Tuesday, December 25, 2007

Experiential marketing/branding and the newfound power of Gen X

In an article called “Enjoy the experience turn on, tune in--and pay attention,” (December 3, 2007), Brandweek talks about the trend toward experiential marketing—“essentially, a sophisticated term for getting into public spaces and letting the consumer interact with your product personally.” Apparently giving consumers a live experience with the brand is proving to be a successful way of reaching people. Here are some examples of companies and what they’re doing to give customers a branded experience:

* Panasonic is parking tractor trailers labeled “Panasonic. Living in high definition.” outside Best Buy and other retailers. The trailers have had a makeover designed to look like “a guy’s dream living room,” complete with all the Panasonic electronics it can hold. Sales of Panasonic HDTVs are up an average of 30% at every retailer that’s had the truck parked outside; Panasonic has set aside one-third of its 2008 marketing budget for experiential initiatives.

* The Wii videogame has been on tour to U.S. shopping malls, where consumers can experience what it’s like to use it.

* For Paramount Pictures’ The Spiderwick Chronicles Experience, the company sent “a customized vehicle loaded with digital equipment that stopped at schools, malls and museums, where kids who ventured inside could see how CGI animation works.”

* “DeWalt tools now spends 50% of its marketing budget on nontraditional advertising, including experiential efforts such as Rolling Thunder, a roving display that parks at Nascar events and allows the public to have fun playing with its newest power tools.”

* “Air New Zealand is hitting the streets of California in an ice-cream truck. Free treats are meant to remind customers that there's beautiful summer weather in Kiwi land. ‘It gives a face and personality to our airline,’ said marketing manager Jodi Williams. ‘This approach gives us more buzz for our buck.’”

Experiential marketing is working well right now because consumers are sick of being bombarded with in-your-face TV, radio, and web advertisements, and are shutting them out with TiVo, satellite radio, and simply clicking away from online ads. (Not to mention the do-not-call laws restricting telemarketing.) In contrast, experiential marketing is an interactive, personal, tactile experience that takes place at the discretion of the consumer.

Experiential marketing is not new, notes the article…as long ago as 1911 Heinz sent door-to-door representatives to do taste-tests with consumers. And the tactic worked.

The article also notes that experiential marketing comes with potential pitfalls, such as spoiled food, people who “simply don’t want a leaflet thrust at them,” and with legal issues that come up. But I think one of the biggest potential pitfalls is to create a marketing experience as opposed to a brand experience. People should not just experience the product, they should experience the brand. That is what builds loyalty over the long term, rather than just having the consumer encounter the product and walk away with a shrug and a “that was nice.”

Speaking of experiential marketing, Brandweek also (December 17, 2007) has a case study called “Schwab’s (Gen) X Files,” about an event targeting 25-to-34 year olds in New York in which “teams of financial consultants and brand ambassadors” took up posts at kiosks and “roaming the streets in a 37-foot ‘Talk to Chuck’ RV. They gave out calculators that compared the yield of Schwab’s own checking account vs. the national average, gave out fake ATM cards which people exchanged for $2 bills (and some $100 bills), and also gave out checking account applications. Schwab is pleased with the results thus far. Interestingly, targeting Gen Xers was cited as a priority by 86% of top marketing executives in a recent survey commissioned by the Marketing Executives Networking Group and conducted by Anderson Analytics. This is a very high percentage and only two percent shy of the percentage who said baby boomers are “still the most sought-after demographic.”

I say this is interesting because it seems to me that it is Gen Xers who are leading the charge when it comes to taking their thoughts about brands to the Internet (a la Citizen Marketers), and it is probably . Gen Xers who are the ones tuning out TV with TiVo and turning on satellite radio. The power of this group to completely shift the marketing and branding paradigms we know of today seems very much unrecognized by the marketing media, so it was nice to see the marketing survey come out which pointed to the influence this generation is having.

Now here’s a piece of can’t-turn-away-from-it marketing that clearly doesn’t work. In “Fast food gets its greasy hands on report cards,” the Chicago Tribune talks about a school in Florida that partnered with McDonald’s to feature a cartoon of Ronald McDonald along with an ad for a “food prize” for “elementary school students who had good grades, behavior or attendance.” The idea was for parents to reward their high performing children with a trip to McDonald’s. The promotion, in which the sponsor paid the cost of printing the report cards in exchange for an advertisement on them, totally offended parent Susan Pagan, who was “told that she was the only parent who thought it was inappropriate to put fast-food ads on the report card jackets.” But apparently it’s been going on for the last decade, and Pizza Hut used to be the sponsor. Here is a way, the article notes, that McDonald’s is “branding its product early and often in impressionable young minds to build loyalty and create lifelong customers.” This even though McDonald’s has recently stated that it will “stop marketing all food or beverage products in elementary schools” and will “advertise only its healthier options to children younger than 12.” Pagan is likely a Gen Xer herself; and I am not surprised that her story is all over the Internet.

The bottom line: Gen Xers are taking control of the marketing and branding marketplace, influencing everything about this field in a big way. Nobody is talking about it much, but they really should be. We are witnessing a key generational shift.

Monday, December 24, 2007

“Curator Culture” and Branding

In a recent article on his blog, Steven Addis, the CEO of the CEO of Addis Creson, a Berkeley, CA based branding firm, postulates that we have shifted into a “curator culture.” Like museum curators, the new consumer has “unlimited resources to research products, review them for others, and expose the disingenuous….the ability to transmit on a mass scale…. with credibility corporations have all but squandered.”

This idea is not new, although the terminology may be unique. It is similar to the premise of Brand Hijack and Creating Customer Evangelists and my own writing on the subject of customer co-creation and brands. And earlier than that, in 2001 and before, brand futurist Marian Salzman was talking about the “prosumer,” or “empowered consumer,” noting that customers had seized the reins from marketers and were increasingly demanding—and getting—their way.

What is unique about the curator culture concept? The role of brands, which has shifted. As consumers enjoy a higher-level status, companies’ status has been lowered to that of potential peer. And curator customers only trust peers that behave in a certain way. In effect, brands need to step off their high horses and get into the mud with the average consumer, becoming one of them—like them—no higher in level. Addis outlines several ways that companies like this “are earning our trust”:

1. Locate and serve a niche market: “Consumers reward the brands that speak directly to them. The more they feel understood, the more they bond. In spite of this, the natural tendency of companies is to extend their brands as wide as possible in the hopes that they might appeal to everyone. These mega-brands inevitably fall on their own weight as they lose the connection with their core audience.” Companies can serve the masses, but they have to do so by hosting “a portfolio of narrowly defined brands.” He gives the example of Toyota, which created the Lexus brand for luxury buyers, and the Scion brand for the polar opposite—urban youth without a lot of money. He notes that Scion billboards proudly state: “So wrong for so many.” Personally, I’m not sure this is an aspect of curator culture, but rather the continuing kingship of positioning, which has recently come under attack.

2. Act trustworthy: This is a no-brainer. Addis writes: “The Curator Culture cuts both ways—consumers reward the sincere and expose the disingenuous. As John Feldman, partner at the law firm Reed Smith said, ‘If you’re in the business of selling candy, sell candy; if you’re in the business of selling burgers, sell burgers.’” You can be a “bad” brand, as long as you’re honest about it, but if you act like a “good” brand and are not, you’ll get trounced. “An infamous example of corporate duplicity was the controversy surrounding the Working Families for Wal-Mart blog,” he states as an example. “At first glance, the site appeared to be a grassroots organization countering the public criticism of Wal-Mart by union-backed groups like Wake Up Wal-Mart and Wal-Mart Watch. But it was later revealed that this site was actually created by Wal-Mart and their public relations company, Edelman. Wal-Mart was publicly flogged for creating the impression of spontaneous, grassroots behavior.”

3. Invite customers to co-create the brand: “In the current zeitgeist, the ‘tell-and-sell’ approach of traditional advertising is waning. Today’s consumers have become accustomed to having a growing impact on the success of a brand. So, when a company invites its customers to participate in their brand, it’s saying that it values them and their opinion.” Examples range from letting M&M consumers vote on a new candy color; letting LEGO customers “design and buy their own custom LEGO models, and share their designs with others”; a director meeting with “nontraditional media” (e.g., bloggers) to generate publicity for the movie Superman Returns; and even allowing customers to create the TV commercials for Doritos and Chevy.

4. Act as an advocate for other consumers. “Some companies actually rise to the level of peer by putting the consumer’s interests above its own.” This is notable, he says, in the Progressive Insurance business/brand strategy of showing customers quotes from itself as well as its competitors.

5. Be original—independent of other brands. “The new consumer values originality and can easily perceive ‘me-too’ brands,” writes Addis. “The courage to differentiate from other brands is a weapon against mediocrity. Nobody rushes to share a mediocre experience with a friend. But, I underscore ‘courage,’ as most companies’ tendency to frame brands errs to the familiar, leaving the courageous few to be envied. Part of this differentiation is creating “a great story,” as the Verse Group has also emphasized. Of course, as noted above, other peers (consumers) to the brand will want to have a hand in generating those stories themselves, now that we are in the age of YouTube.

6. Provide an experience of elation—more than just satisfaction. “A common misconception is that the opposite of dissatisfaction is satisfaction. Satisfaction falls in the middle of the continuum. The opposite of dissatisfaction is something more like elation. Satisfaction should be the bare minimum companies expect from us,” writes Addis. An example Addis provides is JetBlue giving customers great snacks “like Terra Chips, pistachio biscotti, and jumbo cashews—and they certainly don’t charge for them. Every seat has DirectTV and XM Satellite Radio, and in select airports, free wireless hotspots are provided. Best of all, they keep their prices competitive, which has earned them a loyal, evangelistic customer base.” (He adds: “This, coupled with its CEO’s sincere apology posted as an online video, got them over a dramatic lapse in their service last winter.”)

Addis argues that consumers “do feel special bonds with the very few brands that rise to the level of peer….While you might not be able to put your finger on exactly why you love the brands you do, they stand out above the others by instinctively understanding the power of the Curator Culture.”

I think these points are well worth companies’ pondering. As much as other books and articles have provided a cultural context and some understanding of the elevation of today’s consumer, this article provides some concrete guidance for brands seeking to cope in this new environment.

Tuesday, December 18, 2007

What to do? Seniors have brand hijacked the Wii

In a previous post, I talk about the issue of whether brand creators should "let go of the brand entirely and let consumers appropriate, define, and sell it in their own ways," as Wipperfurth argues in Brand Hijack.

I conclude that "marketers have a responsibility to establish a meaning for the brand in advance of presenting it to the consumer. The consumer may appropriate the brand in different ways, may reshape and refine and rework its ultimate meaning, but the essence of the brand is, or should always be, in the hands of the marketer."

Now we have a situation where older people are appropriating the Wii game console for their own use, as The Washington Post reports: "On the retirement community scene, bingo is looking a little like last year's thing, as video games have recently grabbed a spot as the hot new activity. More specifically, retirees are enthusiastically taking to games on the Wii, which has been under-supplied and over-demanded at retail stores all year, thanks largely to the system's appeal to a range of consumers."

What is Nintendo, the maker of Wii, supposed to do about this? Should the company allow senior citizens to hijack the brand, and even cater to them; should the company ignore them and hope they will go away so that they don't drive away the core youth demographic that the Wii is aimed at; or what?

My thought is that Nintendo should cave in, but in a very limited way: design a limited-edition Senior Wii subbrand, along with targeted games for seniors, to divert off that segment of the population. It would be a brilliant move. Not only would the company retain their business, but they would probably increase business, as seniors experience a brand made and customized just for them. At the same time, the core demographic will not be alienated...they will have the original authentic Wii experience.

Brand hijacking can be scary for a company when it occurs. But the best thing you can do is ride the wave on a golden surfboard: Make brands anew when a segment of customers calls for it, and preserve the original brand meaning you initiated for your target audience.

Saturday, December 15, 2007

Brand positioning vs. brand stories: it’s really both, not one or the other

A new paper by the Verse Group claims that brand positioning is dead, and in its place comes brand storytelling. Brand positioning, as Verse notes in this release on the subject, is the “theory that a brand should own one idea in a person’s mind.” Brand storytelling, in contrast, relies on a “complex interplay of emotions, experience, and sensations” to get the message across.

What’s this all about to begin with? Verse is responding to an Advertising Research Foundation report, based on three years of research, which found that storytelling-type TV advertisements are more effective than positioning-based TV advertisements at engaging the viewer.

According to an article in Brandweek (October 29, 2007), the ARF findings were clear. A total of 33 ads in 12 categories were analyzed by 14 “leading emotion and physiological research firms.” The study found, for example, that “Bud's iconic ‘Whassup’ (campaign) registered more powerfully with consumers than Miller Lite low-carb ads that essentially just said, ‘We're better than the other guys.’ Why? Because Bud told a story about friends connected by a special greeting.”

The ARF report emphasizes, as I have stated repeatedly, that brands “co-create” meaning with their consumers, rather than straightforwardly imposing meaning on them. The co-creation process is enhanced when brands are presented as stories rather than as one-dimensional aspects of meaning.

At the same time, the Brandweek article notes, storytelling ads are only “truly effective” when “the plots tie in to a positive brand message.” “When the emotional peaks align with the presence of the brand, or the impact of the brand in the story, the emotional connection with the brand is greatest,” says ARF Senior Vice President, Research and Standards Bill Cook in the article.

The reality is, it is brand positioning + brand stories that makes the brand work, not brand stories alone, and Verse Group misunderstands this completely. In trying to make a name for itself—ironically, in trying to position itself when the company is anti-positioning—Verse misses the mark. The company states, in very strong terms, that “‘brand positioning’ is perhaps the most misguided marketing idea in the past 30 years.” Nothing could be further from the truth. It is when brands are positioned effectively, and storied effectively, that they resonate with the target audience.

Verse is trying to put a semblance of ROI on brand stories. It says in its response to the ARF report that “paid media spending (is) estimated by Nielsen to be over $150 billion in 2006,” so that “even a modest increase of 10% in effectiveness would be equivalent to $15 billion.” Verse wants to “own” brand stories—it wants to be positioned as the company you turn to when you need one. But in the Brandweek article, Mark Truss, director of brand intelligence at JWT, cautions that the industry still doesn’t see the ROI, and therefore “marketers and advertisers are not going to embrace (this approach).”

My advice is to incorporate brand stories where possible, but center them on a strong positioning. This is the best approach to take to increase brand value.

Tuesday, December 11, 2007

Global "tribes" and branding

The Wall Street Journal (December 10) has a story about marketers closing in on global "tribes" who are united more by demographics than by nationality. The article gives the example of baby boomers, a transnational "tribe" that may well need hearing devices as they get older. Phonak Group is targeting boomers, who dread aging, by calling the device a "personal communication assistant." Multilingual advertisements all feature the same type of image--"youthful-looking customers who lead interesting lives." The CEO of Phonak says that baby boomers "all have a similar psychology--if we take away the stigma and show them a product that is high-tech and hip and easily improves the quality of their lives" they will buy it.

Other examples are teenagers "who socialize on the Internet and like the same music and fashions" and "working women trying to juggle careers and families."

The idea from a brand perspective is to "focus on the similarities instead of the differences," says Melanie Healey, president, Global Health and Feminine Care at P&G.

In an increasingly international world, it pays to be mindful of "tribes," and to cater to them...it's an idea worth pursuing. In fact, I wonder whether consumers of global brands are not themselves kinds of tribes, whether the Prada buyer in the U.S. is similar to the Prada buyer in France or England or Spain. If so, we may be wasting our time trying to cater to people by their sociodemographics...we could just cluster them by the types of brands they buy. Certain brand tribes affiliate with certain other brand tribes, and you can just go from there.

People are increasingly tending to define themselves by multiple brands, not just one or two.

This brings to mind an interesting Harvard Business Review article from June 2001, "See Your Brands Through Your Customers' Eyes," that talks about "A new, three-dimensional approach to mapping brand portfolios" that "reveals the complex relationships between your brands and those of other companies." It notes that "Volkswagen and Trek team up to bundle bicycles with cars. American Airlines, Citibank, and Visa jointly offer a credit card. Subaru markets an L.L. Bean edition of its Outback station wagon. Dell stamps Microsoft and Intel logos on its computers. Toys R Us partners with
Amazon.com to launch an on-line toy store. The interweaving of brands, now commonplace in business, is changing the rules of brand management."

The article notes that a tool is needed to look at brands the way they "actually appear to customers. In this article, we’ll describe such a tool and show how it can be used to create multidimensional maps—we call them brand portfolio molecules—that reveal the relationships among diverse brands and provide a powerful new way to think about brand strategy."

The point for tribes and branding is, it pays to understand the unique power of a brand, and how it aligns with other brands, when one is trying to classify a global tribe.

Also, an interesting document at this UK tourism site talks about "brand clusters" in terms of the type of vacation people like to take.

"To capitalise on this, Towards 2015 will concentrate on the development and promotion of what are known as ‘Brand Clusters’. These clusters define the sort of holiday our customers want in terms of the experience they are looking for. For example, there is the ‘sheer indulgence’ cluster which is characterised by fine dining, pampering, treats, luxury and celebration. Then, there is the ‘close to nature’ cluster which trades on the ‘wow’ factor of the South West’s uniquely diverse landscape, the fresh air, the wildlife and the stunning views."

That is another way of separating people into tribes...according to the type of branded experience they want to have.

One can keep going, but the point is to be imaginative about tribes, and not limited to the same old thinking (Internet teenagers, baby boomers, working mothers).