Decision time for manufacturers of ‘disposable’ items.

Decision time for manufacturers of ‘disposable’ items.

Mar 8, 2017 | Branding, Change, Small business, Strategy

I have used the term ‘disposable’ to mean that the consumers investment is low, so purchase risk is limited. Buy one and find it does not deliver, and little is lost.

Over the weekend I had a casual conversation with an acquaintance who runs a small business selling such a line of disposable consumer products into a niche via specialist chain retailers, many branches being franchised, so are somewhat independent.

His problem is that he is being overrun by the scale of the retailers who take his ideas and have them fabricated in China under another brand at prices he is having increasing trouble matching.  In any event, they also control shelf space, so he is at their mercy.

Not an uncommon problem.

My rather glib response was that he was trying to sell to the wrong people. His current customers, the retailers, were not actually his customers, in fact they were more like adversaries. His real customers were the ones who had a need that his products fulfilled, and the retailers were just a logistical barrier to be managed and overcome.

The retailers see the only value in his products as a range they should carry as an occasional addition to the customer basket  at the cheapest price that meet their margin requirements. For them there is no investment in the success of the product, and little downside.

To the real consumers however,  the question of whether they outlay $8 or $11 for the items is largely irrelevant once the buying decision, often impulse, has been made. There is little brand awareness or preference involved, there has been only modest marketing investments made, the sales come from demonstrating the utility of  the product.

My advice: Set up an online shop, and actively market to the identifiable groups of customers who would benefit from using his products.

As he has a limited budget, and little brand recognition, this is potentially a make or break decision, not to be taken lightly.

Retailers will be even more disinclined to stock his products when they see him actively competing with them on line, but on the other hand, his sales volumes have been dropping steadily for some time, and the costs of doing business are increasing, so the end game is in sight.

The flip side is that the product is ideally suited to selling on line, the value is demonstrable, it is easily sent via the post, and the margin freed up by selling direct would be considerable.

A change of this nature would be uncomfortable, but I suggest the only way the business will continue to prosper, and have any value when the current owner decides it is time to retire.

Does yours fit the consumer definition of ‘Disposable?”

If so, what are you doing about it?

 

Why the accepted notion of ‘Brand Loyalty’ is rubbish

Why the accepted notion of ‘Brand Loyalty’ is rubbish

Mar 6, 2017 | Branding, Customers, Marketing

Brand loyalty, and one step further, finding those few  users of the brand who will use no other, and demand their networks do the same, is the holy grail of most marketing. It comes up in almost every marketing brief ever written.

However, there is almost always a flaw in the logic I see used.

Heavy and exclusive use of a brand is interpreted as brand loyalty, and occasional users are disregarded except as a possible opportunity to increase usage, if they are even picked up in the data. Consumers usually have a small pool of acceptable brands, and expect to be satisfied by the product they buy, whatever the usage, or they do not return. The brand is just one of the the filtering mechanisms of varying strength they use to make the choice easier.

While loyalty and heavy usage may be in a very few cases generated by the brand, it may also be that the heavy usage is just habit, availability, convenience, the shape of the package, or many other factors other than a behaviour changing loyalty to the brand.

Heavy usage and brand loyalty do not always have a cause and effect relationship. There is certainly a strong correlation, not necessarily causation.

My father would only use one brand of mustard powder, a blindingly hot concoction he used sparingly on an occasional sandwich. The stuff was only purchased once every blue moon, as he was the only one in the household who would go near it. Far from heavy use, but very loyal.

Conversely, if you look in my sisters fridge, there is only ever one brand of natural yogurt, and she consumes a kilo or more a week, in a number of ways. However, the choice is driven not by  the brand, although it is entirely satisfactory, but by the fact that the small supermarket she stops at every couple of days on the way home because  of the easy parking and friendly environment, to buy her milk, and a few other staples, only carries that one brand. Convenience drives the purchase, not loyalty.

Anyway, the nonsense that gets touted around by snake-oil sellers about consumers wanting to have a relationship with their brand is just so much crap it makes me sick. Brand loyalty is a rare thing, and is always, always given as a part of a whole package of value that is delivered consistently by the product to the consumer.

Consumers want a lot of things from  their favoured brands, but only a very few with some sort of emotional incapacity see a brand as a substitute for a human relationship, so lets stop talking about it as if it were.

My thanks again to Tom Fishburne.https://marketoonist.com/ When I went looking for a visual for this post, this cartoon says it perfectly.

 

How to send a great brand down the crapper.

How to send a great brand down the crapper.

Feb 22, 2017 | Branding, Social Media

When you change your business  model, make sure you take your customers with you. Just assuming loyalty and the power of incumbency can be terminal. The evidence to this is long: Kodak, Blockbuster, and more recently, Blackberry, amongst a very long list.

A few customers will hang around, even to the death, but most will walk just as soon as a viable alternative emerges, and in the meantime probably think you have overindulged in happy-juice, and think way less of you for it.

Not many would see this as a good outcome in the challenge to build and leverage a brand.

LinkedIn has been a great success, making its founders billionaires, early investors multi millionaires, and enabling business connection and networking in ways unimaginable just half my working life ago.

The freemium model they used worked well, it gave significant levels of usage for free, which hooked in a huge, professional user base.

You did get a lot for no financial cost, but in exchange, you did give them a lot of information.

Your personal details, work history, interests, location, affiliations and networks, and a lot more, all of which should have been an advertising bonanza, and if I asked for it when interviewing face to face in Australia, I would be breaking the law.

This information is  the quid pro quo for the use of the platform, and unless you are really stupid, you know that it will be used to sell access to that information to anyone with the money, who wants to reach you.

Nobody would seriously argue that this was not the case.

Facebook has made a huge success of advertising to finely defined audiences based on the personal information given in return for access to the platform. That LinkedIn failed to do the same, with the significant added value that could be accessed via the subscription versions, is their marketing failure, not evidence that  there was not an opportunity waiting to be grabbed.

Anyway, at some point, some of the users of the free version needed to go a bit deeper, to be able to search in a more targeted manner, so they happily upgraded to one of the premium packages. While the subscription revenue may have been under what it could have been, LinkedIn seemed never to really set out to market the benefits aggressively to their user base, all they did was offer a months free access to the premium version.

As LinkedIn seeks to generate revenue by annoying its users, Facebook jumps into the markets to date dominated by LinkedIn and offers similar services to its huge user base. Serious competition? Not too the differentiated Linkedin, but perhaps now it is.

I was a constant advocate of LinkedIn, and strongly encouraged and coached all those I worked with started to use it, some migrating to the subscription services. That advocacy is now gone, and I am sure that I am not the only one.

How long before the first cat photo turns up? Perhaps it already has, further blurring the differentiation LinkedIn used to have to Facebook and other social platforms.

I get that Microsoft needed to create a return on their $26 billion investment, but ignoring your market is a pretty stupid way to go about it.

Perhaps the new bloke who has admittedly made some pretty smart moves since he took over from Steve Ballmer, should have rung Jeff Bezos at Amazon who may have reminded him that Amazon keeps an empty chair at every meeting as a constant reminder that they are there to serve customers, not the  other way around. Do that successfully, and you will make money, fail to do it, and the bell will eventually ring.

The upside for the few really effective marketers out there is that a really effective automated toolbox has been removed from the wannebe’s, so creative, differentiated, focused and truly customer-centric  marketers will have more oxygen.

 

Case study: The pros and cons of PR in a B2B market.

Case study: The pros and cons of PR in a B2B market.

Feb 15, 2017 | Branding, Customers, Marketing, Strategy

PR can be a remarkably effective tool in the marketing arsenal, but most of it is just wasted, simply because it is not delivering any message of value to anyone who cares.

What can you expect when you have a combination of PR agencies who get paid by the word, various supposedly credentialed dills with a barrow to push who like to see their names in print, and politicians who will respond to the smallest of pressure groups who make a big noise?

The latest target of the word churners is sugar, specifically sugar in soft drinks,  but more broadly, sugar in everything.

Tax it and the problem will go away.

Nonsense.

While it is true that in economics 101 I learned that when you increase the price of anything, you sell less of it, this is a logical outcome based on an assumption of rational behaviour.

If I have learnt anything about consumer behaviour in the 45 years I have been in the marketing game, it is that it is rarely just rational, and unlikely to be altered by well meaning press releases, full of adjectives and promises of better days, written by those with a dog in the fight.

I was recently asked by a former client who supplies high value but very low usage ingredients that have the  potential to replace some of the functionality of sugar in food products for an opinion on a couple of different PR approaches they were considering in response to the discussion about a sugar tax.

Following is the reasoning I offered on PR as a marketing tool in this situation, sanitised for more general consumption.

  • There is a political problem, we are all too fat, therefore there is pressure on governments to regulate. Some of this regulation is warranted, such as the disclosure of the calorific value of products, in this case soft drinks, some is just nonsense.
  • We all (should by now) know that soft drinks are full of sugar, and drinking them to excess makes you fat, as well as having other health impacts. Therefore ensuring that label regulations are clear and understandable to laymen is a good thing, resisted by the beverage companies, as they do not want to scare the horses.
  • We cannot expect (in my view) governments to regulate for our behaviour, to be the gate keepers on our fridges. However, the tendency seems to be to seek to regulate to protect people from themselves. This is the guts of the move to have a tax on sugar, but underneath, there is a revenue measure for government that they will not talk about, but remains.

For a business to successfully leverage the public discussion for their commercial purposes requires some sort of strategy, and what I often see is a strategic vacuum, into which a PR release is sent. Some thoughts on the value of PR in these circumstances to a business that has some sort of vested interest in product formulation in the beverage market :

  • The target market for information is the marketing and technical people in beverage manufacturers, and they require different messages entirely. If it was me, I would have a plan with a few simple elements, and execute on the plan.
  • Create a list of the beverage manufacturers in each market, along with the relevant information about their ownership, location of factories, brands, strategies, etc, all you can reasonably glean from the combination of public documents and what your sales force knows. This is part of what marketing departments in businesses  with these sorts of interests should be doing.
  • As part of the above, ensure there was a list of the personnel in each business, their role in an organisation chart, and more importantly their role in the marketing, procurement, and product formulation decision making.
  • Develop ‘content’ with credibility to support all sides of the debate, and make all the data available, not just the bits that may support your commercial objectives. Research by the likes of Tate and Lyal, and CSR will be viewed with suspicion, irrespective of the science of it, because they have a vested interest, unless they discuss all the data and both sides of the debate.
  • Use the lists developed above to target selectively the people you need to speak to with the commercially agnostic data (content) you have developed. Do this digitally to create MQL’s (marketing qualified Leads) which are then passed to Sales and Technical services to follow up in person to make your formulation and commercial arguments.
  • Pick a small number of real target companies and devote resources specifically to the task of selling to them.  I would pick the challenger brands in each market, the ones you can sell to without the regional head office being involved, those who do not  have the big marketing budgets and brands, so they have less to risk. Once you convert a small number, and they have success in the market, the rest will follow.

This is pretty basic marketing 101.

Recognise that your target market is specific, and sales intensive, not marketing intensive. You are not selling toothpaste to a consumer with a low transaction value and regular small transactions, where marketing is vital. You are selling high value ingredient to customers where there is a high degree of specification, complication, and a long term relationship at stake. The challenge is different. Wasting time and effort, as well as money on consumer PR is useless in this context except as a strategy for keeping the wallies who do not understand the basics of the sales and marketing of their businesses quiet.

 

To cut through the digital clutter:  Tell stories.

To cut through the digital clutter:  Tell stories.

Feb 13, 2017 | Branding, Marketing

Stories are personal, they resonate, you see the real people behind the business, not some nameless corporation, the people who do the work, and are accountable for  the decisions and outcomes.

Facts never change anything, but stories can.

Martin Luther King did not recite a list of the facts surrounding the deprivations and discrimination of the American negro in his 1963 speech, he told us of his dreams, and changed the world.

Facts are boring, stores are listened to, part of our DNA, we listen to stories and relate to them into old age.

 As a kid Dad read to us from what became known as ‘The weekend book’. A book he had been given as a kid, of the Greek legends. I saw that book again for the first time in probably 40 years last weekend. My sister had it carefully stored, as it is now falling apart from almost 100 years of love and use. She has kept the family tradition alive by reading the stories to my niece, who is as familiar and engaged with them as I was at her age. As I turned the pages, every page, story and picture was as familiar as if 55 years had not passed and I was 10 again, listening to my dad reading them.

Stories allow you to differentiate in an emotive and highly engaging way. Your story is yours, not your competitions, yours. They can be used to give potential customers a reason to go nowhere else, they give you a personality that cannot be erased with a cheaper price, or a hyperbolic sales pitch.

Tell stories

I am currently working with a medium sized printer, a 60 year old business founded by the current MD’s father in the mid 50’s. In a recent move of premises, sitting in the corner was the original little printing press that he had used to start the business,  about to be sent to the tip. Aloud, I wondered at the stories it could tell if it could talk. That press now holds pride of place in the foyer of the new premises.

We trust those we know, and we get to know people by hearing, understanding and relating to their stories. Facts simply do not  build trust, they bring enlightenment, and understanding, but not trust.

Tell your stories, you may be surprised at who is interested.

The A – Z of personal branding

The A – Z of personal branding

Nov 2, 2016 | Branding, Marketing, Social Media

In 1997, Tom Peters wrote an article for Fast Company,  titled ‘The brand called You’ which was probably the first articulation of this idea. In it he wrote  ‘It’s time for me — and you — to take a lesson from the big brands, a lesson that’s true for anyone who’s interested in what it takes to stand out and prosper in the new world of work’

Most people think about personal branding as a result of necessity. Suddenly they find themselves between jobs or careers, and recognise for the first time the need for branding, of the personal type. Usually that is the second best time to start thinking about it, the best time was years ago.

The nature of work is also changing, lifetime employment is a thing of the past. No longer are there any ‘safe’ jobs, economically and socially we have recognised that we need to look after ourselves, and the digital revolution has provided the tools to do so. The book End of Jobs is a compelling read, and persuasively makes the point after having looked at all the research. In these circumstances, you have become a commodity with something for sale: your time, expertise, experience and connections. In order to get the best price for that commodity, the lessons learnt over 100 years of product branding can be applied to personal branding.

The standard 4 step brand planning process that works for soap, also works for you.

First: What is the current ‘brand’ position? What do you do well, what do you do poorly, how do others see you, and what do they say when you are out of the room. You may need to ask a few friends and acquaintances for the honest truth, and be prepared for some surprises.

Second: What you would like it to be?  You really need to think hard about how you want others to see you, leaving it to chance is not usually a good idea.

Third: How do you set about bridging the gap. Once you know the objective, you have a chance to plan and execute activities that contribute to the achievement of that objective.

Fourth: Implementation. This is the hard part, being proactive, consistently, over time, while reviewing and revising as necessary.

There are some pretty simple steps that can and should be taken by every professional to effectively implement a personal branding routine. None of it is particularly challenging, but does take a little bit of time.

  • Register your name or digital handle as a domain if possible, but you need an ABN in Australia to register a .com.au domain. Without an ABN, make sure you claim the ‘domain’ on the social platforms, particularly LinkedIn. Each platform does it a bit differently, but it is worth the small effort to figure it out. In my case, I have allenroberts.com.au and StrategyAudit.com.au as my domains, and Strategyaudit is the handle I use throughout the digital channels to give me leverage.
  • Apply disciplines to yourself. Having determined the sort of brand you want, ensure that everything you do on line adds a little to the project. No cat photos on Linkedin please, and have a separate Facebook page for your brand if you feel compelled to post those photos of yourself being compromised in some way. Best not to be in that situation at all now that everything is potentially public, no matter how hard you try to be private.
  • Build a library of content that reflects what you are good at, and what you like to do, the sort of things you would like people to think of as ‘yours’. This does not necessarily have to be extensive, but it has to be curated and representative of your personal brand. Spreading the content across platforms gives you leverage, and an opportunity to repurpose the things that work well for you. In my case, the primary vehicle is the bank of 1400 plus blog posts on the StrategyAudit website, as well as an active presence on Linkedin, Facebook (as StrategyAudit) Twitter, and other digital platforms.
  • Every digital platform is different, serving a different purpose for its users. It is reasonable therefore to vary the branding approach. Different narrative, photos and content are the start.
  • Recognise that ‘browsers’ of platforms see ‘headlines’ just like the old days of newspapers. They may move beyond the headline, dig a bit deeper, if their interest is piqued. In most cases, your photograph is a significant part of your headline, so having them taken professionally makes good business sense. Many skip this simple step, as it is so easy to take your own and just upload. However, it is nowhere near as good as having a session with a professional. It will also give you options of using different photos on different channels, reflecting the character of the channel and yourself.

I recently had a session with Sam Affridi from Hero Shot Photography, a photographer I met through a business network. He suggested I rethink my headshot and the message it’s giving to my different audiences. As a result of the conversation, he took a series of photos for me, all designed to better reflect the differing messages I try and send on different platforms. He did a great job, and I now have a ‘bank’ of different shots that can be used as an additional communication tool in my headlines in various  digital spaces. This replaces the one photo I had, that at the time I felt was pretty good but had over time proved to be sub optimal. It was enlightening to see how much thought went into the session and how my ‘brand’, what I want my clients and potential clients to feel about me, was a deliberate element of each headshot. As Sam puts it “creating a flattering portrait is the easy part. Creating one that’s specifically engineered to appeal to your ideal customer is worth spending time on” If you’re looking for an update, I’d give him a call and please do mention my name.

 

hero_shot_sydney_strategy_audit-9 hero_shot_sydney_strategy_audit-10 hero_shot_sydney_strategy_audit-8 hero_shot_sydney_strategy_audit-4

 

 

 

 

While it seems a bit narcissistic to have 4 of the many good photos posted, these all say something different about me, or at least I think so.

What do you think?

Commercial environments evolve, sometimes very fast, and staying still is death, which is why the successful brands are allowed to evolve in response to the job they are being asked to do. Similarly with personal brands, we have the opportunity to evolve what we do and say in line with the progress of our lives, but it should be a managed process, not one left to adhoc activity and chance. Developing your personal brand can be time consuming, and is necessarily an incremental activity, but putting aside 30 minutes a week as your investment in yourself seems pretty sensible.