January 21, 2018

The TV Is No Longer a TV

I am in the vanguard of cord cutters, a small but growing group of cable TV subscribers who have decided to ditch the cable box in favor of a variety of geeky devices that serve up entertainment through an internet connection.

Between 2008 and 2013, 5 million (or 5%) of US cable subscribers cut the cord, with 1.3% brandishing the scissors in 2013 alone, according to Toronto-based Convergence Consulting Group.

When I told my wife and daughter we were trendsetters, they rolled their eyes and said I was just being cheap (again). Regardless, a change in the way we think about entertainment has swept through my household and 5 million others in the US: The TV is no longer a TV; it is simply the biggest screen we have for watching entertainment.

It’s All About Screens Now
That’s because our new content providers, Hulu and Amazon Prime, are as easy to watch on a computer, an iPad, or, in a real pinch, a phone, as they are through the Roku device attached to the former TV. (When we absolutely need to see live network broadcasts – my wife and daughter insisted on seeing the Oscars live, for example – I plug in a set of Radio Shack digital bunny ears to turn our big screen back into a TV for a few hours.)

The New York Times says that cord cutting doesn’t save much money but I can attest that in my house (near Boston) it saves $125 per month. Not exactly chump change. Plus, we never watched that much programming to begin with, so the savings are that much more satisfying.

As you might imagine, stories like these are starting to throw a scare into the cable companies and the entertainment industry as a whole. “In the U.S., consumers are seeing fewer differences between telecommunications and entertainment,” says Jack Plunkett, CEO of Plunkett Research. “It’s all the same thing. We have truly entered an era of convergence where data, entertainment, and communications are all falling into one package.”

Except now it’s the consumers doing the packaging rather than the cable and telecom providers. Research by my colleague Polly Traylor turned up three ways that the status quo is threatened:

  • Frictionless consumption. There is a reason why Netflix and Apple iTunes have been so successful: they both have world-class selection and make it extremely simple to find what you want and begin listening or viewing immediately.
  • Everything is an entertainment device now. Even the top providers of gaming platforms– Sony, Nintendo and Microsoft– are now vying for the same entertainment eyeballs as the studios and networks and are retrofitting machines into multipurpose entertainment devices that stream content from Netflix and other Internet video providers.
  • Disruptors are everywhere. I’m sure that by now you’ve heard of an Internet TV startup called Aereo that uses tiny individual antennas to let consumers in several U.S. cities watch live broadcasts on Internet-connected devices and store shows in the cloud to watch later. All the major broadcasters have sued for copyright infringement and pushed it all the way up to the Supreme Court. Needless to say, if a tiny, barely two-year-old startup is already having its day in (Supreme) Court (against its will), we are in the midst of interesting times for the entertainment industry.

How have you changed the ways you consume entertainment?

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Why Brand Journalism Must Die

There is no such thing as brand journalism. I was a journalist for 25 years, so I should know.

I know what you’re thinking, “Oh here goes the burnt-out old journalist on a self-righteous rant about the sanctity of his beloved profession” (some prefer not to put journalism in the rarefied company of the medical or legal professions and therefore call it a trade; if you’d seen my SAT scores you’d probably agree).

But really, what people refer to as brand journalism really isn’t journalism or anything close to it. It’s marketing.

“It’s just an analogy!” you retort.

Well, okay then, it’s a terrible analogy. We don’t report on the state of the world, we don’t investigate corruption, we don’t take controversial positions, and we focus only on the subject areas that further the interests of our companies’ missions to sell stuff. That is marketing. It is branding. But it is not journalism.

Even if you do the heavy lifting, idea marketing kind of kind of stuff like the big services companies do, for example, where they interview people and do surveys, it isn’t journalism. You can say that you use journalistic techniques in order to create the materials, but it is still marketing.

Even if you interview external experts who don’t even work for your company and do not pay them and quote them word for word in your company’s materials just like a journalist does – no self-promotion at all. And even if you’re as objective and factual as all get out in what you produce, it still isn’t journalism because the intent behind the work is different. The intent behind journalism (in theory anyway) is to get at the truth, without commercial interests interjecting themselves into the process.

The best idea marketing is conceived, funded, created, and disseminated by a commercial interest in a commercial goal. And there’s nothing wrong with that.

Just don’t call it journalism or put that word anywhere near what you call it.

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How Manchester United Revolutionized Sports Marketing

Manchester United image for Koch blog postAsk me which English soccer, uh, football team I would support and I would say Liverpool. Not for any defensible reason; it’s just because that’s where the Beatles are from and because I know next to nothing about that kind of football (I think they made us play it once in gym class when I was in 7th grade).

I would expect that most other similarly ill-informed, old-fart American Boomers who were raised on other sports like me might say the same thing (Stones fans, don’t look for a “London” team to root for because it doesn’t exist).

However, among young people, not only is English Premier League football way more popular than any sport I watch, but one of those English teams, Manchester United, is the most valuable sports franchise in the world. According to a controversial poll commissioned by the team, 650 million people worldwide say they support the team.

Have a Backstory
Why do so many people around the world support a team from a little known, struggling industrial city in the northern part of England? Well, partly it has to do with tragedy (a plane crash in 1958 killed some of the team’s youngest, most promising players), a dramatic comeback (After being a perennial loser, Man U began winning a lot – and everybody loves a winner), and a charismatic manager named Sir Alexander Ferguson.

But Man U also did something else really smart. It didn’t just try to cultivate a fan base in England, it went global. Man U began enlisting players (and sponsors) from countries around the world and embarked on frequent tours of those countries. The franchise leadership also invested in marketing not just Man U but football itself as the true global sport.

What Happens When You Start to Lose?
But now that “Sir Alex” has retired and the team is slumping, how does Man U avoid the fate of the Dallas Cowboys, who were once known as “America’s Team” until they weren’t?

Research by my colleague Rob O’Regan has found that hanging onto the kind of global popularity enjoyed by Man U requires focusing on four key channels:

  • Social media. As part of its sponsorship of UK soccer team Tottenham Hotspur, Under Armour ran a social media contest that attracted entries from fans in more than 50 countries. Liverpool FC maintains 17 local language Twitter accounts.
    Some teams have set up “war rooms” to monitor fan sentiment and weigh in when appropriate. “Teams are paying a lot more attention to social media, because that’s where the younger generation of fans talks about sports,” says Mark Lehew, SAP’s Global Head of Sports & Entertainment Industry.
  • Fantasy sports. There’s real money in fantasy sports, which has grown into a billion-dollar industry. More than 36 million people from the U.S. and Canada spent an average of 8.7 hours a week playing fantasy sports in 2013, according to the Fantasy Sports Trade Association. For example, the time fantasy players spend managing their National (American) Football League teams throughout the week – making roster changes, proposing trades, researching players – leads to a “halo effect” that drives engagement with other NFL properties such as the league’s website, individual club sites, TV programs, and game broadcasts. Fantasy league members generally view about seven times more content – text, video, and data – on NFL.com than non-fantasy users. 
  • Web/mobile content. Fan bases aren’t just becoming more global – they’re also becoming more mobile. Approximately 70% of the traffic to NFL.com comes from mobile devices – up from 10% just a few years ago.
    The NBA’s stats.NBA.com website, which houses player and team statistics from the league’s 67-year history, has helped double time spent on NBA.com while generating more than 9.5 billion page views last season – an all-time record for the site. The site has also emerged as part of what NBA officials see as a burgeoning second-screen experience for fans watching NBA games on TV.
  • Loyalty programs. One club in England’s Football League, trying to address the implications of an intimidating atmosphere during its home soccer matches, created an engagement program as part of a broader initiative to bring back lapsed fans and new generations of supporters to its matches.
    Swiping a season ticket card when entering the stadium would tip off fan experience personnel to acknowledge fan milestones such as a child’s birthday. “A family receptionist would greet them and offer a surprise like a seat upgrade, a free gift, or a chance to meet a player,” says Mark Bradley, founder of The Fan Experience Company, a consultancy that worked with the club. Sales of family season ticket plans increased from fewer than 500 in 2009 to more than 7,500 in 2012.

As for me, I’m going to watch a Liverpool match but I can’t forget the team that did all the work to pique my interest in English Premier League Football: Man U. I think I could be easily converted.

How about you, do you root for a team that’s on another continent yet?

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The last of the anti-social marketing tactics

Taglines are the last bastions of a classic, one-way marketing messaging strategy, preserving marketing’s perceived right to tell customers what to think.

In truth, customers have never listened, except in a few cases of companies with the budget muscle to pound the tagline into customers’ heads over and over again though mass marketing and TV.

In B2B marketing, we’ve never been given the right to tell customers what to think, much less the budgets to pound a tagline into their minds. I’ve spoken to hundreds of CIOs in my career as a journalist and I can tell you that at best, they ignore taglines; at worst, they feel their intelligence insulted by them.

And yet we keep spending hard-earned shareholders’ dollars creating these shallow soundbites that are supposed to protect our brands, even though the transparency of the internet, and now social media, have rendered such defenses useless.

Not that the defenses were much more than Maginot Lines to begin with. I recently did a search on some well-known B2B technology brands and compiled their taglines in the list below. Many of these companies compete with one another. Can you imagine being a buyer surfing providers’ websites and seeing even a handful of these in quick succession? I put them in alphabetical order so that you can feel the “Power of Repetition” in the words and “Experience the Selling.” I mean, some of them are just plain incomprehensible, communicating to buyers that we live in “A Certain World of Connected Freedom for Caring People to Passionately Inspire the Valuable Impact of More Enterprise Silliness”:

  • A world of communications
  • Agility made possible
  • Applying thought
  • At the speed of ideas
  • Building a world of difference
  • Building tomorrow’s enterprise
  • Confidence in a connected world
  • Creating business impact
  • Cutting through complexity
  • Experience certainty
  • Experience the commitment
  • Freedom to care
  • Inspire the next
  • Passion for building stronger businesses
  • People matter, results count.
  • The power to know
  • The power of we
  • The power to do more
  • Results realized
  • The value of performance
  • Working with clients, not just for them

It is also interesting to note how many well-known B2B technology companies do not use taglines (at least not that I could see on their home pages): BMC, BT, Cisco, Deloitte, EMC, Juniper, Lenovo, Microsoft, Nokia-Siemens, Oracle, Pitney Bowes, Xerox. Are the marketers at these companies not doing their jobs? Or have these companies decided that they are going to stop trying to sell themselves in a couple of hackneyed words and instead do it through relationships and experience?

There’s even one company, IBM, which inverts the focus of the tagline from internal “capabilities” to something that customers may actually care a whit about: Smarter Planet.

'a Smarter Planet' logo

Image via Wikipedia

Actually, calling Smarter Planet a tagline does it a disservice. Unlike traditional taglines, which generally hang on the corners of websites like misplaced socks, with no discernible connection to anything around them, Smarter Planet is paired up with a lot of interesting thought leadership content that lines up with IBM’s business strategy—it’s a business theme rather than a tagline. I predict that we’re going to see a lot more B2B companies moving in this direction in the coming year.

What do you think? What am I missing about the value of taglines?

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2011: The year of personal brands

This is the year that the personal brand begins to do battle with the corporate brand. I think we need to let the personal brand win—especially in B2B.

Featuring big pictures and bios of your subject matter experts on your website is a good start, but it is the equivalent of paid search. It’s relevant but still a step removed from the truly personal connection. We need the equivalent of organic search, where our people rise to the top on their own, independent of their corporate affiliations. Then as marketers, we create a virtuous cycle that links these personal brands to the corporate brand. But it’s going to mean letting these people roam free outside the corporate firewall.

Pitting the corporate brand against the personal brand
Forrester Research is testing both sides of this argument. Now, awhile back I wrote a post criticizing Forrester’s decision to prevent its analysts from hosting their own personal blogs. I still believe what I said is right, but that’s not the purpose of this post.

The reason I bring up Forrester again is because they are actually so far ahead of the curve on this issue that they are the Sputnik dog of personal and a corporate brand testing. It’s a good problem to have, to be grappling with this issue as Forrester is.

Testing the popularity of content
If you follow social media, you probably know most of the story already. One of Forrester’s former analysts, Jeremiah Owyang, developed a big following on his personal blog “Web Strategy” in part because he hits on all cylinders of blogging: frequent posts, engaging content, and an active audience that contributes interesting and insightful comments. (And it should be mentioned that he started his blog before he came to Forrrester.) Another reason for his popularity, at least more recently, was because he was a Forrester analyst, and that brought instant credibility and gravitas to his words, because Forrester has such a strong brand.

But Owyang didn’t just post on his own blog; he also posted on a Forrester blog that was created around his business line. In other words, you had two avenues of attention and traffic that both complemented and competed with one another, at least from a branding perspective. In the early days, Owyang’s personal blog was driven by his personal brand and enhanced by the Forrester corporate brand. First you found Owyang, and then you found that Forrester was behind him.

Meanwhile, the Forrester corporate blog that he contributed to was driven by the Forrester brand and enhanced by Owyang’s personal brand. First you found Forrester, and then you found Owyang.

What better a, b test of personal vs. corporate branding could you get?

I wish I had the numbers to prove it, but my sense based on my own experience in social media is that Owyang’s personal brand won that battle. It certainly did in my own view. I found him on his own blog before I found him on Forrester’s and the conversation on his personal blog was more interesting and his community more engaged than on the Forrester blog.

What happens when your personal brand quits?
Of course, then Owyang left Forrester for a startup, Altimeter, that was started by a former Forrester analyst and which has since scooped up a number of other Forrester analysts. Right around that time, Forrester announced that it was ending the cross-posting experiment—no more personal blogs for its analysts. Any blogging would now be done from behind the firewall. I don’t want to assert cause and effect here, just pointing out the change.

Co-branding the individual and the company
As part of the change in its blogging policy, Forrester revised its blogging strategy as well, making its analysts more visible and giving them their own personal blogs behind the Forrester firewall. For example, Owyang’s replacement, Augie Ray, has his own personal blog, but his posts also appear on a group blog targeted at the business line he serves, “Interactive Marketing.” It’s a kind of co-branding strategy: individual analyst, line of business, and company brand all have equal billing at the top of the blog. So when Ray leaves, Forrester banks that people will want to follow the replacement analyst in interactive marketing for Forrester.

Meanwhile, Owyang still has his personal blog and it is as popular as it ever was—if not more so—than when he was at Forrester. And that’s a really good thing for Owyang’s new company, Altimeter Group. If you don’t agree, just go to Alexa and compare traffic at Owyang’s personal blog, the Forrester site, and the Altimeter site.

For smaller companies like Altimeter, the personal vs. corporate branding decision should be a no-brainer. Owyang’s traffic dwarfs that of the company. They should be thrilled that Owyang is still blogging, because he is constantly driving traffic to their site and exerting an upward pull on the corporate website’s traffic chart. People are going there to find out what company is backing Owyang and what they offer. If he left, would that traffic diminish? No doubt, but in the meantime, it’s all good for Altimeter.

For well-established brands like Forrester, the decision is less clear. The site already has lots of traffic and most people have heard of Forrester. Forcing analysts to start over again to build a personal following after they leave the fold may make it easier for replacements to follow acts like Owyang—at least from the corporate brand’s perspective

No doubt some will say that that proves that Forrester should never have allowed Owyang to keep his own blog. When he left, so did a lot of traffic that could have stayed with Forrester had he been surrounded by the corporate firewall.

The legacy of the corporate brand in the personal brand
But who’s thinking about the customer here? Will they really think less of you if one of your stars leaves? Was it a waste of time letting Owyang promote himself like that?

I don’t think so. Owyang’s blog is still packed full of references to Forrester and his work there. It’s clear searching on his blog today that Forrester played a big role in bringing him to prominence. And that association will never go away unless Owyang decides to one day just erase all traces of his past. There’s a very positive association there that underscores Forrester’s ability to nurture talent.

Now let’s look at that from the opposite perspective. Let’s say Ray builds as big a following through his Forrester blog as Owyang did through his personal blog. What happens to that content when he leaves? To me, the association is less positive over the long term. Do you really want a former analysts’ content to dominate your corporate brand’s search rankings after he or she leaves?

What about the customer’s view?
Now, I think that if we look at this from a traditional corporate branding perspective, your immediate reaction would be to expunge the analyst from your audience’s memory and start pushing the new content instead. And no doubt since the blogs are all behind Forrester’s firewall now, they can decide what stays and what goes, and can probably create ways through SEO to make the newer stuff more prominent in searches. I don’t want to speculate too much here because I’m not an expert on SEO.

But looking at it all from a customer’s perspective, I think Forrester looks better being a legacy on a star’s personal blog than having a star that leaves a void in content upon leaving. Let me underscore again that this is a good problem to have.

But as social media raises the ante for putting a personal face to the corporate brand, we are going to have to work through the issues that Forrester is grappling with right now. And we will need to avoid making knee-jerk decisions based on traditional brand thinking, because, like it or not, the brand game has changed forever.

What do you think?

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Why our thought leadership is broken

All of our talk about marketers becoming publishers is incomplete. We can’t just become publishers, we also have to become advertisers.

Let me explain.

For centuries, publishers had an uneasy, co-dependent relationship with advertisers. A wall existed between publishers and advertisers. Publishers (the good ones, anyway) gave some of the most prominent pages in their newspapers and magazines to advertisers in return for a lot of cash, access to a targeted group of customers, and editorial independence from advertiser influence.

Marketers, meanwhile, didn’t have a wall, so they filled their content with self-aggrandizing references to their own products and services that pissed off readers and sent them to other sources for advice.

What’s the point?
Lately, as traditional media fall away, marketers are getting the message and creating content that looks just like the stuff that readers love from traditional media: news, advice, and new thinking that is not meant to manipulate them into buying something. And they’re linking this content to their social media management strategies.

But that’s only part of the answer.

Ironically, a lot of this new content is pissing off readers in a new way: they like the content but they don’t understand why it’s there, where it’s going, or what they should do with it.

Marketing through association
This is where the advertising part comes in. One of the reasons that companies used to like to advertise in publications like Fortune and BusinessWeek and in trade magazines like CIO was that they could associate their companies with the smart content that these publications produce. The association was subtle, not overt. It may have taken quite a while before a reader started to associate a company advertising in a magazine with the subject matter covered in the magazine. But it happened.

Of course, then the internet happened and advertisers got tired of subtle. They demanded that readers click on their banner ads on publishers’ websites before they’d pay. Readers, long accustomed to the subtle approach, may have looked at those crappy banner ads but they didn’t click and the publishing industry has collapsed as a result.

But from the ashes of publishing, subtle association is making a comeback. The same web analytics that have destroyed publishing are now getting marketers fired because nobody’s clicking on their white papers and surveys.

Partly that’s a quality issue, but it’s also an issue of B2B marketers taking the publishing analogy too literally. They duplicate the content they used to see in trade magazines without providing the context that magazines provide for why that content is there in the first place.

Idea marketing as checklist
For many B2B companies, idea marketing is a check box on a marketing list. They think up all the different things that magazines offer to readers and then make a list: Surveys? Check. Interviews with industry luminaries? Check.

But readers are left to wonder, what’s the point? Why are you giving me all this stuff? What does it mean?

A new way to make idea marketing relevant
Marketers need to invent their own version of subtle association. The publishing model of ads next to content won’t work, of course. Putting ads for your own company next to your own content is silly.

Instead, marketers must create a clear line of sight for readers. They need simple, clear, visual messages that integrate with but don’t detract from their idea marketing content and make a reference to the services that they offer. A simple entry point leads to deeper and deeper related content. And all this deep thinking relates, by association, to the services that you offer.

The nice thing about online is that its hierarchical structure makes this kind of integration easy.

Here, marketers need to tear down a wall of their own creation—the one that separates the ad agencies from the idea marketing content producers. The two have to work together to create themes that are thoughtful and that are about getting readers interested—it’s about leading the horse to the idea marketing bucket. Rather than just shoving readers’ muzzles in the bucket of surveys and white papers, we lead them there with some short, clear, visual themes that are focused on issues that matter to customers rather than on silly ad tag lines or collages of the logo.

Association in action: Smarter Planet
The best example of this that I can think of is IBM’s Smarter Planet. I’m guessing that the term came from an ad agency. But it straddles the issue of green in a way that seems to show knowledge of the target audience and the kinds of ideas they might be open to receiving through such a campaign.

Most CIOs wouldn’t mind being green, but their businesses evaluate them on cost and efficiency. If they can be greener while cutting costs and becoming more efficient then great, but they won’t respond to a purely green message or content. Using “smarter” rather than “greener” seems to encapsulate and get beyond that dilemma in a way that only a good ad copywriter can.

Themes send a signal to the organization
Much as a good simple teaser headline on the cover of a magazine leads readers to the well of deeper content that is the feature story, so too does smarter planet serve as a simple way to lead readers to a bunch of what we would consider traditional thought leadership content: case studies, whitepapers, and a few links to services that CIOs could use in their own departments (with IBM’s help, of course).

The theme (as opposed to an ad slogan) is something that IBM’s marketers can use in many different channels, like social media, and sends a clear signal to the organization that Palmisano probably won’t complain if you decide to write a few post about the intersection of green and efficiency on your blog.

We’re building the publishing engines in our marketing groups, but I think we’re leaving this larger issue of themes and marketing by association out of the process. What do you think?

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Do too many cooks spoil the blog?

Scoble, Longhorn Evangelist
Image via Wikipedia

Companies who want to add their voices the blogosphere have a decision to make: Do we allow individual employees to be the dominant force in our efforts, or do we keep the focus on the company by creating group-authored blogs?

In part, this is an issue of control. Some companies have decided to let a thousand flowers bloom—i.e., individual employees can blog as long as they adhere to the company’s social media policy. The other is to take a more controlled approach and put a blog or a handful of blogs on the corporate website.

Multi-author blog are easier for companies—but what about the audience?
It seems that most blogs that are on the corporate website are multi-author affairs. The advantage to multi-author blogs (though not necessarily to the audience’s advantage), is that the workload can be shared, reducing the dreaded gaps in posts if bloggers get really busy in their day jobs. There is also less disruption when a blogger leaves the fold. And the brand or the issue that the brand wants to promote (say cloud computing, for example) remains the focal point of the blog rather than a particular personality.

The downside to this approach is that the blog can seem muddled, with bloggers of varied interests and abilities going off in their own preferred directions, leaving the reader to wonder who’s in charge here. It’s also harder to avoid the perception that the blog is a corporate organ rather than a natural outgrowth of your employees’ passions.

Multi-author is part of traditional branding
The multi-author approach is more loyal to the traditional marketing approach that says that the brand comes before the individual. Yet there’s no question that blog readers are looking to connect with a person, much as people follow their favorite columnists in a newspaper or a favorite character on a TV show. They enjoy getting to know the blogger over time.

Increasingly, I think the multi-author approach will become old school. An interesting article this week, Brand Building, Beyond Marketing, essentially argues that the issue of brand has gotten beyond the control of marketing and is increasingly embodied in the actions of individual employees. (This is especially true for services companies, which don’t have concrete products that can do the branding for them.)

Individuals can burn out—or just leave
Now, it is possible to highlight individual contributors within a group-authored blog to give readers a better sense of connection, but for me it never works as well as when the individual takes responsibility for the whole enchilada. Individuals can’t afford to play it safe if they want to build and keep their audiences.

The downside to this approach is that individual bloggers can get burned out easily (most already have day jobs, right?). Another problem is that they may move on to another company, perhaps taking their audience and any brand cred they’ve helped you build with them (most people pick on Robert Scoble as an example of this).

I don’t think there’s a definitive answer to this question yet—at least I haven’t seen any good research comparing individual vs. multi-author blog performance.

What do you think?

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Why B2B marketers need to embrace deal marketing

Honestly, why do we think that sophisticated B2B buyers are going to follow our brands on Twitter or become our fans on Facebook?

The answer is we don’t.

Even if we believe deeply in the power of social media, we all have that gnawing feeling deep in our guts that says that there’s little reason for a busy, intelligent person to want to receive frequent updates about our brands when those brands produce complex services and products with two-year sales cycles.

Once again, the answer is they don’t.

The research confirms it. A survey of 1000 consumers by marketing agency Razorfish found that just 3.5% of consumers follow a brand on Twitter for “service, support, or product news.”

We don’t follow brands, we follow deals
What drives consumers to follow brands on Twitter? Deals. According to Razorfish, 44% of respondents said they were looking for exclusive deals or offers, while 24% said they followed the brand because they were customers and 23% said they followed in the hopes of getting interesting or entertaining content.

That would seem enough to end the debate about B2B social media participation right there. What, are we going to send out coupons for 15% percent off an enterprise software installation? (Actually, B2B buyers would probably love that but we’d lose millions and get fired.)

We can’t do deals. That’s a B2C thing.

The expectation of value
But let’s dissect what’s really going on with these deals. Consumers follow brands because they have an expectation that they will get value from the relationship. But to use a famous example, how many Dell PCs can we expect a follower of Dell on Twitter to buy? To keep those followers interested, Dell needs to offer other, lesser things of value like deals on accessories, warranties, etc. At the heart of the relationship is the expectation of continuing value.

B2B marketers can create that same expectation of value—of deals—through content. Consumers show us that in a world where everything should be about deals, they are looking beyond the coupon as the sole definition of value. I’m actually shocked at the number of people who said they follow brands because they are customers. That’s a gimme for marketers to deepen the relationship with them. And another 23% said that they see enough value exchange in content alone to warrant a follow.

We have to understand that in B2B, content—in the form of ideas, education, research and support—are our deals. Social media like Twitter are the offer engines for the valuable thought leadership content that we offer through our other channels like the website and events. If we can offer a steady stream of these deals through social media, we give B2B buyers as much reason to follow us as consumers have to chase coupons.

What do you think?

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Apple's marketing arrogance

It’s marketing 101: don’t hold your needs above those of your customers—and don’t defy the expectations that you set with them.

Apple has violated both of those rules this week, and I’m sure they could care less—Apple long ago concluded that their products are so much better that customers will overlook the arrogance with which they treat customers. Here’s what happened: Those customers, (like me, ordering my first smart phone ever) who ordered an iPhone 3Gs over the web last week (Apple sent me an email inviting me to order—I didn’t pursue them) were promised that they would receive their phones “by June 19.”

So far, so good. But then Apple sent out confirmation emails to its customers listing a UPS tracking number link to track the progress of the shipment. I love the e-supply chain so I clicked to see UPS’s cool codes and see where they would ship the phone on the way to me (Anchorage, AK—how cool is that?). I was happily surprised when the manifest said I would receive it on June 17.

Then, this morning I saw the TechCrunch story about how Apple is having UPS hold the iPhones at the Louisville, KY hub until Friday—Apple’s official launch date. It makes sense when viewed from the Cupertino Ivory Tower: Why would Apple want customers to get the products they have purchased before we told the world they should have them?

But of course, true to Michael Porter and Michael Treacy and Fred Wiersema’s principle of business strategy: companies only do one thing really well while trying to maintain parity with competitors on the things they don’t. Apple creates great products. The rest? Meh. UPS delivers packages efficiently—it is all about operational efficiency and supply chain.

So you won’t be surprised to learn that UPS took those iPhones and delivered the heck out of them. While Apple, which is all about product, didn’t pay enough attention (as usual) to that part of the business. Which meant that after UPS announced delivery dates to its customers, Apple stepped in to put the brakes on—and ordered UPS to go slower.

Can you imagine the looks on the faces of the folks at UPS central in Louisville as the word spread that they had to mothball the phones for two days and not do what they do best—deliver packages fast?

And can you imagine the arrogance of marketers telling their customers that a launch date matters more than satisfying their needs? I can’t. Can you?

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How customers will react to a crisis in your company and what to do about it

I’m continuing the discussion I began in my last post about when a crisis hits a brand. Geoff Dodds, Julie Schwartz and I brainstormed the different responses customers can have to a crisis and the steps you can take to address the problems.

Breaking the promise
When a crisis hits, customers make a decision about whether the promise of a brand has been broken and whether the relationship can be repaired. There are some important factors that will influence their decision and that should be considered in any brand decisions:

Existing brand image. Well-known brands have built up trust with customers and have farther to fall when a crisis hits. Coca Cola’s disastrous introduction of New Coke nearly destroyed the company because it broke the promise of continuity and reliability that had been built up with customers over the course of decades. Meanwhile, when startup airline ValuJet suffered a series of safety problems and a fatal crash in the late 90s, it quickly changed its name to AirTran. ValuJet’s lack of widespread recognition in the marketplace meant that the switch happened with little fanfare. Today, few people remember that AirTran (while certainly not a household name, either) was once ValuJet. (ITSMA’s Brand Equity Index provides a model for understanding a brand’s current image.)

Association of blame. In the court of public opinion, customers make a decision about whether the company as a whole is to blame for the crisis or whether the crisis was the work of a few rogue individuals acting outside the norms of behavior. When Computer Associates’ CEO Sanjay Kumar and some of his senior financial managers were indicted for securities fraud in 2004 for overstating company earnings in the late 90s, customers viewed the problems as the work of a few individuals rather than a sign of corruption throughout the company.

Collateral impact. If the crisis radiates widely beyond the company and damages other companies, the impact on the brand may increase. GM’s brand reputation has suffered as its missteps have affected its many suppliers, adding fuel to critics’ assertions that GM is bringing down the U.S. auto industry as a whole.

Ethical and moral impact. If the crisis is seen as being morally averse, or causes harm in ways that seem ethically and morally averse to the average person, it will affect the pace and depth of losses. When Enron management hid the company’s losses from the public and employees—even as managers cashed in their stock—and employees’ life savings evaporated, the company became permanently associated with greed and corruption. Similarly, when executives from Enron’s auditing firm, Arthur Andersen, refused to accept full responsibility for Andersen’s role in the scandal, trust in the company imploded—along with the company itself.

Speed of response. If companies are seen to be reluctant to respond to a crisis or its complications, it could have a negative impact on customer retention. For example, when certain models of Ford’s Explorer experienced tire blowouts, Ford delayed taking action with customers, blaming the tire supplier for the problems. But customers had not bought their Explorers from a tire manufacturer; they had bought them from Ford. They expected Ford to respond immediately to their requests for help. When Ford did not respond right away, it caused serious damage to the company’s reputation with customers.

Scope of response. Customers have a tendency to “forgive” brands that take more steps to resolve a crisis than the average person can envision or may even think necessary. When Johnson & Johnson responded to the Tylenol crisis by swiftly removing all bottles from the shelves (rather than just those in the areas where tainted bottles were discovered) and promising protective packaging to prevent that kind of crisis from happening again, it actually enhanced J&J’s reputation for safety and enhanced the brand’s position with customers.

Striking the right tone. Customers become highly sensitive to a company’s marketing and advertising messages in the aftermath of a crisis. If, for example, a company responds to a crisis by aggressively marketing itself to replace lost business without addressing the crisis or its impact, the company’s brand image will suffer. Marketers need to persuade the marketplace through the media that the crisis is being dealt with professionally and properly and there is clarity around the governance of the organization. Marketers should focus on getting that message out, not directly but through the media in as controlled a way as they can.
For example, when Oracle was found to have overstated its revenues in 1991, it removed its head of finance and brought in a new CFO, who announced that the company was changing its sales practices. Always known as an aggressive sales company, Oracle changed its practices for recognizing revenues so that salespeople would not be tempted to sell software before its official delivery date could be confirmed. Meanwhile, the company kept up its emphasis on research and development so that customers would see that it was still committed to offering leading edge products. The company took a different approach with customers and prospects, saying, “We’re a new Oracle.”

Use research to understand the context

In times of crisis, research with the following groups is especially important:

Customers and prospects. Research needs to be done with customers to get an aggregate sense of the degree of continued faith in the company and its ability to deliver.

Employees. Sales and delivery people are excellent barometers of the crisis because they talk directly to customers and prospects about their fears about doing business with the company in the wake of the crisis.

Analysts and influencers. Industry and financial analysts will likely have differing opinions about the current and future prospects of the company. But companies also need to find out what is being said about the company through other channels, such as the blogosphere and in customer forums.

Make choices about a brand’s future

We see B2B companies have three choices to make for their brands in the aftermath of a crisis:

  1. Retain the existing brand as is. In this case, marketers work to restore faith and credibility in the company through other means than a brand change, such as customer outreach, a change in management, change in processes, or other steps.
  2. Alter the brand enough to signal a new era. In the aftermath of its accounting scandal, Computer Associates decided that shortening its name to CA and changing its logo was needed to demonstrate that the company had recovered and was taking a new direction.
  3. Create a new brand identity and position. Going this route takes longer and costs more, but may be unavoidable if the crisis runs too deep.

A brand in crisis can be rescued—even enhanced
Customers and prospects are better informed than ever, thanks to the Internet and global connectivity. Companies in crisis need to act quickly. They need to act with absolute integrity and transparency in the wake of the crisis so that customers and prospects understand that the crisis was an anomaly that will be fixed. They need to do research to understand the impact of the crisis on key stakeholders and the business and prepare a response that goes beyond the expectations of these stakeholders. Through these steps, companies can rescue—and perhaps even enhance—the brand image they have so carefully cultivated.

Timing is important in making brand decisions in the wake of a crisis. Providers need to be able to predict the point at which the brand is beginning to erode irrevocably and intervene before that happens. But gaining the ability to be predictive requires research.

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