Unless you’ve been hiding under a deep dish pizza here in Chicago, you know that Transformers 3 is filming in town.  Stuntmen have been parachuting off of the Trump Tower, guys in military uniforms have been conducting mock machine gun battles in the streets, all while Director Michael Bay and crew blow up stuff on Wacker Drive. It’s been pretty cool and we’ve got a great view of the carnage from our office.

But it seems some are questioning the tax incentives that have made productions like this possible. This excellent article by Kathy Bergen at the Tribune sums up the issue nicely. I would encourage you all to read it. However, its certainly clear to me that the jobs created and the amount of money spent in Chicago on productions like this far outweigh any potential negatives. And, full disclosure, as an actor I’m delighted to see it. Other productions are in town now and more are coming soon.

So all that is awesome and great for the local economy!

But I would argue that the hidden, non-quantifiable, long-term benefits are even better for the marketing of Chicago. Visit Chicago today and you’ll see a modern American city (with some noticeable exceptions of course like our mass transit system), with a beautiful lakefront, an inviting downtown, and gleaming skyscrapers. It’s a place where anybody would love to make a film.

But it wasn’t always like that and not so long ago either. Everybody has seen the “Blues Brothers” of course, but if you haven’t seen it in a while, go back and watch it again. You won’t see today’s Chicago in that film. You’ll see a tough, gritty, dirty city with old guys living in tenements asking for their Cheese Whiz. In many ways, it’s the Chicago I remember growing up with.

So what changed? Well the “Blue Brothers” introduced the nation to Chicago. And despite the grittiness of the movie it made our culture shine. The music, the cuisine (“Wrong glass sir.”), the neighborhoods, Lower Wacker Drive, the architecutre, and Wrigley Field were all things prominently featured that made people want to come here.

Chicago looked cool! Even today, thirty years later, I have friends from out of town who want to visit this place or that because they saw it in the “Blues Brothers.” If you’re from Chicago, tell me you haven’t taken pride in driving a visitor down Lower Wacker Drive just like the Blues Brothers did. People from all over the country now know what’s located at 1060 W. Addison. The Blues Brothers are such a part of our cultural fabric that you can’t imagine Chicago without it. That’s pretty powerful stuff for a movie.

Now am I saying that the “Blues Brothers” is responsible for the transformation of Chicago to what it is today? Of course not. But it was a critical factor. And many of the movies shot here since were also critical factors in the evolution of the Chicago brand. These productions and future ones are vital to the city’s growth.

So to Michael Bay, Ron Howard, Stephen Soderbergh and our Hollywood friends I say thank you, please come again, and please encourage others to shoot here. Chicago’s reputation flourishes and its brand beams the more you’re here.

Oh, and one other thing…while you’re in town, could one of you guys please call my agent?

A recent Wall Street Journal article reports on yet another use of promotion marketing for a purpose no one dreamed of before. In New York City, the Maloney and Porcelli Steakhouse is using free steak dinners and access to an open bar to motivate workers on a nearby noisy, dusty construction project to finish their work by the November deadline. They even have a Construction Club website tracking progress toward work goals and worker rewards.

Back in the 1980s, when my colleagues and I were toiling away in the promotion marketing mines, sweepstakes, refunds, free premiums and so forth were a specialty area then, mostly used by consumer products marketers.

Who knew they would they would get into the mainstream, used as tools in government, economic policy, law enforcement and social engineering today?

We touched on this subject in a previous post about Michigan credit unions’ Save To Win program offering one entry toward a $100,000 prize for each $25 saved, and a New York City “promotion” rewarding poor people with cash incentives for visiting the dentist, opening a bank account, and so forth.

Since then, in addition to the Maloney and Porcelli Construction Club, we’ve run across:
•    The U.S. government SAVE Award, an OMB (Office of Management and Budget) contest that honors federal employees for ideas that save taxpayer dollars. Winners get to meet with the President. Unfortunately, they don’t win any “dead Presidents” to put in their pockets.
•    A Harvard experiment that bribed kids for getting good grades – a larger, more sophisticated, controlled version of the old “get a dollar for each A on your report card.”
•    The recent Cash for Guns program right here in Chicago. In just one day, it got over 4000 weapons off the street.
•    And of course, the ever popular police sting “party” tactic. Police invite criminals to win big prizes at a special VIP event, then clap on the cuffs when they show up. This idea has gone international; here’s an example from Thailand. (Don’t crooks ever read the paper or watch the TV news? By now, they should see this one coming from a mile away.)

Two questions:
1.    Have you run across other cases of promotion tactics used to support government programs, social engineering, and law enforcement (rather than to sell products or services)?
2.    When does it make sense to “pay” people extra, to do what they’re supposed to do (or what we hope they do) anyway – save money, have responsible habits, work more efficiently, get good grades, prevent crime and so forth?

“Power corrupts and PowerPoint corrupts absolutely,” said Vinton Cerf, the so-called “father of the Internet.”

Maybe he was talking about what marketers go through, to take a marketing initiative from germ of an idea to a campaign that drives business in the marketplace.

At the end of the campaign development process, we know how important it is to develop clear, persuasive and exciting communications to our target audiences. So you’d think we’d be better at communicating to each other – our clients and colleagues – during the process.

But you’d be wrong. Marketers keep using PowerPoint to communicate with each other. People yawn. Their eyes glaze over. They miss the point. Clear, simple ideas become complicated. Complicated ideas pretend to be simple. And the power of a great idea goes unrecognized.

And we’re not the only ones losing power and missing the point because of PowerPoint. A story in the New York Times reports how “death by PowerPoint” has become a running joke in the U.S. military. “PowerPoint makes us stupid,” said Gen. James N. Mattis of the Marine Corps at a military conference, (He spoke without PowerPoint.)

The problem is not PowerPoint itself. Instead, it’s the user assumption that slavishly following a formula of formats, condensed copy, bullet points, and elaborate charts and graphs will somehow lead to people understanding and being inspired. It gives us the illusion of well-organized, rational information flow leading to effective decision-making. But what happens is usually just the opposite, as illustrated by the famous (notorious?) Gettysburg Address in PowerPoint:
Agenda
•    Met on battlefield (great)
•    Dedicate portion of field – fitting!
•    Unfinished work (great tasks)

Mea culpa –I too am guilty of sneaking a nip or two of the addictive elixir of PowerPoint. That’s why Robinson & Maites has replaced conventional PowerPoint with a storytelling format for many of our presentations.

And it’s why I’m proposing the creation of PowerPoint Anonymous, complete with its own 12-step program to wean PowerPointy Heads away from their addiction. Note that we’re talking 12 points here, not 12 bullet points. Some of them are:
1. Admit that you are powerless over PowerPoint—that your presentations have become unmanageable.
2. Believe that there is a higher Power than PowerPoint that can restore you to sanity.
3. Make a searching and fearless moral inventory of your bullet points, content condensed to the point of meaninglessness, charts, graphs and so forth.
4. Make a list of all the colleagues and clients you have bored and confused, and became willing to make amends to them all.
5. And so forth.

Are you ready to take the pledge, to wean yourself from PowerPoint?

Imagine this: Your competition’s new loyalty program is a big success. Sales says some of your customers are already switching over, to get in on the rewards. You can see your share shrinking.

Should you launch your own program? Maybe not, if your definition of loyalty program is:
•    The all-too-familiar “earn points for purchases, then redeem them for merchandise items, gift cards or other rewards.”
•    Or the been-there-done-that “show this card and get a discount every time you buy.”
Because the biggest problem with loyalty programs today isn’t that your competition has one. Instead, it’s that everyone seems to have one.

According to Colloquy, participation in loyalty programs has jumped 19% in the U.S. since 2007, and over two-thirds of all U.S. consumers report that they still participate actively in at least one reward program. When it seems like most marketers have a loyalty program, and most customers participate in one or more, the perceived value of all the programs is diminished.

How do you break away from me-too loyalty marketing? Start by asking:
1.    What does it mean – how do you define and measure loyalty for your brand? It could be simple preference or willingness to advocate to your brand to friends. Or it may be a harder measure, like maintaining or increasing share or purchase frequency. Then ask yourself: Can a conventional points or card program really achieve these objectives?

2.    What’s the right balance between value and excitement in a loyalty program? Conventional points and card programs need to offer an array of gift cards, digital cameras, discounts, etc. because they need to assure obvious value to a wide range of customer tastes. But they also need a way to differentiate from all the other programs offering the same things – unique items and services and exciting experiences, even if their appeal is specialized or its quantities limited.  American Express does it by offering members concierge service to find gifts and hard-to-get event tickets. And the Chicago Tribune ChicagoPoints program all kinds of ways to earn rewards points: survey completion,  trivia questions…even for correctly answering questions stories in the newspaper.

3.    Can a program member generate enough revenue to support a program with meaningful rewards? This is a big problem for low-ticket CPG products, where annual revenue per customer is small. Tropicana may have solved it by using OPM – other people’s money – in a Juicy Rewards program that offers high perceived valued savings on partners’ products and services: TaylorMade golf clubs, Adidas shoes, Coleman camping supplies, Norwegian Cruise Lines and more. In this program, Tropicana supplies the communications/distribution network, and partners supplies the rewards.

But a true breakthrough will come from realizing that there’s more to “loyalty” than “bribes,” and that relevance is more important than rewards. The ultimate example of this comes from Nieman Marcus, where customer service, limited membership and soft rewards (exclusive services) are the foundation of a loyalty program. This is  a perfect fit for rDialogue’s definition of true loyalty marketing: Rewards are just a starting point, and the “the real value of loyalty programs lies in their ability to engage customers and enable relationship marketing.  This is where executing marketing activities based on customer data creates marketing excellence, not simply program excellence.”

I missed it! March 19^th was the first National Day for Unplugging, an event designed to celebrate the Sabbath by asking people to give up, for 24 hours, use of cellphones, GPS, computers, TV … in other words, most of life as we know it. But then, the very nature of the day is contrary to finding out that it exists. It’s an intriguing idea, given the all-pervasive technology surrounding us. Apparently, some participants struggled, while others found it refreshing.

The idea of staging events on specific days or weeks has been around for many years. We have National Popcorn Day in January, as opposed to National Popcorn Poppin’ Month in October (popcorn brands take note – a little marketing integration needed here).  Next month, May, prepare yourself to celebrate Teen CEO Month (scary), Tennis Month (Alan Maites take note), as well as Revise Your Work Schedule Month (less for me, more for you), National Vinegar Month (eeuuhh), and National Meditation Month (ohmmmm).

Now clearly getting a day or month event to work effectively in marketing requires more than just saying this date or this period is “yours”.  First you need an official sponsor, a marketer to pay the bills. And you need to host some events, get some publicity, have others talk about it and join in the fun/celebration/remembrance.

To add to the ideas above, I’ve thought of a few examples of technology-inspired National Days:
1.  National Day of Unfriending – One day when you can un-friend as many of your 1356 closest Facebook friends as you like, without getting hate emails. But you could send snail mail – maybe the U.S. Postal Service should sponsor this one.
2.  National Day of Twittering – A 24 hour period when you need to twitter ABSOLUTELY EVERYTHING you do, staying awake all night to detail every tedious aspect of your existence.  This could be a charity fundraiser for On And On Anon Ymous, the 12-Step program for people who talk too much.  Or another excuse for people to behave like Chad Ochocinco.
3.  National Erase Text Day – The sponsor for this is obvious: TigerText, the new iPhone app that limits text message lifespan, inspired by the celebrity who escapades were revealed when he crashed his Escalade. (Shhh. We’re being discreet here.)
4.  National Jobs Day – No, not a spur for employment, but a chance to honor Apple’s Steve Jobs, who seems to be on the cover of every magazine and have product placements in shows like ABC’s Modern Family.  The idea here is you celebrate by standing in line outside of an Apple store.  Wait a minute, wasn’t that last Saturday at the iPad launch?
5.  National Day of Spam – One day, just one, when you’re required to read all spam and junk emails.  In return, the spammers would have to provide you with their own personal home street addresses, phone numbers and e-mail addresses. Hmm, on second thought this might end up being a one-time event.
6.  National Day of….? Now go ahead and make your day. If you had to promote a ‘National Day of …” what would it be, and why? Who would sponsor it?  Best idea wins a precooked meat product in a distinctive blue and yellow can, made by the Hormel Foods Corporation, in 13 delicious varieties.

Coupons, sweepstakes, contests, rebates are promotion techniques for changing behavior. Short term, they can change the economic outlooks of brands and the customers who buy them. But we’ve never thought of promotion marketing tactics as a way to change the economic outlook of nations – until now.

Yes, Promotion Could Change Nations.

From the Harvard Business Review we learned about a real life promotion experiment run by Michigan credit unions. It offered “entrants” one entry to win $100, 000 for each $25 they saved. (That’s $25 they kept for themselves and earned interest on, not “$25 they spent” or “$25 worth of product they purchased.”)

Could this be the answer to some of the current U.S. economic woes?
•    Because for the nation as a whole, more savings = less imported capital = more economic independence (from debt to China, for example).
•    And less money devoted to debt service means more money for expanding businesses, hiring employees, buying houses and cars, and so forth.

The Save To Win program at eight Michigan credit unions attracted $8.6 million in incremental deposits from 11,600 savers in 11 months; Nineteen Michigan credit unions will participate in 2010.  Among the 11,600 participants:
•    55% had no previous regular savings plan.
•    59% were lottery players.
•    64% had never used certificates of deposit before.
The program was developed by Harvard Business School professor Peter Tufano, who said: “Saving is really crucial now as the majority of Americans face insecurity about jobs, healthcare and their futures, and we were pleased to offer this easy and fun option to increase saving by credit union members.”

All this is contrary to what we think we know about economics. Save To Win is like a lottery (even though you can’t lose in Save To Win). And a lottery is a perfect example (we’ve always been told) of irresponsible economics. Some call it a “tax on stupidity.” Yet in this case it works.

No, Promotion Is Not The Solution.

On the other hand, sometimes promotion is not the solution to economic woes.
This Forbes article reports on a New York City “sales promotion” that rewarded poor people with cash incentives for maintaining good habits – $25 to $150 for going to the dentist, staying on the job, opening a bank account and so forth.  But after three years, Mayor Michael Bloomberg states that the program “doesn’t work in every case.”  Only 10 percent of families had two dental visits per year, only 1 percent more had health insurance, and only 3 percent fewer used costly services like check cashing. Fewer participants held jobs in the first year, and cash rewards had little effect on school performance or attendance.

Go Figure

If my colleagues and I had seen this programs in the planning stage, some of might have predicted just the opposite: That Save To Win would fail, because of the uncertainty of getting a reward (no matter how large), and that the cash incentives for behavior would succeed, because they’re a sure thing. But that’s logical thinking, and people behave logically only some of the time.

Today was one of those increasingly rare mornings when the first scan of the email inbox brought a pleasant surprise. No, I did not discover that I am the sole remaining heir of a wealthy doctor from (Fill in the name of some village in Nigeria). And I haven’t been presented with the opportunity of a lifetime by a manufacturer in Asia whose name I can’t pronounce but who offers me the import rights for an unspecified line of small appliances and computer-like stuff. My surprise and delight was triggered by someone closing the loop on a promotional marketing effort that will be one for the text books. Often we see a really great idea only partially executed. I am sure you have seen stuff that got your attention but failed to ask for the sale or the add-on sale. Here’s one that takes the idea of community, brand advocates and promoters and hits it out of the park.

I can be in the credits of the Paranormal Activity DVD

The email I got was from the nice folks at Eventful. They are the ones with the Demand feature that created the popular support for Paranormal Activity and turned a $15,000 budget film into a multi-million dollar cash machine. Now they are starting to hype the DVD and Blu-ray release by telling me I can get my name in the DVD credits if I register. Thousands of Eventful members who originally demanded the film come to their theaters will now be turned into a word of mouth army telling all their friends they are in the credits. Talk about building early demand for a DVD release! My hat is off to Eventful, Paramount Pictures, and everyone else involved. They have earned a spot in the Biggest Bang for the Marketing Buck Hall of Fame. Well done!

Maybe marketing doesn’t have to be dumbed down to be successful. That’s the implication of a recent Stanford University study on literacy.

Clive Thompson of Wired quotes Stanford Professor Andrea Lunsford and summarizes what she says about the impact of the Internet on college student’s prose: “’I think we’re in the middle of a literacy revolution the likes of which we haven’t seen since Greek civilization,’ she says. For Lunsford, technology isn’t killing our ability to write. It’s reviving it—and pushing our literacy in bold new directions.
The first thing she found is that young people today write far more than any generation before them. That’s because so much socializing takes place online, and it almost always involves text.”

What this could mean for marketing

On one hand, critics of marketing have always claimed that it appeals to the lowest common denominator. Supposedly, marketers act as if customers have the attention spans of oysters, are baffled by sentences with more than six words, and are indifferent to any kind of logical expression of features and benefits. This is the result of a combination of:
a) marketers’ cynicism and venality.
b) the Internet, and all of its trivial distractions from “serious” thought.
c) declining educational standards. (Critics have been complaining about declining educational standards since the time of the ancient Greeks. It’s a wonder we don’t all have the brains of single celled organisms by now.)

On the other hand, some of us do pay attention to David Ogilvy’s famous advice that “The consumer is not a moron, she is your wife.” Evidence that this point of view is closer to the truth include the legendary Volkswagen Think Small campaign and the current Mac vs. PC campaign.

No more lowest common “dumbnominator”

Now the Stanford Study implies there is hope for intelligent marketing. Because people who write well have the skills to read (or listen or watch) well. They can pay attention, understand ideas and follow a chain of logic in the marketing communications we send to them – if they want to.

“Can” is the key word here. Some marketers forget that customers don’t have to pay attention, understand and so forth. Customers already have their own lives and other marketers’ messages competing for their attention, so they just don’t have time for marketing communication that’s complicated, in love with itself rather than with the customer, clever without relevant content, or that hides the benefit or the special offer.

That’s why successful marketing should be simplified – but not dumbed down – even when it’s aimed at really smart people.  We’re not the only ones to notice this simple vs. smart paradox. Bob Schmidt of online writers’ cooperative helium.com says it well:  “Ironic, isn’t it? Using extensive writing skills to write in the most simplistic manner possible. Actually, that’s what has worked all along in the field of advertising.”

I recently dusted off some old books that were quite the trend-setters in their day. Well, maybe. In hindsight, how accurate were the popular Megatrends books? Here are a few highlights from authors John Naisbitt http://www.naisbitt.com/ and Patricia Aburdene. http://www.patriciaaburdene.com/

Megatrends (Published in 1982)

· We will move from a national to world economy. [Okay.]

· The U.S. will no longer be an industrial economy. [Yea.]

· We will shift from short term to long term planning. [Hmm?]

· Centralization will give way to decentralization. [Not.]

· The population will move North to South – to CA, FL, TX – From Chicago to L.A., Houston and very hot Albuquerque. [Albuquerque??? And as of today, Chicago’s hanging in there.]

· “We will eventually do some shopping by computer, but only for staple items.” [So opposite!]

· “Teleconferencing is so rational, it will never succeed. People want to go to the office – people want to be with people.” [At least they got “rational” right.]

Megatrends 2000 (Published 1990) http://www.amazon.com/Megatrends-2000-John-Naisbitt/dp/0380704374

· The internet is not mentioned on the eve of its explosion. [Where were the futurists?]

· Apple computers are mentioned, only in context of Western Eye Press of Telluride, Colorado – book editing and design.* [Apple introduced Macintosh in 1984 with an historic Superbowl ad. http://www.youtube.com/watch?v=OYecfV3ubP8. And who’s Western Eye Press?]

· Computers are mentioned for designing apparel and biotechnology.” [What were they writing their book with – a Smith-Corona?]

· “Corporate sponsorship of sports will plateau, while art sponsorships continue to grow dramatically.” [Michael Jordan was at his peak. Tiger Woods was on the rise. The Grand Old Opry was outdrawing the opera.]

· Among the growth companies cited were:

> Old Jefferson Tile – Texas

> Superior Technical Ceramics Corp – St. Albans, VT

> Schauer Manufacturing Company – Cincinnati – Battery Chargers

[Definitely not Warren Buffet’s picks.]

*Note: Desktop publishing began full-swing in 1985

Megatrends 2010 (Published 2007) http://www.amazon.com/Megatrends-2010-Rise-Conscious-Capitalism/dp/1571744568

· “The Dawn of Conscious Capitalism.” Top companies and leading CEOs are re-inventing free enterprise to honor stakeholders and shareholders. Will it make the world a better place? Yes. Will it earn more money? That’s the surprising part: Study after study shows the corporate good guys rack up great profits.” [‘Nuff said.]

(By the way, Michael Naisbitt is creator and author of UFO-Blog.com. Any relation to John?)

Faith Popcorn http://en.wikipedia.org/wiki/Faith_Popcorn is a little more difficult to pin down because of her amorphous observations. I don’t know if we “cocooned” more in the 90’s than we did any other decade. http://en.wikipedia.org/wiki/Cocooning St. Norbert College researchers concluded that The Popcorn Report had a 50% error rate versus her 95% claim, not something to base your business plan on. http://www.sbaer.uca.edu/research/mma/1999/25.pdf One skeptic observed, “If Popcorn is any kind of genius, it is only for marketing and self promotion, for she has packaged pure fantasy and sold it to some of the highest-level executives in U.S. industry.”

By the way, has your One-to-One Future happened yet? In 1996 Don Peppers’ and Martha Rogers’ monster seller renamed “Relationship Marketing” and had the nation believing that soon, we’ll all have personal dialogs with each of our favorite brands. http://www.amazon.com/One-Future-Don-Peppers/dp/0385485662 [They’re still riding that wave.]

Keep in mind that many future developments are self-evident, and even we non-futurists can predict many trends – we just don’t write books. Also keep in mind it’s a market-driven economy in publishing. Books about Roswell, the Bermuda Triangle, conspiracies and marketing buzzwords will always outsell scholarly approaches to those subjects. So, if you’re going to finally write your ground-breaking best-seller, err on the smoky side. As for my predictions, invest in quick reads with catchy titles, but don’t bet the farm on their predictions.

I think we marketers are all in the discovery phase of how to effectively use social media marketing to build brands.  It’s just not something that there’s much history with yet.

But I will say this…if Comcast is crediting Twitter with helping increase its customer satisfaction rate by 9% in the first quarter, then that should make all of us stand up and take notice.  Especially considering that “improved customer satisfaction” and “cable companies” rarely appear in the same sentence.

To brand or to discount? That is the recession question. Many marketers choose to discount and protect their share from their discounting competitors and generics. But they may do so at the expense of branding, eroding the product’s image and perceived value.

However, you can give consumers generous incentives while maintaining your brand’s integrity. Here are a few tactics to consider:

Tie-ins – Offer your mustard brand with their hot dog brand and get secondary signage in the store for both, while you share the offer costs. It may still say “Save!” but consumers see it more as a partnership of two quality brands.

Same for retail – Spend $50 at The Sports King, get a $10 gift card at The Vitamin King. By splitting the difference, you’ve turned the traditional 10% retail discount into a 20% offer at the same cost. And it’s a gift card, not a discount. (See “Premiums” below.)

Sweeps – Don’t make them visit your website or create a Youtube video to win. Make them buy your product, or at least, visit your store. Put the prize announcement on or in the product package.

Sweepstakes are totally accountable with the fixed costs of the prize, administration and delivery. And unlike coupon redemptions, 99+% of sweeps participants go unrewarded – just like the lottery. Plus, a sweeps can reinforce your brand’s image. Regarding the “No Purchase Necessary” law, have a write-in postcard alternative.

Premiums – Keep the full retail price, but offer something free or greatly discounted with purchase.

Liquor brands offer free custom glasses with purchase. Cheerios offered a free Pez dispenser in the box. Pez probably supplied it for free to get the candy-refill sales. It also worked famously during the Great Depression when theaters gave away collectible glassware. Caution: Make sure your premium is in high demand. (See “Tie-in” above.)

Purchase decision assurance – Some auto makers are offering guaranteed relief should you lose your job during this recession. Source an insurance provider.

20% more – Give consumers a bonus size box with more product. Your cost is some repackaging and the extra product, while the consumer perceives this as a far greater value than your cost of goods. They also perceive it as a bonus instead of a discount.

Buy-one–get one – Or buy one, get one at half-price. Again, you’re giving the cost of your goods, which is far less than the value the consumer perceives. If a 99¢ sponge costs you 20¢, you’ve given the consumer a 99¢ deal for 20¢.

Bundle – The consumer perception is you can sell for less because you’re selling more stuff. It’s more of a deal than a discount. And you can extend your brand’s trial or line extension sales – get this flavor with that flavor, get two yard lights with our mower, get our eye liner with our nail polish.

Gift Cards If You… – Gift cards sound like ‘gifts’ rather than discounts. And they have greater dividends. For one, consumers have to return again and buy more (and 50-70% of purchase decisions are in the store – impulse). Second, they have to earn the gift card by purchasing the qualifying item or dollar amount.

Cause – Don’t discount. Instead, offer to help those suffering in this recession. Plus, it’s a write-off. Most importantly, it’s doing the right thing.

It’s good to see that a leading voice in marketing is thinking along the same lines as I am. On April 17 I posted “Pharma Marketing: Too Much ‘Me Too.” The May 11 issue of Advertising Age ran a lengthy article headlined titled “Big Pharma Finally Taking Big Steps to Reach Patients With Digital Media.”

The article’s key points include:
•    Pharmas increased measured spending on internet media 36% to $137 million in 2008.
•    Pharmas’ preferred social media include blogs, Twitter, YouTube.
•    Fear of FDA regulation slows pharmas’ progress into social media.
•    Building relationships is the primary benefit of social media marketing.

Loreen Babcock, CEO of Omnicom Group’s Unit 7, sees social media as a way to rebuild trust between consumers and the pharmaceutical industry. “Look, there’s probably not an industry that could use and embrace the transparency and authenticity of social media right now more than pharmaceuticals,” Ms. Babcock said.

The Progress: Our original post started with the fact that pharmaceutical companies rank just above tobacco companies in consumer trust. But this new move into social media could change all that.
•    Ideally, genuine, benefit-oriented relationship-building content should build brand identity and preference.
•    And social media will be targeted toward actual prospects and customers instead of “all TV viewers.”

The Problems: However, a quick overview of some pharma’s digital initiatives reveals that:
•    The Johnson & Johnson Blog and Novartis Twitter initiative are well done, but they function as broad-based corporate news outlets, not as relationship-building marketing for specific products.  On the other hand, the Acorda I Walk Because site is specifically targeted to a tightly-defined community of MS patients.
•    Pharma’s social media measurement is primarily hits, submissions and click-throughs. Like virtually every other marketer using social media, they have not discovered how to directly measure impact on sales.

Starting with Southwest Airlines, and continuing with Sheraton Hotels and others, we’ve seen “no hidden fees” become a key point of marketing differentiation over the past year or so. They’re a response to other marketers’:

•    “Tire fees” and “privilege fees” on rental cars.
•    “Franchise fees” on cable TV service.
•    “Processing fees” on event ticket purchases.
•    “Towel fees” and “in-room safe fees” at hotels.
•    “Fees for calling customer service” on debit cards.
•    “Baggage fees” on airlines. (At least these are highly visible, thanks to extensive media coverage.)

The list goes on and on. These marketers running scared, taking on the long-term risk of alienating customers rather than face up to the short-term risk of raising the listed, advertised price in a very price-conscious economy.  The idea is that customers notice the list, advertised price, but rarely notice the hidden fees tacked on when they actually make a purchase.

Marketers who advertise “no hidden fees” find themselves in the same position as Richard Nixon when he proclaimed “I am not a crook.” Fortunately, the marketers telling the truth – or most of them are. But both Nixon and the marketers end up with an implied “we won’t screw you” as a very dubious differentiating claim.

So which do you think is worse? Should you bite the bullet now, by adding on hidden fees into the price and thus raising the advertised list price? Or keep adding on hidden fees and bite the bullet later, when customers rise up in resentment?

The following is another example of what my colleague Lowell Wallace talked about in his April 15 post, “Smart Marketers Shine In Recession.”

The smart marketer here is Goodwill Industries, the world’s largest nonprofit provider of education, training, and career services for people with disadvantages,. Their collection trucks and parking lot collection boxes have kept me vaguely aware of them for as long as I can remember, but there was never any reason to think of them in a marketing context.

Resale, revived.

Until now. Last night, lounging on the sofa with the TV on, I suddenly realized that the hip, musical “Monique is ravishing” women’s fashions commercial I was watching was for Goodwill resale shops, not at T.J. Maxx or Marshall’s or Old Navy.

What! Have Goodwill’s dusty, fusty old resale shops suddenly become hot shopping destinations for fashionistas? In a way they have, in part of because of marketing initiatives by national Goodwill Industries, and also because of a television campaign launched by Goodwill Industries of Central Indiana. Their two dozen TV commercials are now syndicated to more than fifty Goodwill organizations across the U.S. and Canada. One result: Within 8 months, sales increased 7%  at Goodwill stores.

And a TV campaign is just one way that Goodwill is building consumer awareness and traffic as it sheds its dusty, fusty image. For example: Goodwill of San Francisco worked with Joe Boxer to create a new clothing line. Goodwill of Greater Washington runs a webcast fashion show. And Goodwill Industries International partners with Levis, FLW Outdoors, and Bon Ton Stores.

What Lowell said about Allen Edmonds shoes is true for Goodwill too: “This is a great way to respond to the chaos of the recession — building business instead of just cutting costs.”

Having been a Mr. Boffo fan for a very long time, I enjoyed today’s offering. It’s a problem a lot of companies face and the reason so many will barely limp out of the recession. You don’t head marketing; you’re the only one left in the department.

Lots of fibs get told during the mating dance that precedes an acquisition and the rumors that swirl through the media after the closing. “Budgets will remain unaffected” and “Nothing substantial will change” are among the most popular. Such was the case with InBev’s acquisition of Anheuser-Busch. But when sport marketing accounts for almost $250 million in spending, one has to be a bit naive to believe that the budget axe wasn’t going to strike. Even as senior managers expressed optimism that budgets wouldn’t be cut and might even increased you got the feeling that someone was drinking the Kool-Aid.

Interesting Twists, Turns, and Topspin Lobs

Beginning in December reports surfaced that a lot of the promise-makers were departing the company and sponsorships were being pulled. One of the earliest budget casualties was Kenny Bernstein’s NHRA team. The Budweiser King was the longest running sponsorship in motorsports at over 30 years. Some stadium signage began to disappear too. But just when we were expecting news of more reductions, Anheuser-Busch InBev announces a new sports marketing effort. Matthew Futterman writing in Monday’s Wall Street Journal tells us that the company’s US unit is betting that the next game to sweep the country is ping pong. That’s right, ping pong. I’m not so sure I am buying into that just yet. The price was probably right (cheap?) and its easy to label it a grass roots effort in advance of explosive growth. When you start shopping the right hand side of the menu, you can wind up in some pretty unexpected (or bizarre) places.

Your thoughts? I’ll be in the basement clearing the Holiday giftwrap and decorations off the ping pong table. Knew I didn’t throw it out for a reason!

It may be the most popular sport you’ve never heard of. But you have seen it in action, in the recent Casino Royale James Bond movie, and in TV commercials and YouTube videos for Mazda, Converse, Adidas, Nissan and others.

Those athletes you see running up walls, leaping from building to building and jumping over cars are practitioners of parkour. It’s defined as  “obstacle course” and is also known as “the art of displacement.” Parkour is based on finding ways to get from point A to point B in the quickest manner possible. Typically, that means jumping over, climbing on, or flipping off of any obstacle in your path.”

So far actual parkour participation has been pretty much underground, noticed only by those who do it. But could it rise to rival martial arts, skateboarding and snowboarding as the next big thing in extreme sports, with famous brands sponsoring televised competitions, athlete endorsements and extensions into all forms of marketing communications?

Maybe.

There’s no denying that parkour is exciting to watch. It’s had a good deal of media exposure already – people recognize it, even if they don’t know what it is.  In the U.S, Parkour is relatively untouched by sponsors as the basis for event marketing – no one “owns” it yet. (Not so in Europe, where marketers are far more active in parkour sponsorships.) And it has powerful appeal to young people, the key demographic for many potential sponsors.

Or maybe not.

As it practiced now, parkour has no structure or competition – the basis for an event.  It’s potentially more dangerous than other extreme sports. It’s difficult to participate in. We can all imagine ourselves on a skateboard, but it’s difficult to imagine ourselves running up a wall. And perhaps most important, many practitioners of parkour see the activity as creative expression, and are completely turned off by the idea of competition and corporate sponsorship.

Will parkour be the next big thing in sports sponsorship? Or will limitations on actual participation and resistance from true believers restrict to a narrow niche? Tell us what you think.

Did you hear this?  So, if there’s a Grand Slam hit in the All Star Game this year, one million fans will get a free ticket to see the Disney movie “G-Force” on its opening weekend.  Make no mistake, this is no Goofy idea.  This promotion is brilliant!

It’s interesting that you’re seeing two of our largest forms of entertainment, movies and baseball, teaming up in this way.  This is the biggest promotional sponsorship of baseball by a movie studio ever and the first since “Angels in the Outfield” in 1994.  But whereas that film obviously had a direct tie-in with baseball, “G-Force” doesn’t.  I wonder if the recession served as a catalyst to make this happen?  Had to, right?

Which begs the question…so would Disney actually want a grand slam to be hit in the All Star Game?  Now, Disney says they’d love nothing more. They’d just love to give away a million tickets to their movie on opening weekend. Do you believe them? 

Well I sure do!  A grand slam guarantees another several days of “G-Force” buzz in the news cycles.  Plus, you’ll get the stars on all the morning shows as well as Dave, Jay, Conan, and Jimmy.  Besides, you don’t think those million winners are going to see this movie by themselves do you?  You think they might have kids who want to go?  With a grand slam, “G-Force” would all but guarantee itself a huge, first place weekend.  Which would then lead to even more buzz and more ticket sales.

Trust me, when the bases are full in this year’s All Star Game, nobody will be cheering for a “granny” any harder than Bob Iger.  He’ll definitely give Mickey Mouse a High Four if that happens.

That’s what I think.  Tell me what you think!

Low priced products and services have a hard time competing for genuine customer loyalty. As soon as someone comes along with a lower price, the customer is gone. At least, that’s what we marketers have always been told is true.

But it’s not necessarily so, especially when the lower priced brand offers relevant, intangible differentiation that the higher priced brand can’t or won’t match.

Fish musicians vs. flight attendant rap

For example, see how differently two competing marketers differentiate themselves.

First, see one of the most creative airline commercials ever:

Then compare it what passengers actually experienced on the competing airline:

We’ve all read about what makes Southwest Airlines so successful: Hedge buying of fuel to keep costs down, flying nothing but 737s to assure efficiency, no hidden fees and so forth.

The loyalty builder (at any price): Customer experience

All these make them the low price leader. But what makes them the added value leader is something that costs little or nothing: The customer’s emotional experience, as delivered by their employees.

This is not to say that there’s anything wrong with the United Airlines customer experience. Nor is this an argument for or against creative TV commercials or rapping flight attendants.

It’s just what truly differentiates United Airlines seems to appear only in their advertising. But Southwest’s differentiation – its relevant but intangible customer benefit of employee attitude – is part of the actual customer experience. It’s responsible for Southwest’s perennial leadership in ACSI I(American Customer Satisfaction Index) scores for airlines, and for customer engagement five times that of United Airlines, in a Gallup study.

That’s how the low price leader can beat the competition at building customer loyalty.

Throughout this current recession there have been any number of articles on what a marketer should do as budgets are cut and departments become ghost towns. A great many are sales pitches disguised as serious thought pieces. A desperate advertising agency white paper says, “You have to keep advertising. Seriously, you must. Our jobs depend on it.” Branding consultants often cite stacks of academic research that recommends retaining a branding consultant. It goes on and on.

Breath of Fresh Air

But every once in a while you’ll find someone who gets right to the point with research that even the finance folks can agree on, and does so with a refreshing, thoughtful style. Such was the case when I came across “Making Lemonade, Insightful Thoughts and Notable Facts on Growth in Recessionary Times.” You need to check it out.

Buffett Quotes Never Hurt

“Making Lemonade” is chock full of examples of those who launched successful businesses during recessionary times and the sobering news that half a million businesses failed in each of the to prior recessions. If you’d rather be counted among the former, instead of the latter, give it a read. You’ll find some nice quotes from our hero in Omaha too. And he’s never a bad person to reference when making your case to save or increase a marketing budget.

Later.

Imagine your industry was ranked just above tobacco in consumer trust.Wouldn’t you want to do something about it – especially if you were selling products that are “good for” people’s health?

Evidently the pharmaceutical industry doesn’t want to, at least in their marketing. After many years of fat profits selling “me too” products, they seem to be content with “me too” marketing campaigns as well.

Abe Lincoln and a talking beaver, people who look like food (i.g. this Vytorin Ad), and doctors walking through hospital halls reciting the product’s lengthy disclaimer copy are three examples of pharmaceutical TV commercials aimed at consumers. For me, the brand names and the benefits are a blank. Is a patient supposed to say “Doctor, how about prescribing the medicine that makes me look like food?”

Yet pharmaceutical marketing departments continue to insist on the Catch-22 approach to choosing outsider sources of marketing help: “We only work with companies who already have extensive experience in our area.” In other words, companies who can show us how to do what we already know how to do.

Isn’t time for one/some/any pharmaceutical company to open up to new ideas, create new processes to develop and test those ideas and bring in new resources to challenge business as usual? We think so.

Last week I happened across an ad in The Wall Street Journal for one of the coolest “recession sales slump fighting” ideas I have seen. Allen Edmonds, a high-end shoe company, is promoting its Recrafting service. You send them your old Allen Edmonds shoes and they make them look like new. You can check it out here.

Pocketing the Retailer’s Cut

This is a great way to respond to the chaos of the recession — building business instead of  just cutting costs. If you can’t sell customers a $300 pair of new shoes (and a lot of unemployed Wall Streeters aren’t buying just now) you may as well sell them new soles and heels for up to $120. Good deal for the customer when the shoes look like new with a killer shine at a fraction of the price of new; good deal for you keeping cash flowing in and making a nice profit by going straight to the customer.

Angelo the Cobbler Meets the 21st Century

When many of us were growing up we knew an Angelo. He was the shoe repair guy in town where Mom took your Buster Browns to be re-soled. You remember those shoes. They were the gunboats she bought you two sizes to big and told you Father, “Don’t worry. He’ll grow into them.” It appears the Allen Edmonds folks had the same Mom and realize there is money to be made after the sale by replacing Angelo. Selling customers more of whatever you can is a proven recession survival tool. Come to think of it maybe the hired Angelo.

Let’s Find More

If you come across someone who is demonstrating some real marketing smarts at a time when most marketing departments and budgets are being gutted, give me a shout. Let me know about the stinkers too.

Wheels up.

A recent article and a recent direct personal experience of missed opportunity by marketers led to this post.

On a recent trip to NYC with my family, we went to see the 3D animated feature Monsters vs. Aliens. On our way into the theater, we were each handed a pair of 3D glasses. On our way out, an usher reclaimed our glasses to be distributed to future movie viewers.

But as the four of us walked down the streets of the upper eastside of Manhattan, a different uniformed usher chases us, asking if we’d returned out 3D glasses, implying that he’d like to frisk us like shoplifting suspects. Nice customer service.

There’s got to be a better way. Aren’t 3D glasses so cheap they’re given away, sometimes as magazine inserts? Evidently not, as the recent conflict between Fox and theater operators demonstrates:

There’s got to be a better way. Is the profit margin in movie theaters so slim (even with escalating ticket prices) that they have to assume their customers are thieves? Like they’d do us a lot of good at home?

There is a better way- a different dimension for 3D movie marketing. Why can’t the two main marketers concerned here – the movie studio/distributor and the movie theater chain – get together with other marketers to sponsor the 3D glasses. Start with big soft drink and confection brands in movie theater concession stands, where the theater stands to make most of its money anyway.

To marketing buzz words like “user engagement”, “success metrics” and “demand creation” we can now add the word “agnostic.” It’s showing up more and more in the marketing trade press, in blogs and on agency websites. Usually it’s coupled with the word “marketing” or “media,” and an agency’s promise to clients that goes something like this:

“We make marketing decisions impartially, without inherent bias for or against any one kind of communications channel – TV, print, online, direct mail, etc.”

Agnostic marketing is a response to the mass marketing mindset.

At least one agency –Naked New York- has made a religion out of not believing in any one communication channel. They say they’re “media neutral;” they don’t create ads or buy space or time for them.  According to one its partners, they “do not have any predisposition to recommend any channel.”

“Marketing agnosticism” is a good idea, as far as it goes. We applaud their efforts. But we also think they don’t go far enough. Read the rest of this entry »