov. 4, 2008, will go down in history as the biggest day ever in the history of marketing.

Take a relatively unknown man. Younger than all of his opponents. Black. With a bad-sounding name. Consider his first opponent: the best-known woman in America, connected to one of the most successful politicians in history. Then consider his second opponent: a well-known war hero with a long, distinguished record as a U.S. senator.

It didn't matter. Barack Obama had a better marketing strategy than either of them. "Change."

Nazi propaganda chief Joseph Goebbels was the master of the "big lie." According to Goebbels, "If you tell a lie big enough and keep repeating it, people will eventually come to believe it."

The opposite of that strategy is the "big truth." If you tell the truth often enough and keep repeating it, the truth gets bigger and bigger, creating an aura of legitimacy and authenticity.

Holistic Marketing Explored

Holism is the concept that the whole has a reality independent and greater than the sum of its parts. Marketing people should pay more attention to this concept.

Take Tiger Woods' endorsement of Buick. On the surface, this might seem like a good idea. A young, charismatic, world-class athlete drives a Buick. How could this not improve the perception of the brand?

But wait. According to Forbes magazine, Tiger Woods made $115 million last year, including $90 million in endorsements. More money than any other athlete in the world. He owns a $20 million, 155-foot yacht. And he drives a Buick? Highly unlikely.

Nor is Tiger Woods' endorsement working in the marketplace. Buick sales in the U.S. have declined every year for five straight years, from 432,017 vehicles in 2002 to 185,791 vehicles in 2007. Last year, even Subaru outsold Buick.

Another point: If Tiger Woods endorses Buick, who is left to endorse Cadillac? God?

It's a stretch, but Tiger in a Cadillac is a plausible endorsement. To quite a few people, the best American cars are on a par with the best European and Asian cars. So if Tiger drives the "best" American car, it would be a Cadillac, of course.

That's holism at work. Look at the big picture, not just the details.

Marketing And Reality

The failure to understand the simple truth that marketing is a battle of perceptions trips up thousands of would-be entrepreneurs every year.

Marketing people are preoccupied with doing research and 'getting the facts.' They analyze the situation to make sure the truth is on their side. Then they sail confidently into the marketing arena, secure in the knowledge that they have the best product and that ultimately the best product will win.

It's an illusion. There is no objective reality. There are no facts. There are no best products. All that exists in the world of marketing are the perceptions in the minds of the consumers or prospects. The perception is the reality. Everything else is an illusion. Period.

Sponsored By: Brand Aid

Marketing, Memory And The Mind

Marketing people, and the minds of the people they are trying to influence, are often in conflict. Unfortunately, these arguments are being presented to minds that really aren’t up to dealing with all that glorious information. Our perceptions are selective. And our memory is highly selective. We are cursed with the physiological limitation of not being able to process an infinite amount of stimuli. This means that in a crowded category, your difference might not be enough unless it is a dramatic difference.

Seeing is not akin to photographing the world—merely registering an image. Memory is not a tape recorder that stores information when we turn it on. How much of your message gets through depends to a large part on what you are selling, according to years of data compiled on readership scores by advertising category.

For instance, an advertisement for footwear is going to be twice as interesting as an ad for floor coverings, regardless of the brand names or benefits. Similarly, an ad for perfume—almost any perfume—is going to have double the average readership of a furniture ad. There is even a ‘‘no-interest’’ category where people will remember no brand names. It’s caskets. The leading brand is Batesville. But after a few paragraphs, you’ll have forgotten this.

These interest levels—these biases—are firmly in place before we even pick up a magazine or newspaper. This is why the first and second brands in the market have an enormous mental advantage over the later entrants. They tend to preempt the most important differences.

Marketing Luxury Brands Q&A

Not too long ago I was interviewed by Amanda Tattam of Melbourne University's Up Close program. Here's the discussion that transpired.

Amanda Tattam
The massive growth of luxury goods has now extended deeply into China, India and other markets. Estimates vary, but some say the luxury market is worth between 60 billion and 20 trillion US dollars, including consumers who are trading up. That is, the increasingly wealthy middle classes, who 30 years ago, would have thought it luxurious to have two TVs in a household. Mark, can you explain how a luxury brand distinguishes itself from other brands?

Mark Ritson
The question today of what makes a luxury brand a luxury brand and how do we distinguish it is very hard to answer. The standard business response is to say, ‘they are more exclusive’. And we get exclusivity by having high price and relatively small amounts of the product available. The reality, however, of luxury brands is that they are sold in their millions, and in some cases, are not priced that much higher than the standard output. The only way I can really answer your question is to say, it is all relative. As you said in your introduction, it wasn’t that long ago in Australia that we would have considered two televisions to be a luxury, or even further back, one colour television. And you can make a strong argument, for example, that Starbucks in China, right now, is a luxury purchase – because of its cost, because of how frequently it is purchased by many people. So, I think the long answer is a complicated one, but the answer is, it depends who you talk to. I think in the business community what we would say, is that there is a small cluster of ‘more expensive brands’ which have a distinct strategy that we would identify as being ‘luxury brands’ and they start with the Rolls Royces and the Tiffanys and the Louis Vuittons of the world. And, I think that tends to be how we see them.

Amanda Tattam
Okay. So, what is the difference between ‘old’ and ‘new’ luxury for example?

Mark Ritson
It is an interesting one. It isn’t actually related to the age of the brands. So, two of the new classic luxury brands would be Coach, which is more than 60 years old, and in many cases would refer to Burberry, as using new luxury strategies. And Burberry is 151 years old. So, it isn’t their actual age. The term, ‘new luxury’ refers to a different approach to marketing luxury brands. A different approach in the sense that there is more focus on customers, greater production of the numbers. So, they might still have higher prices, but if you look at the typical Coach handbag, which is a well-known brand Japan, China and America, Coach would be making significantly more of it than the ‘classic’ old luxury brands like Gucci or Prada. And the final limit of new luxury which is of, I think, great distinction, is the new luxury brands have embraced production in China, far more so than the older luxury brands that continue to make most of their products, in some cases, in the traditional European artisan centres.

Brand Management From The Field

The Damned United, a film charting the tumultuous 44-day reign of Brian Clough at Leeds United FC, opened recently. UK Marketers under the age of 30 will probably remember him as a rather melancholy old man, but the young Clough was a wonder to behold. Imagine a manager today leading a club toiling at the bottom of the Championship to win not only the Premier-ship but two back-to-back Champions League finals as well. That was, in essence, the equivalent of Clough's astonishing achievement as manager of Nottingham Forest in 1979 and 1980.

He was a genius. But what can the Clough School of Management teach all marketers about marketing?

Keep it simple

Clough had a simple philosophy. He believed that defenders should defend, midfielders create chances and strikers score goals. There was little else to his tactics. His simple approach carried over to his coaching 'technique' in which he would stand on the training ground holding a big stick shouting 'hit the target' repeatedly at his players.

The simplicity of his approach was its biggest strength. As John McGovern, one of his players, explained: 'He made everything crystal clear to ordinary working men, which is what footballers are. If you make things clear to them and make them work hard, you will find you have an amazing product.'

One of the biggest weaknesses of some marketing strategies is their complexity. It's easy to come up with a brand strategy that no one can understand, much harder to devise one straightforward enough for everyone to be able to execute.

Take Procter & Gamble's chief executive, AG Lafley, who is widely regarded as a great leader. Under his 'Sesame Street simple' philosophy, brevity, repetition and simplicity have replaced complex corporate buzzwords. P&G's entire corporate strategy fits onto one sheet of paper.

Pick an enemy

Clough was a man who bore grudges. Throughout his career he picked fights with anyone he felt opposed his own viewpoint. His most famous feud centred on his hatred for the tactics of Leeds United and the club's most successful manager, Don Revie.

Testing Marketing Competence

It has been my experience that "marketers" are quite varied in their ability - from "clueless" to "brilliant." The problem is that many people can't tell the difference between these two extreme ends of the continuum. Here is a list of questions that should help you sort the wheat from the chaff. Ask these of the person in question. His or her answers should help you make up your mind where he or she belongs on the scale of marketing competency.

·Who is your primary target audience and why?

·What are the most efficient media and other vehicles to reach this audience?

·What is the best way to segment this market?

·What is your brand's top-of-mind unaided awareness among its primary audience?

·What is your brand's primary point of difference? Explain why it is compelling to your brand's target audiences.

·Why will your target audiences choose your brand over competitive brands?

·What are your brands "proof points" or "reasons to believe"?

·Please list or articulate your marketing strategies and tactics in decreasing order of effectiveness? That is, which would you invest in first, second, third, etc.?

·How much do you spend on PR as a percentage of paid media spend?

·Describe some of the insights that you have gained from research about your target audiences. What are their hopes, fears, anxieties, attitudes and values? Are there any insights that lead to a "hook" or "way in" to the target audience?