Branding matters: Best ever evidence.

Branding matters: Best ever evidence.

Sep 29, 2017 | Branding, Marketing

The darling of the techies everywhere, Apple, is about to release new phones.

They are the iPhone X, iPhone 8, and iPhone 8Plus for outrageous prices, when compared to the offerings from almost any of the other 300 plus companies that produce phones.

The Australian price for the iPhone X will start at $1,579 and up depending on the storage you choose, and there are already concerns that demand will outstrip the capacity to supply. (Is it possible this ‘impending scarcity’ is a pitch to hype early interest? No… Apple would never stoop to that)

According to IDG, Samsung is the current world market leader of units delivered with around 23% followed by Apple with 15%, Huawei with 10%, and the other 295 odd makers fighting for the other 55%. The numbers vary a bit, depending on the researcher, the timing, and a whole lot of factors, but the pattern is consistent.

In absolute contrast, Apple leads the profitability stakes with 83% of industry profits, with Samsung taking just 13%.

Forget the rest.

Which would you rather be, Samsung market leader by units delivered, or Apple, market leader by a country mile in profits?

How can this be?

The technology is now pretty generic; all the phones work well, few of us use all the functionality they can deliver, dare I suggest that most would use less than 10% of their phones capability. Still, enough of us line up to buy the new Apples at double the price of a technically equivalent, or depending on who you listen to, superior, Samsung, or cheaper again Huawei, to make Apple hugely, even outrageously, profitable.

While Samsung and others blather on about their technology, cutting edge flexible screens (in Samsung’s case) Apple while making the observations that their tech is new and leading edge, concentrates on marketing and branding,

This is perhaps the ultimate example of great branding over a long period, resulting in a total, absolute domination of an industry profit pool.

Consider those numbers again, a 15% share of units shipped converting into an 83% market share of the industry profits. This astonishing brand performance comes in a crowded and  commoditised market, whose growth while stellar to date is showing signs of flattening.

I did doubt the ability of Tim cook to keep the apple money machine churning after the death of Steve Jobs, but is seems that by beatifying him, and building on Apples remarkable marketing DNA, the ride continues.

 

 

 

 

 

 

 

 

Is being ‘sticky’ the key to success.

Is being ‘sticky’ the key to success.

Sep 18, 2017 | Branding, Marketing, Strategy

Those flogging business coaching to the owners of medium sized businesses seem to focus on one of the oldest sales techniques in the book, the ‘Before &  After’ pitch.

Describe the current situation, and make it as down and dirty as possible, then describe the new world, the joy of the state achieved by the application of their great coaching/technology/process, whatever it is they are selling.

No mention of the challenge in the middle, abracadabra, all is well, just $109/month, less than the cost of coffee and a roll every day and you are on your way to the ‘laptop lifestyle’.

Tangled up in the bullshit, never articulated, at least  to my hearing is a very valid notion, that of ‘Critical Mass’.

The critical mass in a nuclear reaction is the point at which the process becomes self- sustaining. It may take only a nanosecond, but there is that critical point, below which the process is not self-sustaining, and past which, it is.

At what point does a cloud, which is just an accumulation of moisture, suddenly change from being a cloud to dropping rain?

For small business owners, the point of critical mass, from where the business is self-sustaining, is usually that point from where they can take time out of the business, and enjoy the financial rewards of success.  The road to that point will be different in every case, and most in my experience never actually consider what the elements of critical mass may be in their particular business, and how they might influence them.

I think it might be about how ‘sticky’ you can become.

‘Sticky’ is not a term often seen in any form of business writing, it is more usual in kids books, but how is this for a definition:

‘Stickiness’ in business is the function of: Share of Wallet  X Propensity of customers to advocate for you.

The stickier you are, the more likely you will be to have your customers buy from you everything you can reasonably provide, and then go one step further and tell their friends, peers, and wider networks.

If you are  not sticky enough, you will be sub self-sustaining, but pass that sticky test, and the business will sustain itself, with some ongoing tweaking, which is different from the 80 hour weeks most small  business owners put in, to make a living, but often  not have a life.

 

Cartoon credit: Hugh McLeod and Gapingvoid.com.

 

 

 

The value of an engaged employee.

The value of an engaged employee.

Jul 14, 2017 | Branding, Customers, Marketing

We all talk about the necessity of ‘engaging employees,’ but rarely truly achieve it, or see it in others. However, when  we do see it, we just know in our guts that we are looking at the way we would always like it to be.

Yesterday I spent 90 minutes in a suburban McDonalds store killing time between appointments, reading the daily rag, drinking an excruciating coffee, and fiddling with the language in a client report. All this time I watched a young bloke in the store make everyone he came into contact with feel special, even great.

He was just a casual employee, whose job it is to clean the tables and mop the floor. He did this, but he also did much, much, more. He opened the door as people were coming towards it, he high-fived the little kids, he helped a lady fold a stroller after extracting her baby, he joked and pranced, and he did all this with a huge smile on his face.

Every single person he interacted with smiled back, and had a word, he threw some light on everyone’s day.

As the store manager delivered a meal to the person at the table next door, I observed to him that this young bloke was worth much more than they were paying him, to which the manager responded, ‘We give him as many shifts as he wants, and we love having him here’

Despite the excruciating coffee, and other sometimes annoying human traits on display from time to time at Maccas, I know I will be back at this one, and hoping to see this young bloke loving his work, and making the day of others again.

 

 

 

The marketing flip, with pike & twist.

The marketing flip, with pike & twist.

Jul 5, 2017 | Branding, Marketing, Small business

The marketing degree of difficulty has exploded, making getting a good score  exponentially more difficult.

There used to be a few TV and radio stations, newspapers and magazines by which to reach potential customers, and supply them with the information you thought they needed to buy your stuff.  It was mass marketing, with little to no ability to customise, personalise, or engage.

The name of the game was scale.

Scale of capital to control the means of communication and mass produce products for sale

Scale of financial resources  to afford the advertising costs demanded by the communication owners

Scale of markets, mass consumers

Scale of intermediaries like supermarket chains, and suppliers of capital and equipment.

Scale had all the power.

In 15 years, less than half my working life, marketing has flipped.

Individuals now have all the power

Marketing has to be personalised, one on one, or it will be ignored

Media channels are now virtually infinite, and the cost can be modest to free

Brands are only as good as the last delivery of value to the individual

However, the objective remains the same, just as with the fancy dive. It is to go through the surface with as little splash and disturbance as possible, a good old fashioned, well executed and relatively simple swan dive can achieve that objective as well as the fancy risky, and hugely complicated combinations of tricks.

Next time you are contemplating a complicated marketing dive with a pike and twist, consider the benefits of simplicity.

 

Will Amazons venture into book stores rewrite history?

Will Amazons venture into book stores rewrite history?

Jul 3, 2017 | Branding, Change, Marketing

I love books, thousands of them infest my home, and I have spent years of my life browsing. I may be one of the last “heavy consumers’ of books, and particularly coming towards Christmas, my local Dymocks and Berkelouw’s which have so far survived, welcome me with open arms.

There is a physical tactility to a book that you cannot get on a ‘device’, no matter how great the design, which has the potential to generate an emotional attachment.

Perhaps it is just me?

As a result of this I am on the Dymocks mailing list. Every month or so, I get an email outlining the deals on the best sellers, books of interest, and new releases.

Now, I do not mind the odd romance, or light ‘love and discovery’ adventure, I have probably read 2 or three in my time, but they are not my normal fare.

Nowhere near my normal fare.

Despite a couple of emails, and even a phone call to them indicating my absolute lack of interest in their hit list, and observing they have access to a significant amount of purchase data should they choose to use it, I still get this crap filling my inbox.

Meanwhile Amazon is opening book stores, bricks and mortar book stores.

Unthinkable a few years ago that having disrupted and almost destroyed book stores, they then venture into them.

Shades of the Washington Post turnaround under Jeff Bezos

They will be doing all the stuff in bricks and mortar stores that Dymocks, and all the other retailers now disappeared had the opportunity to do, but lacked the foresight and understanding of their customers to be able to do, despite having 15 years head start.

Book stores have a place, long live real books, and the stores that sell them, I guess they will be branded ‘Amazon’, and Jeff will keep laughing.

 

 

 

Is it schizophrenia or just something in the cactus?

Is it schizophrenia or just something in the cactus?

Jun 30, 2017 | Branding, Innovation, Marketing

For years consumer markets have been relentlessly commoditised by retailers who hold the power over the distribution, and who not unreasonably, have sought ways to divert the proprietary margins available from manufacturers pockets into their own. Short term thinking, but that seems to be the world we live in.

Largely retailers have won the game, and branded FMCG products are now becoming an increasing rarity, and mostly where they survive, it is on the back of trade deals and residual strength of brands built by smart and visionary marketing in yesteryear. In liquor there are still many brands, but unbeknownst to most consumers, many of them are just housebrands infused with the wine industry hyperbole that seems to be expected.

The impact on category innovation is yet to be really seen, but I suspect it will stumble further, as by my observation of the shelves, it has done over the past few years.

There however, is the schizophrenia.

Every now and again, a product emerges that runs against the trend.

Consumers are increasingly concerned with the integrity of the supply chains that deliver products to their mouths, so on the fringes there are some very expensive products, usually in alternative distribution that use long lists of adjectives to describe their products: organic, hand- made, all natural, crafted, you have seen them all. Occasionally they are genuinely ‘new’ products, but mostly they are better quality, low volume versions of the commodities available on supermarket shelves.Sometimes they work, and consumers pay a significant premium for  the story that supports the claims, but generally the promise given by the adjectives is taken on trust by consumers.

Technology will increasingly have a role in this as magic like Blockchain emerges that can both guarantee the integrity of products supply chain, and make it absolutely transparent. Suddenly the hyperbole can be subjected to rational scrutiny.

In 2013 George Clooney and a few of his mates wanted their own brand of tequila. Why not, they can afford whatever they want, (but why Tequila??) anyway, the brand they chose and subsequently built,  ‘Casamigos’ has just been bought by Diageo for $US1 billion, around 1.3 Billion Aussie. Not bad in four years!

I do not drink tequila, and the term ‘Super Premium Tequila’  seems to me to be an absolute oxymoron, although perhaps I am unduly influenced by one very bad night involving a bottle of the stuff and a lemon tree while at University.

For $1.3 billion I could be persuaded to give tequila a second chance. Is this growth and purchase of such a highly personalised brand another signpost that consumers are demanding a whole set of new experiences from the items they buy, or is it just something in the cactus?