Where does the ‘essential essence’ of marketing hide?

Where does the ‘essential essence’ of marketing hide?

Jun 21, 2019 | Branding, Marketing, Strategy

 

Great marketing is never entirely rational.

If it was we would call it economics, and be bored to death by its recitation.

‘Rational’ relies on precision, mathematics, and repeatability, not characteristics often seen in the behaviour of human beings.  We are driven by automatic things buried deep in our brains that have evolved to enable our relatively physically weak species, to become the dominant species on earth.

Individually our ancestors could not beat off a sabre toothed tiger, but together we saw them disappear while we prospered. We are disproportionally attuned to detect danger before we detect happiness, a foe before a friend, and are initially suspicious of anyone from outside the ‘tribe,’ and anything we do not understand.

Great marketing is the opposite to rational. It demands attention because it is different, it creates curiosity, because it is unexpected,  and interest because it is of value.

Creativity is the core of great marketing, as without creativity, every marketing strategy would be the same.  All marketers have access to the same data, can apply the same logic to a challenge, use the same models,  have the same distribution, so if logic reined, all would be the same for the same sort of product.

Instead, we have a cornucopia of strategies and tactical implementations, driven by some level of creativity. These days, sadly, most of the creativity has been squeezed out by the algorithms and demands of the rationalists running enterprises,  which is why there is so much poor marketing and advertising around.

If you want to be seen, be different, cause a stir in the bushes, build curiosity, be creative!

It will not always work as you expect, as creativity is about being first, which is usually bold and risky, it will not always win hearts and minds in the corner office, but as a marketer, it is your duty!

 

Header cartoon from the great Hugh McLeod at www.gapingvoid.com

 

 

Algorithm groundhog day

Algorithm groundhog day

Jun 19, 2019 | Governance, Innovation

In 1911, Frederick Winslow Taylor published his book ‘The Principals of Scientific Management’, which used logic and maths to describe the pathway to efficiency. It shaped the practice of management for the next 80 years, until, slowly, we realised that not all behaviour was rational, able to be broken down in a binary way. In fact, most of our behaviour is not binary in the way envisaged by Taylor. It is shaped by the forces that have driven our evolutionary success, best described by Daniel Kahneman in his great book, ‘Thinking, Fast & Slow’.

Increasingly I am seeing and reading stuff that reflects the explosive growth of AI, and the impact it will have on our lives, working and private. I cannot help but wonder if this is another manifestation of the same mistake that Taylor made.

Artificial intelligence will be a huge boon to all sorts of tasks, it is way better than we mere humans at all sorts of things, but it cannot, at least yet, reflect the nuances of human behaviour, and reactions to the things that makes us a successful species.

How will AI deliver us the elements of pride and accountability we have in a complex job, when that job is broken down into a series of sequential tasks to be done by the ‘recipe’ without variation? Where does the insight and creativity that comes from doing such a job emerge when it is being done by the numbers generated by a machine?

My mother in law used to do paintings by the numbers, her unit had quite a number of ‘originals’ by famous artists, all done by the numbers, with great care and attention, and the application of considerable skill in attending to the minutest details. However, they were not the  originals, not even great copies of the originals, they were by the numbers.

Algorithms are great, but not at everything.

 

 

 

8 things to remember about that hugely persuasive data.

8 things to remember about that hugely persuasive data.

Jun 17, 2019 | Governance, Marketing

‘In God we trust, all others bring data’ . This statement is generally attributed to W. Edwards Deming, way back in the 50’s.

It is as true now as it was then, with some pretty significant caveats. 

You need to know the provenance of any data you choose to use, as data is just data, and it can be managed, coalesced, manipulated, misrepresented, and outright lied about, so be careful.

Some things to remember.

  • Data is mostly history, and the future is rarely the same as the past. Data that is really a forecast should not be called data, it is a ‘best guess,’ or wishful thinking,’ or ‘what the boss told me to say,’ or ‘I need this to keep my job,’ or a thousand other things.
  • Data is always incomplete no matter how complete you think it is. There is always some level of context that can give it greater, or even a different meaning, that is missing. Part of the challenge is being able to make a decision without being overwhelmed and developing a form of ‘common sense blindness’, caused by a tsunami of data.
  • Data provenance is always useful to know. What is the source of the data? When it comes from customers, it may be more useful than when it comes from a supplier trying to sell you something. When you see claims like ‘This lotion has been scientifically proven to cure male pattern baldness in 92.5% of cases’, you know the ‘scientific test’ was done on 10 hairy blokes from the local footy side.
  • Data is objective, but the analysis of data is not. It is subject to a host of human emotions and contexts, and can be interpreted in a number of ways, depending on the mood, experience, domain knowledge and a host of other things, of the analyser.
  • Data ages quickly. What was pretty right now, might not be so right in a years time.
  • The world is full of conflicting data, the challenge is to know which pieces to believe and use, and which to discard. Anticipating the actions of your competitor with the same set of data is a very useful exercise. Put yourself in their position and ask yourself what would I do now?
  • Data can distract, as we are visual animals, and visuals are a powerful way of communicating, so be sure that what is being communicated by those fancy graphs is actually what the data says.
  • Data should be able to tell us which is correlation, and what is simply some random causation. These two may be the two most confused states, and are certainly amongst the most used red herrings

Data should be one of the foundations of all our decision making, and we rarely have all we need. Therefore we are forced to make often difficult choices with limited data, implementing those decisions, measuring the impacts, and adjusting tactically as you learn. It pays to understand what you are relying on when you make those choices.

Cartoon header: courtesy www.XKCD.com

Blowing up 5 myths about strategy

Blowing up 5 myths about strategy

Jun 13, 2019 | Strategy

Strategy sessions are often seen as an annual, 3 day bonding session at a nice spot away from the usual distractions, with little application to the daily business.

Nothing could be further from the truth.

Strategy is not just about the long term.

A robust and effective strategy is cascaded into a series of increasingly detailed plans with actions and accountabilities attached. A ‘waffly’ strategy stuck on the foyer wall will do nothing, but a strategy that works will not just drive everything down to the daily level, it will perhaps more importantly, tell everyone why they are doing the things they are doing, and what their role is in delivering success. This contributes to a culture of collaboration and performance.

Sustainable competitive advantage is a dead idea.

 Nonsense! Identifying your competitive advantage and doubling down on it is more important than ever, simply because the pace of competition is so much quicker, and your actions are transparent to those who choose to watch. This makes it critical that you have an advantage, but that you also continue to enable its evolution at a pace quicker than the competition.  The key is the cycle time of innovation in the orbit of your competitive advantage.

Agility trumps strategy.

Strategic clarity enables quick decisions about where, when and how to be agile. Agility by itself may look nice, but is useless unless used to deliver value. Strategy is all about delivering long term value, being agile is a component of a robust strategy. It is a capability that enables you to move quickly within the established strategic framework towards an explicit goal.  

A Digital strategy is essential.

Digital capability is increasingly critical to commercial success, but digital capability is not a strategy, it is a contributing factor to a sustainable strategy. Do you have a telephone strategy? Business would not be able to be done without a phone, how about an electricity strategy? No? you may have a renewable energy component in your strategy because energy costs are important, and managing the technology a make or break capability, but in itself is a part of the larger strategy.

Strategy cannot accommodate disruption.

Disruption has become almost a cliché, an excuse for just about every failure around. Strategy is all about building a framework that will enable sustainable commercial success, and if that is  not about anticipating and leveraging disruption, amongst the other factors that drive long term success, I am not sure what is. The challenge is that disruption has suddenly emerged as the executioners block for those who fail to change at the radically increased rate over that required just a generation ago.  Pick any disruption you like, and you will see elements of it that  were both predictable and within the capability of the legacy businesses to leverage, if they had the foresight and capability to disrupt themselves. Being the big incumbents, arguably they are the best resourced to be the disruptors, but almost never do so. The bigger the ship, the harder it is to change direction. It is not disruption that leads to failure,  but the strategic failure to anticipate, lead, and leverage the disruption that leads to the failure.

 

My antidote to all this is to be continuously discussing and refreshing strategy by having it on the agenda at all times. Ditch the notion that it is set in an annual 3 day gabfest, and make strategic thinking a crucial part of your standard operating procedures throughout the enterprise. Strategic thinking should be on every agenda in an enterprise, and a general responsibility, not one reserved for the few senior managers.

Need some outside assistance, which most do, give me a call.

 

Photo credit: wiki commons.

 

 

What is the value of habit?

What is the value of habit?

Jun 11, 2019 | Customers, Strategy

Yesterday I filled my car with petrol. There are a number of petrol stations near me, but I tend to use the same one, by habit, without any real form of comparative pricing with other stations in the area.

It is convenient, is in a backstreet, the bloke who swipes my card is pleasant, it is an independent, so I just assume the price is OK without checking. None of that stupid discount applied if you have a supermarket loyalty card, where you know the price is inflated to accommodate the discount, a practice I find is as irritating as it is immoral, so avoid them like the plague.

I wonder how many of his customers just use the place habitually, without checking prices as I do?

Consider the implications of pricing on the profitability of the station.

I will not try and do the maths, as I do not know the costs or the volumes involved, but two questions are relevant:

  • How many of the customers are regulars, like me, who do not check prices?
  • At what point do regulars, like me, check prices, weigh up the other factors that influence our behaviour, and move elsewhere?

Would it be worth knowing the answer to these questions, and managing price accordingly?.

At some point, you will lose the price checkers, those who  chase the cheapest price on the day, and seem to be prepared to drive around looking for the cheapest petrol.

How many added cents/litre will motivate a habitual user, like me, to actually check the comparative prices, and move to a less convenient station?

If I was running this petrol station, I might consider putting in a system that in some way recorded the regulars, those who seemed always to use the station, and those who just used it occasionally, and then experiment with the price elasticity of the regulars, assuming that the price checkers will never come in unless you are the cheapest  on the day

An added cent to the price would probably not be noticed by the regulars, not drive any of them away (poor pun there) but would drop straight to the bottom line. If the regulars were 60% of your sales, it might well be a great strategy. It gets rid of the lines at the pump, increases the chances for interaction at the cash register, and that extra sale from the grocery and confectionery lines, which is after all, where a lot of the profit hides. 

Every business, no matter what it is, should consider deeply the drivers of profitability in their business, and pricing strategies should be number one on the list of considerations.