The lesson from Nurofen’s leadership folly

The lesson from Nurofen’s leadership folly

Dec 15, 2015 | Branding, Leadership, Sales

Reckitt Benckiser did everything right, and they did everything wrong with their Nurofen brand.

How can that be?

The ACCC has now successfully prosecuted Reckitt Benckiser in the federal court for misleading consumers with their Nurofen brand of painkillers, requiring them to pull product off the market within three months.

There will also be a fine, potentially a significant one to drive home the message.

In the process, years of investment in the brand will be trashed.

Who will ever trust Nurofen again?

On one hand, I have absolutely no sympathy for a corporation of any type that knowingly and deliberately perpetrated this sort of misleading communication. The writing has been on the wall some time after Nurofen won Choice magazine’s coveted “Shonky Award”  which garnered a fair bit of publicity at the time, including a star appearance on the ABC’s ‘Checkout” program. That Reckitts chose to ignore the ‘social warnings’  and voluntarily adjust their communication is a huge failure in leadership.

The marketing however has been very good over a long time.

Having run large corporate marketing departments, I can understand exactly how it all evolved.

An experiment with a brand extension generated added market share, consumer preference and retail shelf space at premium prices and margins. The marketing people responsible were recognised and rewarded by their employer and peers. Who would not take the next step, and seek new segments?

Back pain, period pain, migraine relief, et al, commercially seductive stuff.

Nobody would tinker with that sort of success. Anyone who dared to suggest that it was wrong, and they should walk away from the measurable short term success in favour of being a brand worthy of long term trust, a truly difficult notion to measure, would find themselves seeking other opportunities very quickly.

The failure is in the leadership of Reckitt Benckiser.

Reckitt Benckiser management simply  failed to reconcile the short term financial benefits of successful brand marketing with the long term benefits of having a brand and business that demonstrated leadership by building trust. They failed the basic test of personal leadership which is to do what is right, even when it is  not necessarily expedient.

Clearly the ‘leaders’ of Reckitt’s were there not as leaders, but as managers. They are undoubtedly good at managing the numbers, negotiating the deal, maneuvering amongst the corporate politics, but would you want them beside you when the going got really tough? Instinctively you know it would be all about them, they would  not ‘ have your back’

It is easy to forget that business is about people, not corporations.

People buy products from people, not businesses.

While we all talk about ‘relationships’ endlessly, particularly in the digital and social spheres that now so dominate our lives,  we tend to forget just how hard it is to maintain a real relationship.

One night stands are pretty easy, there is  no real personal investment, marriage is hard just because there is that investment required.

We should never forget the difference.

The mindset change for small business success

The mindset change for small business success

Nov 30, 2015 | Branding, Innovation, Small business

The mindset change for small business success

On one hand, digital tools offer small businesses the opportunity to look big, to compete with the big guys on a global stage.
On the other, small businesses have the ability to seek out niches that are too small for large business to be bothered with.
Innovation always emerges from the fringes. Clayton Christianson’s “Innovators Dilemma” maps the changes in a number of instances, sputtering inefficient little “Honda 50’s” bikes evolved to take over the motor bike markets, similarly, poor quality, cheap cars from Toyota evolved to replace the behemoths of Detroit.

Kevin Kelly’s 1,000 true fans article was one of the first to combine the ideas of the long tail and scale, positing that there was a spot at 1,000 fans that could be a living if you had that many raving fans prepared to buy what you had for sale.
In effect, the riches are in the niches.

I deal with small businesses all the time, and most will remain small because they do not want to engage with the idea of niches, the notion that they may be narrow but deep, and hard to find, but once found, they can wind their way around the world.

My son is a photographer, but old school. He uses black and white film with large and medium format cameras. Why does he bother in a world where everyone has a great camera in their pocket, why carry 20kg of gear over kilometres to catch a photo. Good question until you see one of the resulting photos, something that touches a place that the camera in your pocket does not know exists. It is a niche, probably a few dozen people in Sydney inhabit, say 30 in 3 million, infinitesimal, but take the 5 billion people in the world, and suddenly there is a niche way too small to be of any value to any of the photographic supplier companies, that has thousands of people in it around the world.
In those thousands there is a living, and riches of other sorts as a bonus.

Find your niche and mine it.

The ‘3rd leg’ of commercial sustainability

The ‘3rd leg’ of commercial sustainability

Nov 19, 2015 | Branding, Customers, Marketing

The “third leg” of commercial sustainability.

Most are used to looking at Revenues and Profits as the measures of commercial sustainability. However, there is a third and often overlooked leg, that is to my mind more important as it drives both revenues and margins resulting in profits.

Your brands.

The objective of every marketer is to have users that are apostles for their brand, those users who will go out and employ for you that most powerful of marketing tools, word of mouth.

There is nothing as powerful as someone you trust telling you that in situation X, use brand Y, it will never let you down.

In 40 years of observing how the best of the best do it, and being engaged in building some powerful brands for my clients and employers, there are a number of common  practices I have observed in the most successful.

Love your greatest fans.

Every successful brand has a core of users who just love the brand, and will not use anything else. This hold true from soap powder to cars, just go to Bathurst in October and try and persuade a “Ford” man that “Holden” is a better car. Identifying this small group of apostles and feeding their love will be the best investment you can make. Your ‘apostles’ will only be a very small percentage of users, but will have an inordinate influence on your success.

 

Create brand stories.

Humans relate to stories,  we remember them and the lessons contained in them. A brand story that resonates with your target audience has the potential to generate way more engagement and ultimately loyalty than a bland recitation of facts and figures.

 

Encourage customer feedback

Successful companies treat customer feedback, particularly negative feedback as an opportunity to both gather information on how to make their products better, and by addressing a problem turn a product sceptic into an apostle.

Positive feedback enables collection of data that identifies the roles your product fills in peoples lives, often uncovering factors that feed into the users emotional connections not otherwise easily discovered. My often repeated cottage cheese story is a prime example of this.

 

Anticipate needs

Market research is an enormously powerful tool, it can tell you everything you need to know about what customers are doing currently.

However, asking customers what they might want or need in the future is not a good use of market research resources.

Henry Fords quip that if he asked his potential customers  what they wanted, they would answer ‘a faster horse’ remains true. Steve Jobs did  not ask if we wanted a music player, and camera incorporated into our phones. Clearly we did not see the need, as the technical capability was there, the then dominant market leader Nokia spent fortunes on market research,  and there was no demand for it, but he just went ahead did it, and changed the market forever.

 

Books are judged by their covers.

Despite being told from a young age that we should  ‘never judge a book by its cover’, we all do, in hundreds of ways every day. People will make almost instantaneous judgements about your products by the way they look, the colours, layout, name, how it impacts their sense of order and design. For example, a predominately yellow design for a Chinese audience could be problematic, unless your service is pornographic.

 

Relationships are becoming virtual

In person, we can hold a maximum of about 150 relationships at any one time, Dunbar’s number. However,   many of us have way more digital connections than 150, and those  who have figured out how to create an online metaphor  for personal relationships, like Amazon with their  recommendation algorithms are cleaning up. Your customers are building their own versions of digital relationships, and you should be where your customers are.

 

Defenders may not lose, but they rarely win.

Brand defence is a necessary component of any successful brand, but it is not enough. To win you need to be on the offensive, take risks, big steps, shake up the status quo with innovation and remapping of markets. Apple over the last decade has had no peer at employing offensive brand building  tactics and is now the largest, most profitable company ever seen, from a basket case 20 years ago.

 

Love your employees and stakeholders.

Just like apostle customers, those with an intimate knowledge of your business because of some level of commercial engagement, have an enormous capacity to influence others.   If you knew someone who supplied a component into the Acme computer company, and you were considering a new computer, would you still consider Acme if your mate told you they were rubbish? The converse is equally true. Working with stakeholders will deliver great returns, and can be a source of great value as most businesses fail to recognise the potential so close to home.

 

Become ‘organic’ and highly adaptable.

Just as organic systems adapt to what is in front of them to maximise their chances of survival, so should your brand development activities and priorities.  Adapt, adapt, and continue to adapt.

 

The fundamental marketing things apply

Oct 21, 2015 | Branding, Governance, Marketing, Social Media

marketing fundamentals

Fundamental things apply

Great line for a song?

We all know the words, written by Herman Hupfeld from the song ‘As time goes by’, made famous in the movie Casablanca.

It also applies to marketing, particularly the explosion of techniques and tricks that have emerged with digital technology.

Despite all the rumors and offers of instant success, there is no algorithm for great marketing, no sure fire way of short-cutting the risks and uncertainty.

Great marketing takes time, effort, resources, curiosity  and a willingness to be different, to see things others have not seen, to create the uncreatable.

You do  not do that in front of a screen, the best you can do there is look at the results of stuff you have tried, get a superficial look at what others have tried, and manage digital development and deployment.

Instead of relying on digital bits to do the work, you have to get out and talk to customers, potential customers and others who may have an influence  on the way a product is produced, delivered and valued by customers, whether they be a consumer of a simple product or a major corporation making a significant investment.

The fundamental things apply, the same things that have always applied, they have not been replaced by digital tricks.

We can now deliver a message to a tightly defined audience, as small as one, but if the message is poor, wrongly targeted, the product fails to deliver value, you  may as well whistle in a hurricane for all the good it will do you.

Make sure the basics are covered, ensure the fundamental things that make a marketing program work are in place. There is no substitute.

VW’s marketing lemon

Oct 6, 2015 | Branding, Marketing, Small business, Social Media

Volkswagen advertising

 

VW advertising has helped redefine the practise of  marketing and advertising over 60 years, and in the process built a brand valued in their last balance sheet at $US23 billion

How much of that 23 Billion has been trashed by the unfolding fraud?

The value of a brand is made up of thousands of individual things over a long period, all adding to a disposition or feeling in consumers minds.

In VW’s case, it really started with advertising in the early 50’s, the original “Lemon” ads that changed the way we thought about advertising, to the more recent “Star Wars” ad series.

I wonder about the impact of the recent publicity on the new car buyer.

Will they now be more likely to add another brand choice to the list of possibles as they consider and research their new car purchase?  Will current owners be more or less likely to believe the message on the dash that tells them a service is now due?,

Every business from MNC’s like VW to the bakery around the corner has to be aware of the value of their brand, and the added vulnerability it now faces with the advent of social media, and its ability to generate commentary. United airlines found this to their detriment when they broke a songwriters guitar. This particular piece of payback has been viewed over 15 million times, spawned a host of parodies, song series, covers and even books, and it is a wonderful case study on corporate response to customer service for people like me.

Marketing people are now pretty quick to extol the virtue of social media as a tool to build brands, and some (the few who read balance sheets) even recognise the goodwill you can reflect in the accounts, but are they as vigilant on the flip side?

Rarely.

Investment in brands should be considered as a long term investment, something that will keep on delivering if you get the basics right and nurture it. For small businesses, they have the opportunity to appear to be much larger and sophisticated than perhaps they are if they think about the basics of brand building,.

Unlike physical assets, brands appreciate with use, care and attention, but the flip side is there as well, as VW has  discovered.

I will watch their next set of accounts with interest.

11 things Social Media will not do.

Sep 28, 2015 | Branding, Customers, Marketing, Social Media

Social media is not free

courtesy: Hugh McLeod Gaping void

Social media presents enormous opportunities for small businesses to connect with their customers in ways not imaginable just a few years ago.

However, like every new tool that comes along, it can be misused and certainly abused, and is certain to be touted by carpetbaggers. Considering the following list may save you some heartache.

  • It will not address failings in your band positioning and execution. Get those right, and Social media can be a great addition, but it will not backfill the failures of creative, customer and problem focused strategic thinking.
  • It will not make your brand interesting to potential customers who are not interested in what you have to offer.
  • It cannot help you when all you talk about is yourself.  People are more interested in themselves than in you, and unless you grapple with and answer the “What’s in it for me” question, you will end up talking to yourself.
  • It cannot guarantee to go viral. Very few things go viral, it is like winning the lottery, the more tickets, the greater the chance, but each ticket has the same chance as all the others.
  • It will not make up for poor content. In fact, poor content can kill any potential success your strategy may have, stone dead.
  • It does not operate in an objectiveless world, so cannot deliver on objectives you have failed to articulate and plan for.
  • It will not compensate for poor customer service. In fact, one of the great things is that those with poor customer service will be exposed quicker than ever, and go broke, reducing the ‘noise’ in the market.
  • It rarely seems to ignore the things you may rather have it ignore, like lousy customer service.
  • It will not change the world, although there is evidence that it can make a major contribution in that direction.
  • It is not free. Posting of social platforms may be free, but there is considerable effort and many challenges before you will have any chance of   being noticed. That effort will incur at least opportunity cost if you do it yourself, or professional costs if you outsource.
  • It does not just happen. Being good at leveraging the opportunities of Social media is like anything else, you can only get out after you have put in. Success always takes take considerable effort.

The message is that social media is not the panacea for anything, not a silver bullet for any problem, it is just a tool in the marketing toolbox. It might be new and shiny, and seemingly changing daily, and being touted as the next big thing, which to some extent it is, but it remains just a means to an end, not the end itself.